SB 419: MOVE DRINKING WATER LOAN FUND

An Act Relating To Public Finance; Moving The Drinking Water State Revolving Loan Fund From The New Mexico Finance Authority To The Department Of Environment; Providing Powers And Duties Of The Department And The State Board Of Finance; Making An Appropriation.

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MILD SB 419
MOVE DRINKING WATER LOAN FUND

Legislative URL:

SB 419 on nmlegis.gov

Emergency Clause:

No

Germane:

N/A

Location:

- OTHER -

Action:

[8] SCONC/SJC/SFC-SCONC API.

Issue(s):

Water Quality & Supply

Related Legislators

Bill Sponsor:

George Munoz

Related Documents

Downloads:

Introduced
Fiscal Impact Report

Summary

The bill moves the Drinking Water State Revolving Loan Fund (Fund) from the New Mexico Finance Authority (NMFA) to the Department of Environment (NMED). It makes numerous changes to the Drinking Water State Revolving Loan Fund Act (Act) to reflect that move and transfers various powers and duties from the NMFA to the NMED or the State Board of Finance. The bill adds a number of definitions used in the Act and amends others. Some of the new terms include “financial capacity,” “managerial capacity,” and “technical capacity.”

The bill gives the NMED the power to provide financial assistance to local authorities to finance all or part of a drinking water facility construction project. And, it gives the State Board of Finance the authority to issue bonds (including refunding bonds) upon the recommendation of NMED, the proceeds of which will be used for the purposes set forth in the Act.

The legislation amends current law regarding the criteria for financial assistance to a local authority. In addition to fine-tuning current language and making clarifying amendments, the bill adds several criteria including that the local authority agree to a number of practices such as maintaining separate project accounts and providing certain written assurances.

One argument in favor of this bill might be that it removes jurisdiction over these important funds from the NMFA, a quasi-governmental agency that has faced difficulties this past year regarding a “faked” financial audit. Another benefit of the bill might be that it places management of the Fund in the hands of the agency that otherwise deals with water quality issues, the NMED, and thus should have expertise regarding the underlying issues. A concern about the transfer might be the down time and learning curve involved in transferring programs of this magnitude and nature among agencies.

Date of Summary:  2/5/2013