NOTE: As provided in LFC policy, this report is intended for use by the standing finance committees of the legislature.  The Legislative Finance Committee does not assume responsibility for the accuracy of the information in this report when used in any other situation.

The LFC is only preparing FIRs on bills referred to the Senate Finance Committee, the Senate Ways and Means Committee, the House Appropriations and Finance Committee and the House Taxation and Revenue Committee. The chief clerks are responsible for preparing and issuing all other bill analyses.

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(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Economic Development Department (EDD)

SUMMARY

Synopsis of Bill

The bill would create a new division in the Economic Development Department (EDD), the private-public partnership division, responsible for creating a cooperative exchange of private sector executives from private and public universities to serve temporarily as advisors to provide expertise, leadership, and guidance in development of economic development policies and procedures. The bill would appropriate $100.0 general fund in FY2000 to EDD to fund the new division. Unexpended balances would revert to the general fund at the end of FY2000.

Significant Issues

According to EDD, that agency currently possesses the expertise within the department and continually seeks and fosters partnerships with those sectors identified to compose the private-public partnership. EDD actively engages in a cooperative partnership with private sector executives, private and public universities and community leaders in ascertaining direction, guidance and input pertinent to department policies and procedures.

FISCAL IMPLICATIONS

The smallest existing division in EDD has 3.0 FTE and a budget of about $300.0. The proposed appropriation for the new private-public partnership division would barely pay the salary and benefits for a division director (about $75.0). It is not clear that sufficient funds would remain to carry out the mandate of this bill. It might be preferable to pursue this objective through a new program within one of the existing EDD divisions. EDD anticipates a need for additional recurring costs to support the proposed division.

TECHNICAL ISSUES

Given the small amount of funding proposed in this bill, it might be preferable to pursue the objectives of this bill through a new program within one of the existing EDD divisions.

The ostensible objective of this bill is to promote participation of private- and public-sector executives in development of economic development policy in New Mexico. However, the language on page 2, line 18 limits this participation to executives from private and public universities. Is it the intent of this bill to exclude participation from private-sector business executives?

OTHER SUBSTANTIVE ISSUES

EDD suggested that one alternative to this bill would be to appropriate the funds to that agency to allow EDD to decentralize some of its services by establishing regional offices throughout the state. This would allow for the services to be better accessible and responsive to respective communities throughout New Mexico.

DH/prr