SB 31
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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 AN APPROPRIATION;
DECLARING AN EMERGENCY.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. NATURAL DISASTER LOAN 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 SB 31
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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 (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 SB 31
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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
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 SB 31
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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. 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.
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 four hundred thousand dollars ($400,000) SB 31
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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 fifty million dollars ($50,000,000) and remaining
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. SB 31
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SECTION 3. 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 not greater than fifty million
dollars ($50,000,000) 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 fifty million dollars ($50,000,000), 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 fund". The appropriation contingency fund may be
expended only:
A. upon specific authorization by the legislature;
B. as provided in Sections 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; or
C. as provided in Section 3 of this 2025 act." SB 31
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SECTION 5. A new section of Chapter 6, Article 4 NMSA
1978 is enacted to read:
"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. 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
department of finance and administration to make
appropriations, pursuant to Sections 12-11-24 and 12-11-25 SB 31
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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. EMERGENCY.--It is necessary for the
public peace, health and safety that this act take effect
immediately.