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 Jones
LAST UPDATED
ORIGINAL DATE 3/4/2025
SHORT TITLE Towing Svc. Oversight & Advisory Board
BILL
NUMBER House Bill 577
ANALYST Hanika-Ortiz
ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT*
(dollars in thousands)
Agency/Program
FY25 FY26 FY27
3 Year
Total Cost
Recurring or
Nonrecurring
Fund
Affected
NMDOT No fiscal impact $5.0 to $12.5 $10.0 to $25.0 $25.0 to $32.5 Recurring General Fund
Parentheses ( ) indicate expenditure decreases.
*Amounts reflect most recent analysis of this legislation.
*Estimate for FY26 is for one-half the fiscal year; the board’s first meeting is no later than January 1, 2026.
Sources of Information
LFC Files
Agency Analysis Received From
New Mexico Department of Transportation
SUMMARY
Synopsis of House Bill 577
House Bill 577 (HB577) creates the "towing services oversight and advisory board" at the
Department of Transportation (NMDOT) to guide the oversight of licensed towing services.
The board includes 12 members, one primary member and one alternate from each of the six
state transportation commission districts. The board shall (1) provide recommendations on
regulations related to towing services, (2) propose improvements to service standards and
compliance requirements, (3) ensure complaints are investigated and resolved, (4) facilitate
mediation for disputes, (5) assess if towing services are complying with regulations and
contractual obligations, (6) conduct audits and inspections, (7) submit quarterly reports, (8)
engage with stakeholders, (9) and educate the industry and consumers about towing rules and
their rights.
NMDOT shall select the board from stakeholders within the industry. Selections and terms of
service shall be made by January 1, 2026. Terms shall be staggered so the terms of three primary
members and three alternates expire at the end of the two years and the terms of the remaining
members expire at the end of three years. The board shall meet at least quarterly. Public
members of the board are entitled to receive per diem and mileage as provided in the Per Diem
and Mileage Act. NMDOT shall provide the staffing, funding and administrative support for the
board.
The effective date of this bill is July 1, 2025. House Bill 577 – Page 2
FISCAL IMPLICATIONS
The first meeting of the board would be no later than January 1, 2026. Staying within budgetary
limits for FY26, NMDOT would need to screen candidates for board membership, select staff to
support the board, and identify a meeting space or virtual meeting option. The estimated
additional operating budget table includes a range based on whether the quarterly meetings are
over one day or two. The estimated amount also includes additional funding to ensure the board
has sufficient budget to facilitate audits and field trip inspections, mediate disputes, and provide
educational materials for tow companies and the public about regulations and rights and
responsibilities.
NMDOT cautioned the bill would create a financial and administrative burden, especially when
duties are already performed by NMDOT, and the information to be found is already available.
SIGNIFICANT ISSUES
The bill creates a board tasked with balancing the interests of towing companies and vehicle
owners. The bill may even help reduce costs for the state and vehicle owners if the board’s
outreach initiatives help increase the number of tow companies in compliance with regulations or
reduce the number of disputed tows and local law enforcement’s role in resolving those disputes.
Law enforcement also has the authority to verify compliance with state law and local regulations.
State zoning laws and local ordinances regulate when and how vehicles can be towed, and
vehicle owner rights and responsibilities. Complaints against towing companies are often for
disputed or authorized tows or for excessive towing and impound fees. However, vehicle owners
are also responsible for following road signage and ensuring that vehicles do not create a safety
hazard.
PERFORMANCE IMPLICATIONS
Towing services must be licensed and insured per the New Mexico Administrative Code.
Towing services that fail to follow state law or local ordinances can see their tow rendered
invalid. For a questionable vehicle tow, complaints can also be filed with the Public Regulation
Commission.
ADMINISTRATIVE IMPLICATIONS
NMDOT may seek candidates from within the department as well as from the towing industry
and other stakeholders, if they are experienced in customer service, the law, or consumer
advocacy.
ALTERNATIVES
NMDOT suggested the industry and stakeholders could form an independent trade group.
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