LFC Requester:

/

Gudgel

AGENCY BILL ANALYSIS

2013 REGULAR SESSION

WITHIN 24 HOURS OF BILL POSTING, EMAIL ANALYSIS TO:

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{Include the bill no. in the email subject line, e.g., HB2, and only attach one bill analysis and related documentation per email message}

SECTION I: GENERAL INFORMATION

{Indicate if analysis is on an original bill, amendment, substitute or a correction of a previous bill}

Check all that apply: / Date Prepared: / February 06, 2013
Original / Amendment / X / Bill No: / SB 147
Correction / Substitute
Sponsor: / Jacob Candelaria / Reviewing Agency: / Public School Facilities Authority
Short Title: / EDUCATION TECHNOLOGY DEFINITIONS / Person Writing fsdfs_____Analysis: / Tom Bush
Phone: / 505-843-6272 / Email: /

SECTION II: FISCAL IMPACT

APPROPRIATION (dollars in thousands)

Appropriation / Recurring
or Nonrecurring / Fund
Affected
FY13 / FY14
NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates/Conflicts with/Companion to/Relates to:

Duplicates/Relates to Appropriation in the General Appropriation Act

REVENUE (dollars in thousands)

Estimated Revenue / Recurring
or Nonrecurring / Fund
Affected
FY13 / FY14 / FY15

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates, Relates to, Conflicts with, Companion to

ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT (dollars in thousands)

FY13 / FY14 / FY15 / 3 Year
Total Cost / Recurring or Nonrecurring / Fund
Affected
Total

(Parenthesis ( ) Indicate Expenditure Decreases)

SECTION III: NARRATIVE

BILL SUMMARY

Synopsis:

Senate Bill 147 (SB 147) clarifies the definitions of “Education Technology” and “Education Technology Equipment” and expands the definitions of the current technology permitted for use in the issuance of school district general obligation bonds, Public School Capital Improvement Act (SB9) mill levies and Public School Building Act (HB33) mill levies which require voter approval.

The Senate Public Affairs Subcommittee amendment amends SB 147 as follows:

1.  On page 1, line 11, after “CLARIFYING”, insert “AND EXPANDING”.

2.  On page 6, line 16, after “technology” insert “with a useful life equal to or exceeding the maturity of the bonds”.

FISCAL IMPLICATIONS

SB 147 carries no appropriation and there is no fiscal impact.

SIGNIFICANT ISSUES

·  Expands use of local district general obligation bonds from the “purchasing of computer software and hardware for student use” to “various equipment and tools used in the educational process that constitute learning and administrative resources” defined in the definition of education technology (Section 3).

·  Expands use of Public School Capital Improvements Act (SB9) from the “purchasing of computer software and hardware for student use” to various equipment and tools used in the educational process that constitute learning and administrative resources” defined in the definition of education technology (Section 4).

·  Adds permissive use of proceeds from the Public School Buildings Act (HB33) to purchase education technology, including computers and software (Section 5).

·  The Public Education Department addressed concern that with the expanded uses provided for in this bill, some items, including those for consumable use, either do not have a life expectancy that meets or exceeds the life of the bonds or would be obsolete well before the bonds mature. The Senate Public Affairs Subcommittee amendment addresses this issue by inserting “with a useful life equal to or exceeding the maturity of the bonds” after “technology” on page 6, line 16.

PERFORMANCE IMPLICATIONS

None Noted.

ADMINISTRATIVE IMPLICATIONS

None Noted.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

None Noted.

TECHNICAL ISSUES

Title indicates that the bill will only “clarify” definitions of education technology, but would expand uses of various funding sources for purchase of education technology. The Senate Public Affairs Subcommittee amendment addresses this issue by inserting “AND EXPANDING” after “CLARIFYING” on page 1, line 11.

OTHER SUBSTANTIVE ISSUES

It is unclear if the changes proposed in this bill would be able to be applied to existing or planned elections prior to the effective date of this legislation for general obligation bond authorizations or SB9 and HB33 mill levies as questions posed to the voters in the proclamation would contain the current language and allowed uses.

Expanded use for Education Technology would diminish capacity to fund other capital improvements or other allowed uses of the various funding sources. Historically, school districts fund 61% of all statewide construction spending from local taxes. To maintain the current FCI of 34.62%, the PSFA estimates $367M must be spent annually on school facilities-renewal. This leaves the State responsible for about $143M annually. Funding at a lower level places the state’s investment in school facilities at risk, as funding gaps may increase the rate of degradation and thus may exceed future funding capacity.

Expanding the use of SB-9 and HB-33 funds as proposed in this bill is a concern because a portion of these funds are used by districts for facility maintenance. The PSFAs Facility Maintenance Assessment Report (FMAR) indicates that the New Mexico statewide FMAR average is currently 60.9%. District scores are based upon a small random sample of 186 of the 800 schools.

School District Maintenance Performance – FMAR Scores

ALTERNATIVES

None recommended.

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

Districts would remain prohibited from directly purchasing computers and software from the Public School Buildings Act (HB33) unless under a lease-purchase arrangement pursuant to the Education Technology Act [6-15A-1 through 6-15A-16 NMSA 1978].

AMENDMENTS

See Technical Issues.