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HOUSE BILL 377
57
TH LEGISLATURE
-
STATE
OF
NEW
MEXICO
-
FIRST SESSION
,
2025
INTRODUCED BY
Joshua N. Hernandez
AN ACT
RELATING TO PROPERTY TAX; AMENDING THE DEFINITION OF
"RESIDENTIAL PROPERTY"; PROVIDING METHODS OF VALUATION FOR
PROPERTY TAX PURPOSES FOR MULTIPLE LIKE-KIND PROPERTIES WITHIN
A SINGLE COUNTY OWNED BY A SINGLE TAXPAYER AND FOR SEPARATE
CONTIGUOUS TRACTS OWNED BY A SINGLE TAXPAYER; EXCLUDING
TRANSFERS OF RESIDENTIAL PROPERTY THAT DO NOT HAVE A DWELLING
OR STRUCTURE FROM THE REQUIREMENT TO FILE AN AFFIDAVIT WITH THE
COUNTY ASSESSOR; REQUIRING A VALUATION AUTHORITY TO INCLUDE
COMPARABLE SALES DATA THAT THE VALUATION AUTHORITY USED TO
VALUE A PROPERTY IN THE NOTICE THAT THE VALUATION AUTHORITY
MAILS TO A PROPERTY OWNER OF THE NET TAXABLE VALUE OF THE
OWNER'S PROPERTY; PROHIBITING PENALTIES OR INTEREST FOR
DELINQUENT TAXES IF THE VALUATION AUTHORITY HAS NOT TIMELY
MAILED A VALUATION NOTICE TO THE PROPERTY OWNER.
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. Section 7-35-2 NMSA 1978 (being Laws 1973,
Chapter 258, Section 2, as amended) is amended to read:
"7-35-2. DEFINITIONS.--As used in the Property Tax Code:
A. "abandoned real property" means real property:
(1) that is part of a subdivision where the
subdivision has a minimum of five thousand lots in delinquency
on the department's delinquent property tax list as prepared by
the appropriate county treasurer pursuant to Section 7-38-61
NMSA 1978 as of January 1, 2019;
(2) of which the subdivided lots are vacant;
(3) that is part of a subdivision plotted on
or before 1980;
(4) the property taxes, penalties and interest
of which are delinquent for at least ten years; and
(5) that does not include property with
existing homes, businesses or other habitable structures;
B. "department" or "division" means the taxation
and revenue department, the secretary of taxation and revenue
or any employee of the department exercising authority lawfully
delegated to that employee by the secretary;
C. "director" means the secretary;
D. "livestock" means cattle, buffalo, horses,
mules, sheep, goats, swine, ratites and other domestic animals
useful to humans;
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E. "manufactured home" means a manufactured home as
that term is defined in Section 66-1-4.11 NMSA 1978;
F. "net taxable value" means the value of property
upon which the tax is imposed and is determined by deducting
from taxable value the amount of any exemption authorized by
the Property Tax Code;
G. "nonresidential property" means property that is
not residential property;
H. "owner" means the person in whom is vested any
title to property;
I. "person" means an individual or any other legal
entity;
J. "property" means tangible property, real or
personal;
K. "residential property" means [property
consisting of one or more dwellings together with appurtenant
structures, the land underlying both the dwellings and the
appurtenant structures and a quantity of land reasonably
necessary for parking and other uses that facilitate the use of
the dwellings and appurtenant structures. As used in this
subsection, "dwellings" includes both manufactured homes and
other structures when used primarily for permanent human
habitation, but the term does not include structures when ] a
tract, lot or other parcel of property that is not zoned
primarily for commercial, industrial or agricultural uses, and
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excludes properties zoned for or containing structures used
primarily for temporary or transient human habitation such as
hotels, motels and similar structures;
L. "secretary" means the secretary of taxation and
revenue and, except for purposes of Section 7-35-6 NMSA 1978
and Paragraphs (1) and (2) of Subsection B of Section 9-11-6.2
NMSA 1978, also includes the deputy secretary or a division
director or deputy division director delegated by the
secretary;
M. "tax" means the property tax imposed under the
Property Tax Code;
N. "taxable value" means the value of property
determined by applying the tax ratio to the value of the
property determined for property taxation purposes;
O. "tax rate" means the rate of the tax expressed
in terms of dollars per thousand dollars of net taxable value
of property;
P. "tax ratio" means the percentage established
under the Property Tax Code that is applied to the value of
property determined for property taxation purposes in order to
derive taxable value; and
Q. "tax year" means the calendar year."
SECTION 2. Section 7-36-15 NMSA 1978 (being Laws 1975,
Chapter 165, Section 2, as amended) is amended to read:
"7-36-15. METHODS OF VALUATION FOR PROPERTY TAXATION
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PURPOSES--GENERAL PROVISIONS.--
A. Property subject to valuation for property
taxation purposes under this article of the Property Tax Code
shall be valued by the methods required by this article of the
Property Tax Code whether the determination of value is made by
the department or the county assessor. The same or similar
methods of valuation shall be used for valuation of the same or
similar kinds of property for property taxation purposes.
B. Unless a method or methods of valuation are
authorized in Sections 7-36-20 through 7-36-33 NMSA 1978, the
value of property for property taxation purposes shall be its
market value as determined by application of the sales of
comparable property, income or cost methods of valuation or any
combination of these methods. In using any of the methods of
valuation authorized by this subsection, the valuation
authority:
(1) shall apply generally accepted appraisal
techniques; [and]
(2) in determining the market value of
residential housing, shall consider any decrease in the value
that would be realized by the owner in a sale of the property
because of the effects of any affordable housing subsidy,
covenant or encumbrance imposed pursuant to a federal, state or
local affordable housing program that restricts the future use
of the property or the resale price of the property or would
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otherwise prohibit the owner from fully [benefitting ]
benefiting from any enhanced value of the property. As used in
this paragraph:
(a) "subsidy, covenant or encumbrance
imposed pursuant to a federal, state or local affordable
housing program" includes those imposed by a nonprofit entity
approved by a governmental entity as a qualifying grantee
pursuant to the Affordable Housing Act; and
(b) "residential housing" means any
building, structure or portion thereof that is primarily
occupied, or designed or intended primarily for occupancy, as a
residence by one or more households and any real property that
is offered for sale or lease for the construction or location
thereon of such a building, structure or portion thereof.
"Residential housing" includes congregate housing, manufactured
homes, housing intended to provide or providing transitional or
temporary housing for homeless persons and common health care,
kitchen, dining, recreational and other facilities primarily
for use by residents of a residential housing project;
(3) shall value multiple like-kind properties
that are within a single county and owned by a single taxpayer
and that taxpayer's affiliates for the purpose of investment or
sale by using a discounted cash flow model that assumes that
all such properties are sold in a single sale on January 1 of
the valuation year; and
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(4) shall value separate contiguous tracts
owned by a single taxpayer and that taxpayer's affiliates as
though the tracts were a single tract composed of all the
contiguous tracts. For the purposes of this paragraph, tracts
shall be considered contiguous to each other if they share any
common boundary point or are separated solely by a public road,
an alley or other right of way .
C. Dams, reservoirs, tanks, canals, irrigation
wells, installed irrigation pumps, stock-watering wells and
pumps, similar structures and equipment used for irrigation or
stock-watering purposes, water rights and private roads shall
not be valued separately from the land they serve. The
foregoing improvements and rights shall be considered as
appurtenances to the land they serve, and their value shall be
included in the determination of value of the land.
D. The department shall adopt regulations to
implement the methods of valuation authorized in this article
of the Property Tax Code."
SECTION 3. Section 7-38-12.1 NMSA 1978 (being Laws 2003,
Chapter 118, Section 2, as amended) is amended to read:
"7-38-12.1. RESIDENTIAL PROPERTY TRANSFERS--AFFIDAVIT TO
BE FILED WITH ASSESSOR.--
A. After January 1, 2004, a transferor or the
transferor's authorized agent or a transferee or the
transferee's authorized agent presenting for recording with a
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county clerk a deed, real estate contract or memorandum of real
estate contract transferring an interest in real property
classified as residential property for property taxation
purposes shall also file with the county assessor within thirty
days of the date of filing with the county clerk an affidavit
signed and completed in accordance with the provisions of
Subsection B of this section.
B. The affidavit required for submission shall be
in a form approved by the department and signed by the
transferors or their authorized agents or the transferees or
their authorized agents of any interest in residential real
property transferred by deed or real estate contract. The
affidavit shall contain only the following information to be
used only for analytical and statistical purposes in the
application of appraisal methods:
(1) the complete names of all transferors and
transferees;
(2) the current mailing addresses of all
transferors and transferees;
(3) the legal description of the real property
interest transferred as it appears in the document of transfer;
(4) the full consideration, including money or
any other thing of value, paid or exchanged for the transfer
and the terms of the sale, including any amount of seller
incentives; and
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(5) the value and a description of personal
property that is included in the sale price.
C. Upon receipt of the affidavit required by
Subsection A of this section, the county assessor shall place
the date of receipt on the original affidavit and on a copy of
the affidavit. The county assessor shall retain the original
affidavit as a confidential record and as proof of compliance
and shall return the copy marked with the date of receipt to
the person presenting the affidavit. The assessor shall index
the affidavits in a manner that permits cross-referencing to
other records in the assessor's office pertaining to the
specific property described in the affidavit. The affidavit
and its contents are not part of the valuation record of the
assessor.
D. The affidavit required by Subsection A of this
section shall not be required for:
(1) a deed transferring nonresidential
property;
(2) a deed that results from the payment in
full or forfeiture by a transferee under a recorded real estate
contract or recorded memorandum of real estate contract;
(3) a lease of or easement on real property,
regardless of the length of term;
(4) a deed, patent or contract for sale or
transfer of real property in which an agency or representative
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of the United States or New Mexico or any political subdivision
of the state is the named grantor or grantee and authorized
transferor or transferee;
(5) a quitclaim deed to quiet title or clear
boundary disputes;
(6) a conveyance of real property executed
pursuant to court order;
(7) a deed to an unpatented mining claim;
(8) an instrument solely to provide or release
security for a debt or obligation;
(9) an instrument that confirms or corrects a
deed previously recorded;
(10) an instrument between husband and wife or
parent and child with only nominal actual consideration
therefor;
(11) an instrument arising out of a sale for
delinquent taxes or assessments;
(12) an instrument accomplishing a court-
ordered partition;
(13) an instrument arising out of a merger or
incorporation;
(14) an instrument by a subsidiary corporation
to its parent corporation for no consideration, nominal
consideration or in sole consideration of the cancellation or
surrender of the subsidiary's stock;
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(15) an instrument from a person to a trustee
or from a trustee to a trust beneficiary with only nominal
actual consideration therefor;
(16) an instrument to or from an intermediary
for the purpose of creating a joint tenancy estate or some
other form of ownership; [or ]
(17) an instrument delivered to establish a
gift or a distribution from an estate of a decedent or trust;
or
(18) a deed transferring residential property
that is not improved with a dwelling or other structure .
E. The affidavit required by Subsection A of this
section shall not be construed to be a valuation record
pursuant to Section 7-38-19 NMSA 1978.
F. Prior to November 1, 2003, the department shall
print and distribute to each county assessor affidavit forms
for distribution to the public upon request.
G. For an exception provided pursuant to Subsection
D of this section, the valuation authority shall not request
the affidavit required by Subsection A of this section or
otherwise request sales data from a taxpayer, transferor,
transferor's authorized agent, transferee or transferee's
authorized agent in connection with the exception. "
SECTION 4. Section 7-38-20 NMSA 1978 (being Laws 1973,
Chapter 258, Section 60, as amended) is amended to read:
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"7-38-20. COUNTY ASSESSOR AND DEPARTMENT TO MAIL NOTICES
OF VALUATION.--
A. By April 1 of each year, the county assessor
shall mail a notice to each property owner informing the
property owner of the net taxable value of the property owner's
property that has been valued for property taxation purposes by
the assessor and other related information as required by
Subsection D of this section.
B. By May 1 of each year, the department shall mail
a notice to each property owner informing the property owner of
the net taxable value of the property owner's property that
has been valued for property taxation purposes by the
department and other related information as required by
Subsection D of this section.
C. Failure to receive the notice required by this
section does not invalidate the value set on the property, any
property tax based on that value or any subsequent procedure or
proceeding instituted for the collection of the tax.
D. The notice required by this section shall state:
(1) the property owner's name and address;
(2) the description or identification of the
property valued;
(3) the classification of the property valued;
(4) the value set on the property for property
taxation purposes;
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(5) the tax ratio;
(6) the taxable value of the property for the
previous and current tax years;
(7) the tax rate from the previous tax year;
(8) the amount of tax from the previous tax
year;
(9) with respect to residential property,
instructions for calculating an estimated tax for the current
tax year, which shall be prominently displayed on the front of
the notice, and a disclaimer for such instructions similar to
the following:
"The calculation of property tax may be higher or lower
than the property tax that will actually be imposed.";
(10) the amount of any exemptions allowed and
a statement of the net taxable value of the property after
deducting the exemptions;
(11) the allocations of net taxable values to
the governmental units;
(12) briefly, the eligibility requirements and
application procedures and deadline for claiming eligibility
for a limitation on increases in the valuation for property
taxation purposes of a single-family dwelling owned and
occupied by a person sixty-five years of age or older; [and ]
(13) briefly, the procedures for protesting
the value determined for property taxation purposes,
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classification, allocation of values to governmental units or
denial of a claim for an exemption or for the limitation on
increases in valuation for property taxation purposes; and
(14) briefly, all data on the sales of
comparable property used by the valuation authority to
determine the value of property for property taxation purposes .
E. The county assessor may mail the valuation
notice required pursuant to Subsection A of this section to
taxpayers with the preceding tax year's property tax bills if
the net taxable value of the property has not changed since the
preceding taxable year. In this early mailing, the county
assessor shall provide clear notice to the taxpayer that the
valuation notice is for the succeeding tax year and that the
deadlines for protest of the value or classification of the
property apply to this mailing date."
SECTION 5. A new section of the Property Tax Code,
Section 7-38-50.1 NMSA 1978, is enacted to read:
"7-38-50.1. [NEW MATERIAL ] DELINQUENT TAX PENALTIES AND
INTEREST--REQUIREMENT OF VALUATION NOTICE.--A penalty shall not
be imposed pursuant to Section 7-38-50 NMSA 1978 and interest
shall not accrue pursuant to Section 7-38-49 NMSA 1978 unless
the valuation authority has timely mailed to the property owner
of the property a valuation notice required pursuant to Section
7-38-20 NMSA 1978 for that property tax year and the valuation
authority possesses a written record of such timely mailing."
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SECTION 6. APPLICABILITY.--The provisions of this act
apply to property tax years beginning on or after January 1,
2026.
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