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 Gonzales
LAST UPDATED
ORIGINAL DATE 2
/1/2025
SHORT TITLE Housing Trust Fund & Affordable Housing
BILL
NUMBER Senate Bill 145
ANALYST Leger
APPROPRIATION*
(dollars in thousands)
FY25 FY26
Recurring or
Nonrecurring
Fund
Affected $500,000.0 Nonrecurring General Fund
Parentheses ( ) indicate expenditure decreases.
*Amounts reflect most recent analysis of this legislation.
Relates to the General Appropriation Act of 2025
Sources of Information
LFC Files
Agency Analysis Received From
Mortgage Finance Authority (MFA)
SUMMARY
Synopsis of Senate Bill 145
Senate Bill 145 (SB145) appropriates $500 million from the general fund to the New Mexico
housing trust fund (HTF) for expenditure is fiscal year 2026 and subsequent years for the
purposes of the New Mexico Housing Trust Fund Act.
The bill earmarks 10 percent of the appropriated amount for funding to a municipality or county
for affordable housing projects, including new construction or rehabilitation of existing
affordable housing. The municipality or county is to provide no less than three times matching
funds from sources other than the state, have an adopted affordable housing plan and ordinance
pursuant to the act, and shall administer the project pursuant to the act.
The bill instructs the Mortgage Finance Authority (MFA) to prioritize affordable housing
projects in municipalities and counties that have expedited zoning processes that support
affordable housing development projects. Any unexpended or unencumbered balances remaining
at the completion of a project are to be returned to MFA to return to the housing trust fund. After
one-year, earmarked funds not awarded may be released from the restrictions prioritizing
municipalities and counties for funding.
Senate Bill 145 – 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 appropriation of $500 million contained in this bill is a nonrecurring expense to the general
fund. Any unexpended or unencumbered balance remaining at the end of a fiscal year shall not
revert to any other fund.
The Legislature established the HTF in 2005 to fund the acquisition, building, rehabilitation,
preservation, financing, weatherization, and home energy efficiency upgrades for low- to
moderate-income New Mexicans. MFA, the trustee of the HTF, has established programs,
partnerships, and administrative capacity to effectively utilize state funds for housing
development, preservation of existing affordable housing, and homeownership programs
statewide.
SIGNIFICANT ISSUES
According to MFA, a transformative investment to the HTF is required to address the housing
crisis facing the state. Such an investment would mitigate the affordable housing crisis in the
following ways:
Build rental and homeownership housing;
Supply downpayment assistance;
Rehabilitate aging housing stock;
Fund homelessness and homelessness prevention programs; and
Invest in innovative affordable housing projects.
MFA provides the table below as an analysis of how a $500 million appropriation could improve
housing opportunities based on the approximate cost of various program types. Currently, MFA
maximizes its federal resources for affordable housing, meaning transforming the housing
landscape requires significant state investment.
Senate Bill 145 – Page 3
MFA balances HTF allocations to programs based on two primary criteria: meeting housing
needs throughout the state and maintaining the sustainability of the funding source.
Downpayment assistance and rental and single-family housing development are typically
administered as loans, generating program income and significant leverage. MFA prioritizes
grant funding for programs serving the most vulnerable populations, including those facing or
experiencing homelessness as well as very low-income seniors and veterans.
MFA indicates local governments, urban and rural alike, are seeking to spur affordable housing
initiatives. In providing additional funding to the HTF, 10 percent of the allocation would be set
aside for local governments. While local governments are currently eligible to solicit HTF
funding, the set-aside would ensure that municipalities and counties are guaranteed funding
availability. As proposed, local governments would be required to leverage awards made through
the set-aside at a rate of 3:1. Unawarded funds within the set-aside would be released from the
set-aside restriction after one year.
During the 2024 legislative session, nearly $3 million was appropriated for various housing
projects statewide, while the Legislature appropriated $50 million to the HTF.
PERFORMANCE IMPLICATIONS
MFA reports, of the $122.1 million the HTF received in FY 2024 and 2025 through the
severance tax bond earmark and general fund transfer, 85 percent is allocated to various
programs and activities, 73 percent is awarded to grantees, and 28 percent is expended. These
performance metrics demonstrate MFA’s capacity to urgently deploy funding and serve
households in need.
Source: MFA
RELATIONSHIP
The LFC recommendation for the General Appropriation Act of 2025 appropriates $50 million to
the HTF to establish a program to support the expansion of housing services providers that
facilitate behavioral health services and substance abuse recovery, homelessness assistance and
prevention for people with behavioral health needs and transitional housing.
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