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SENATE BILL 31
57
TH LEGISLATURE
-
STATE
OF
NEW
MEXICO
-
FIRST SESSION
,
2025
INTRODUCED BY
Pete Campos and Joseph L. Sanchez
AN ACT
RELATING TO PUBLIC FINANCE; PROVIDING ZERO-INTEREST LOANS TO
POLITICAL SUBDIVISIONS OF THE STATE AND ELECTRIC COOPERATIVES
THAT HAVE BEEN APPROVED FOR FEDERAL PUBLIC ASSISTANCE FUNDING
FROM THE FEDERAL EMERGENCY MANAGEMENT AGENCY FOR A FEDERALLY
DECLARED NATURAL DISASTER; REQUIRING REIMBURSEMENT CONTRACTS;
PROVIDING FOR ENFORCEMENT OF THE TERMS OF THE LOAN CONTRACTS;
CREATING THE NATURAL DISASTER REVOLVING FUND; PROVIDING AN
ANNUAL TRANSFER FROM THE APPROPRIATION CONTINGENCY FUND TO THE
NATURAL DISASTER REVOLVING FUND; PROVIDING THAT THE STATE
RESERVES SHALL CONSIST OF CERTAIN FUNDS; CREATING THE FEDERAL
REIMBURSEMENT REVOLVING FUND; MAKING APPROPRIATIONS; DECLARING
AN EMERGENCY.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. [NEW MATERIAL] NATURAL DISASTER LOAN
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PROGRAM.--
A. The department of finance and administration, in
consultation with the homeland security and emergency
management department, shall provide zero-interest reimbursable
loans to political subdivisions of the state and electric
cooperatives that have been approved for funding from the
federal emergency management agency for a federally declared
natural disaster. The department of finance and administration
shall require a contract for reimbursement from a political
subdivision of the state or an electric cooperative to receive
a loan pursuant to this section. The contract shall specify:
(1) that the political subdivision or electric
cooperative shall pay the loan by providing a release to the
homeland security and emergency management department to
transfer directly to the department of finance and
administration money received from the approved funding from
the federal emergency management agency that serves as the
basis for the loan;
(2) that the political subdivision or electric
cooperative shall repay the loan within thirty days of becoming
eligible for reimbursement under the approved funding from the
federal emergency management agency;
(3) such notice or reporting requirements that
the department of finance and administration deems necessary to
be sufficiently informed regarding compliance with Paragraphs
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(1) and (2) of this subsection;
(4) a reasonably prompt deadline, determined
on a case-by-case basis by the department of finance and
administration, by which date the political subdivision or
electric cooperative shall be required to expend the loan for
natural disaster recovery purposes and that if the political
subdivision or electric cooperative does not expend the loan by
this deadline, the political subdivision or electric
cooperative shall pay an interest penalty on the loan, at a
fair current market interest rate or federal interest rate, as
determined by the department of finance and administration;
(5) that upon failure to meet a requirement of
this subsection, the loan shall be repaid at a fair current
market interest rate or federal interest rate, as determined by
the department of finance and administration; and
(6) that the political subdivision or electric
cooperative remit to the department of finance and
administration, which shall deposit in the natural disaster
revolving fund, all income from investment of money from the
loan.
B. All loan repayments and interest penalty
payments made pursuant to this section shall be deposited into
the natural disaster revolving fund.
C. The secretary of finance and administration
shall take any and all legal actions necessary to enforce the
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terms of contracts entered into pursuant to this section.
D. On or before June 1, 2025 and every six months
thereafter, the department of finance and administration shall
provide a report to the legislative finance committee and the
governor regarding the loans made pursuant to this section,
including:
(1) projects for which loan contracts have
been made;
(2) the dollar amounts of and repayments made
pursuant to those contracts; and
(3) any breaches of those contracts,
subsequent enforcement actions and results of the enforcement
actions, including applicable interest rates for contract
breaches and the determination of those interest rates.
SECTION 2. [NEW MATERIAL] NATURAL DISASTER REVOLVING
FUND.--
A. The "natural disaster revolving fund" is created
in the state treasury. The purpose of the fund is to provide
loans to political subdivisions of the state and electric
cooperatives that have been approved for funding from the
federal emergency management agency for a federally declared
natural disaster. The fund consists of distributions,
transfers, appropriations, gifts, grants, donations and income
from investment of the fund. Money in the fund shall be
invested by the state treasurer.
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B. Money in the natural disaster revolving fund is
appropriated to the department of finance and administration
for:
(1) the purposes of the natural disaster loan
program pursuant to Section 1 of this 2025 act; and
(2) administration of the natural disaster
loan program and enforcement of loan contracts; provided that
no more than two hundred fifty thousand dollars ($250,000)
annually shall be used for these purposes.
C. Money in the natural disaster revolving fund is
appropriated to the homeland security and emergency management
department for the compliance management of programs
administered by the federal emergency management agency that
serve as the basis for a natural disaster loan; provided that
no more than one hundred fifty thousand dollars ($150,000)
annually shall be used for these purposes.
D. The department of finance and administration
shall administer the fund, and expenditures from the fund shall
be by warrant of the secretary of finance and administration
pursuant to vouchers signed by the secretary or the secretary's
authorized representative or vouchers signed by the secretary
of homeland security and emergency management or that
secretary's authorized representative.
E. Any unexpended or unencumbered balance exceeding
one hundred fifty million dollars ($150,000,000) and remaining
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at the end of a fiscal year shall revert to the appropriation
contingency fund. Any unexpended or unencumbered balance
remaining at the end of a fiscal year shall be included in the
calculation of state reserves.
F. Any money repaid or reimbursed to the state
pursuant to Laws 2023, Chapter 2, Section 1 or Laws 2024 (1st
S.S.), Chapter 1, Section 2 shall be deposited in the natural
disaster revolving fund.
SECTION 3. [NEW MATERIAL] TRANSFER--APPROPRIATION
CONTINGENCY FUND TO NATURAL DISASTER REVOLVING FUND.--Within
thirty days after August 1 of each year through 2028, the
secretary of finance and administration shall calculate the
unexpended and unencumbered balance of the natural disaster
revolving fund and, subject to availability of funds, transfer
from the appropriation contingency fund to the natural disaster
revolving fund an amount equal to one hundred fifty million
dollars ($150,000,000) less the balance of the natural disaster
revolving fund. If the unexpended and unencumbered balance of
the natural disaster revolving fund is equal to or greater than
one hundred fifty million dollars ($150,000,000), no transfer
shall be made.
SECTION 4. Section 6-4-2.3 NMSA 1978 (being Laws 1991,
Chapter 10, Section 7) is amended to read:
"6-4-2.3. APPROPRIATION CONTINGENCY FUND.--There is
created within the general fund the "appropriation contingency
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fund". [A.] The appropriation contingency fund may be expended
only:
A. upon specific authorization by the legislature;
[or]
B. as provided in Sections [6-7-1 through 6-7-3 ]
12-11-23 through 12-11-25 NMSA 1978 in the event there is no
surplus of unappropriated money in the general fund and in the
amount authorized by the legislature
[B. Notwithstanding Section 6-4-4 NMSA 1978, for
the seventy-ninth fiscal year, if the revenues of the general
fund exceed the total appropriations from the general fund, the
excess revenue shall be transferred to the appropriation
contingency fund.
C. Five million dollars ($5,000,000) is transferred
from the operating reserve fund to the public school state-
support reserve fund in the eightieth fiscal year.
D. If revenues and transfers to the general fund,
excluding transfers to the operating reserve, appropriation
contingency fund and public school state-support reserve, as of
the end of the seventy-ninth fiscal year, are not sufficient to
meet appropriations, the governor, with state board of finance
approval, may transfer at the end of that year the amount
necessary to meet the year's obligations from the unencumbered
balance remaining in the general fund operating reserve in a
total not to exceed sixty million dollars ($60,000,000) ]; or
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C. as provided in Section 3 of this 2025 act ."
SECTION 5. A new section of Chapter 6, Article 4 NMSA
1978 is enacted to read:
"[NEW MATERIAL] STATE RESERVES.--The state reserves
consist of the:
A. appropriation contingency fund;
B. general fund operating reserve;
C. government results and opportunity expendable
trust;
D. state-support reserve fund;
E. tax stabilization reserve;
F. natural disaster revolving fund; and
G. federal reimbursement revolving fund."
SECTION 6. [NEW MATERIAL] FEDERAL REIMBURSEMENT REVOLVING
FUND.--
A. The "federal reimbursement revolving fund" is
created as a nonreverting fund in the state treasury. The
purpose of the fund is to use reimbursements from the federal
government for claims created by the state's response to
declared emergencies to ensure recovery for local communities
affected by such emergencies and respond to future emergencies
in New Mexico. The fund consists of reimbursed claims from the
federal government, gifts, grants, transfers, distributions,
donations and income from investment of the fund.
B. Money in the fund is appropriated to the
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department of finance and administration to make
appropriations, pursuant to Sections 12-11-24 and 12-11-25 NMSA
1978, for disaster relief after the governor declares an
emergency.
C. The department of finance and administration
shall administer the fund. Expenditures from the fund shall be
by warrant of the secretary of finance and administration
pursuant to vouchers signed by that secretary or that
secretary's authorized representative.
D. Any money reimbursed to the state or otherwise
received by the state for emergency expenditures from the
federal government, including money the state receives through
the federal Hermit's Peak/Calf Canyon Fire Assistance Act,
unless otherwise obligated under an agreement with the federal
government, shall be deposited in the federal reimbursement
revolving fund.
SECTION 7. APPROPRIATION.--One hundred fifty million
dollars ($150,000,000) is appropriated from the general fund to
the natural disaster revolving fund for expenditure in fiscal
year 2025 and subsequent fiscal years for the purposes of the
fund. Any unexpended or unencumbered balance remaining at the
end of a fiscal year shall not revert to the general fund.
SECTION 8. EMERGENCY.--It is necessary for the public
peace, health and safety that this act take effect immediately.
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