Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance
committees of the Legislature. LFC does not assume responsibility for the accuracy of these reports if they
are used for other purposes.
F I S C A L I M P A C T R E P O R T
SPONSOR Dow/Armstrong
/Parajón
LAST UPDATED
ORIGINAL DATE 2/28/25
SHORT TITLE
Rulemaking Agency Response to Public
Comment
BILL
NUMBER House Bill 425
ANALYST Hilla
ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT*
(dollars in thousands)
Agency/Program
FY25 FY26 FY27
3 Year
Total Cost
Recurring or
Nonrecurring
Fund
Affected
State agencies
No fiscal
impact
$67.1 to $200.0 $67.1 to $200.0
$134.2 to
$400.0
Recurring General Fund
Publication Fees
No fiscal
impact
Indeterminate
but minimal
Indeterminate
but minimal
Indeterminate
but minimal
Recurring General Fund
Parentheses ( ) indicate expenditure decreases.
*Amounts reflect most recent analysis of this legislation.
Sources of Information
LFC Files
Agency Analysis Received From
Regulation and Licensing Department (RLD)
Public Regulation Commission (PRC)
Energy, Minerals, and Natural Resources Department (EMNRD)
Health Care Authority (HCA)
Department of Health (DOH)
Department of Public Safety (DPS)
Agency Analysis was Solicited but Not Received From
Commission of Public Records (CPR) New Mexico Attorney General (NMAG)
SUMMARY
Synopsis of House Bill 425
House Bill 425 (HB425) amends 14-4-5 NMSA 1978, the time limit on adoption of a proposed
rule. HB425 requires agencies to provide responses to each public comment on a proposed rule.
An agency response to a public comment on a proposed rule shall:
- Be unique and specific to the public comment;
- Be fact-specific to the concerns of the comment; and
- Address the impact of the comment on the proposed rule.
An agency’s response to public comments shall be in writing an published with the rule in the
New Mexico Register.
House Bill 425 – Page 2
This bill does not contain an effective date and, as a result, would go into effect 90 days after the
Legislature adjourns if enacted, or June 20, 2025.
FISCAL IMPLICATIONS
The Regulation and Licensing Department (RLD) and the Energy, Minerals and Natural
Resources Department (EMNRD) anticipate an increase in recurring operating budgets to
address public comments. This analysis assumes that various state agencies may need to increase
their operating budgets within the range of $67.1 thousand to $200 thousand to support
additional legal staff or manage increased workloads without expanding personnel. However,
costs may vary by division based on the volume of rulemaking undertaken by each agency.
Agencies pay for the publication in the New Mexico Register at a range of $75 to $85 per page.
The Commission of Public Records’ guidelines recommend agencies to procure a purchase order
for no less than $320 for rulemakings with four pages notices. Depending on how often agencies
are updating rules, this cost is indeterminate but minimal for publication expenses to the state’s
Register.
SIGNIFICANT ISSUES
All agency analyses concern increases in administrative workload from HB425. The Department
of Health (DOH) and Department of Public Safety (DPS) note potential legal challenges the bill
poses on agencies. DOH states “if the agency response was deemed to have not sufficiently
addressed the impact of the comment on the rule, this might be considered a sufficient basis for a
court to invalidate the rule.” DPS add that “courts may be called upon to interpret whether
response to comments were sufficiently fact-based or adequately addressed concerns. This could
open agencies to legal battles over technicalities rather than the substance of the rules
themselves.”
The Health Care Authority (HCA) notes that public comments can be made orally at public
hearings, which HB425 would require written response to oral comments and “increases the
chances that a regulation will be challenged post promulgation, thereby costing the state time and
resources.” EMNRD adds that HB425 may lead to accommodations of public comment that do
not align with the agency’s core mission.
EMNRD and DOH are concerned that the bill would impede the executive branch from making
its rule making processes. DOH notes that the legislature grants rule-making authority to
agencies and “in doing so acknowledges a level of agency expertise in interpreting the
implementation of statutes that pertain to that agency’s programs and structure.”
PERFORMANCE IMPLICATIONS
This bill is likely to result in delays in the implementation of rulemaking. DOH notes that delays
in public rulemaking may lead to a loss in federal funding due to rules not being adopted in a
timely manner.
House Bill 425 – Page 3
ADMINISTRATIVE IMPLICATIONS
It is likely that this bill will increase the administrative workload on agencies that make frequent
rulemaking updates.
CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP
RLD notes duplication of existing law, stating:
Rule 1.24.25 of the New Mexico Administrative Code requires an agency’s “concise
explanatory statement” must include “reasons for not accepting substantive arguments
made through public comment” See Rule 1.24.25.14(F)(7). Additionally, pursuant to the
State Rules Act, NMSA 1978, §14-4-1 et. al. and specifically pursuant to NMSA 1978,
§14-4-3, indicating that “each agency promulgating any rule shall place the rule in the
format and style required by rule of the state records administrator…accompanied by the
concise explanatory statement required by the State Rules Act.” The concise explanatory
statement must include reasons for not adopting substantive arguments made through
public comment. The concise explanatory statement is a public record and made part of
the rule hearing record and is therefore subject to the New Mexico Inspection of Public
Records Act (IPRA), §14-2-1 NMSA 1978 et seq. Anyone wishing to review an agency’s
reasoning regarding public comments received on proposed rulemaking actions may
already do so pursuant to an IPRA request.
TECHNICAL ISSUES
RLD states HB425 is unclear as to whether an agency must publish both the agency’s response
and the public comment, or just the agency’s response, noting if both are required to be publish,
the “cost of such publication could be effectively doubled.”
ALTERNATIVES
RLD notes that agencies could publish responses to public comment on their official websites or
the Sunshine Portal, as opposed to publishing them in the New Mexico Register, suggesting that
this would be more cost-effective and in a timelier manner.
EH/hj/SL2