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 Cates/Ferrary LAST UPDATED ORIGINAL DATE 1/23/25 SHORT TITLE Prohibiting Nonfunctional Turf Installation BILL NUMBER House Bill 85 ANALYST Davidson ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT* (dollars in thousands) Agency/Program FY25 FY26 FY27 3 Year Total Cost Recurring or Nonrecurring Fund Affected NMED No fiscal impact No fiscal impact No fiscal impact $0 Recurring General Fund Total No fiscal impact No fiscal impact No fiscal impact $0 Recurring General Fund Parentheses ( ) indicate expenditure decreases. *Amounts reflect most recent analysis of this legislation. Sources of Information LFC Files Agency Analysis Received From New Mexico Environment Department Office of the State Engineer SUMMARY Synopsis of House Bill 85 House Bill 85 (HB85) creates a new statute that would prohibit the installation of nonfunctional turf on all state-owned or state-funded property beginning January 1 st , 2027. The bill requires that, after January 1 st , 2032, existing nonfunctional turf on state-owned or state-funded property only be irrigated with recycled or reclaimed water and that nonfunctional turf removed from state-owned or state-funded property be replaced with drought- and climate-resilient landscaping. 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 HB85 would have no fiscal impact through FY27. However, analysis from the New Mexico Environment Department (NMED) notes that, due to the requirement that existing nonfunctional turf be irrigated with reclaimed or recycled water after January 1 st , 2032, the bill could increase House Bill 85 – Page 2 the workload of its Ground Water Quality Bureau, specifically its Pollution Prevention Section. NMED’s Ground Water Quality Bureau is tasked with permitting the use of reclaimed wastewater; the Pollution Prevention Section further processes these permits. NMED predicts that the requirements set out in HB85 would, beginning in FY28 and FY29, require the Ground Water Quality Bureau and Pollution Prevention Section to process an additional 20-30 reclaimed wastewater end-user permits per year. NMED estimates that this increase would require additional FTE costing around $250 thousand annually by 2032. NMED notes that transitioning state-owned and state-funded property to xeriscaping could reduce water usage and, subsequently, water utility bills by between 50 and 70 percent. SIGNIFICANT ISSUES NMED notes that not all local government entities that would be affected by HB85 own or operate water treatment systems capable of treating wastewater for landscape irrigation use. Upgrading water systems capable of treating wastewater for landscape irrigation use requires “purple pipe” infrastructure for all properties using the treated wastewater, which, according to agency analysis, can cost between $50 to $250 per linear foot of line, translating to an average cost of $792 thousand per mile. NMED also notes that the costs associated with updating the infrastructure would likely fall on the local government entity. NMED states that operation of upgraded water treatment systems would also require employing water treatment operators with higher level credentials, a labor force already in short supply in New Mexico. CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP HB85 is similar to House Bill 352 from the 2024 legislative session, though HB85 does not require counties and municipalities to create a penalty for not following the new statute. House Bill 352 also applied to all nonfunctional turf on nonresidential property, whereas HB85 specifically applies to nonfunctional turf on state-owned and state-funded property. HB85 also moves the timeline prohibiting new installation and removal. AD/rl/SL2