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SENATE BILL 383
57
TH LEGISLATURE
-
STATE
OF
NEW
MEXICO
-
FIRST SESSION
,
2025
INTRODUCED BY
Candy Spence Ezzell
AN ACT
RELATING TO MUNICIPALITIES; PROVIDING FOR THE ISSUANCE OF FLOOD
RECOVERY REVENUE BONDS FOR REBUILDING, REPAIRING, REPLACING AND
HARDENING OF MUNICIPAL PROPERTY DAMAGED BY A FLOOD; CREATING A
MUNICIPAL FLOOD RECOVERY GROSS RECEIPTS TAX FOR THE PAYMENT OF
FLOOD RECOVERY REVENUE BONDS; PROVIDING A GOVERNMENTAL GROSS
RECEIPTS TAX DEDUCTION FOR THE SALE OF SERVICES AND PROPERTY TO
A MUNICIPALITY FOR THE REBUILDING, REPAIRING, REPLACING OR
HARDENING OF THE MUNICIPALITY'S PROPERTY DAMAGED BY A FLOOD;
PROVIDING A DELAYED REPEAL OF THE GOVERNMENTAL GROSS RECEIPTS
TAX DEDUCTION; DECLARING AN EMERGENCY.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. Section 3-31-1 NMSA 1978 (being Laws 1973,
Chapter 395, Section 3, as amended) is amended to read:
"3-31-1. REVENUE BONDS--AUTHORITY TO ISSUE--PLEDGE OF
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REVENUES--LIMITATION ON TIME OF ISSUANCE.--
A. In addition to any other law and constitutional
home rule powers authorizing a municipality to issue revenue
bonds, a municipality may issue revenue bonds pursuant to
Chapter 3, Article 31 NMSA 1978 for the purposes specified in
this section.
B. Utility revenue bonds may be issued for
acquiring, extending, enlarging, bettering, repairing or
otherwise improving a municipal utility or for any combination
of the foregoing purposes. The municipality may pledge
irrevocably any or all of the net revenues from the operation
of the municipal utility or of any one or more of other such
municipal utilities for payment of the interest on and
principal of the revenue bonds.
C. Joint utility revenue bonds may be issued for
acquiring, extending, enlarging, bettering, repairing or
otherwise improving joint water facilities, sewer facilities,
gas facilities or electric facilities or for any combination of
the foregoing purposes. The municipality may pledge
irrevocably any or all of the net revenues from the operation
of these municipal utilities for the payment of the interest on
and principal of the bonds.
D. Gross receipts tax revenue bonds may be issued
for any municipal purpose. A municipality may pledge
irrevocably any or all of the gross receipts tax revenue
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received by the municipality pursuant to Section 7-1-6.4 or
7-1-6.12 NMSA 1978 to the payment of the interest on and
principal of the gross receipts tax revenue bonds or for any
area of municipal government services. A law that imposes or
authorizes the imposition of a tax authorized by the Municipal
Local Option Gross Receipts and Compensating Taxes Act or that
affects the tax, or a law supplemental thereto or otherwise
appertaining thereto, shall not be repealed or amended or
otherwise directly or indirectly modified in such a manner as
to impair adversely any outstanding revenue bonds that may be
secured by a pledge of such tax unless the outstanding revenue
bonds have been discharged in full or provision has been fully
made therefor. Revenues in excess of the annual principal and
interest due on gross receipts tax revenue bonds secured by a
pledge of gross receipts tax revenue may be accumulated in a
debt service reserve account. The governing body of the
municipality may appoint a commercial bank trust department to
act as trustee of the gross receipts tax revenue and to
administer the payment of principal of and interest on the
bonds.
E. Gasoline tax revenue bonds may be issued for
laying off, opening, constructing, reconstructing, resurfacing,
maintaining, acquiring rights of way, repairing and otherwise
improving municipal buildings, alleys, streets, public roads
and bridges or any combination of the foregoing purposes. The
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municipality may pledge irrevocably any or all of the gasoline
tax revenue received by the municipality to the payment of the
interest on and principal of the gasoline tax revenue bonds.
F. Project revenue bonds may be issued for
acquiring, extending, enlarging, bettering, repairing,
improving, constructing, purchasing, furnishing, equipping and
rehabilitating any revenue-producing project, including, where
applicable, purchasing, otherwise acquiring or improving the
ground therefor, including acquiring and improving parking
lots, or for any combination of the foregoing purposes. The
municipality may pledge irrevocably any or all of the net
revenues from the operation of the revenue-producing project
for which the particular project revenue bonds are issued to
the payment of the interest on and principal of the project
revenue bonds. The net revenues of any revenue-producing
project may not be pledged to the project revenue bonds issued
for a revenue-producing project that clearly is unrelated in
nature; but nothing in this subsection shall prevent the pledge
to such project revenue bonds of any revenues received from
existing, future or disconnected facilities and equipment that
are related to and that may constitute a part of the particular
revenue-producing project. A general determination by the
governing body that any facilities or equipment is reasonably
related to and constitutes a part of a specified revenue-
producing project shall be conclusive if set forth in the
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proceedings authorizing the project revenue bonds.
G. Fire district revenue bonds may be issued for
acquiring, extending, enlarging, bettering, repairing,
improving, constructing, purchasing, furnishing, equipping and
rehabilitating any fire district project, including, where
applicable, purchasing, otherwise acquiring or improving the
ground therefor, or for any combination of the foregoing
purposes. The municipality may pledge irrevocably any or all
of the revenues received by the fire district from the fire
protection fund as provided in the Fire Protection Fund Law and
any or all of the revenues provided for the operation of the
fire district project for which the particular bonds are issued
to the payment of the interest on and principal of the bonds.
The revenues of any fire district project shall not be pledged
to the bonds issued for a fire district project that clearly is
unrelated in its purpose; but nothing in this section prevents
the pledge to such bonds of any revenues received from
existing, future or disconnected facilities and equipment that
are related to and that may constitute a part of the particular
fire district project. A general determination by the
governing body of the municipality that any facilities or
equipment is reasonably related to and constitutes a part of a
specified fire district project shall be conclusive if set
forth in the proceedings authorizing the fire district bonds.
H. Law enforcement protection revenue bonds may be
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issued for the repair and purchase of law enforcement apparatus
and equipment that meet nationally recognized standards. The
municipality may pledge irrevocably any or all of the revenues
received by the municipality from the law enforcement
protection fund distributions pursuant to the Law Enforcement
Protection Fund Act to the payment of the interest on and
principal of the law enforcement protection revenue bonds.
I. Flood recovery revenue bonds may be issued for
rebuilding, repairing, replacing and hardening of municipal
property damaged by a flood. The municipality shall pledge
irrevocably all of the revenue received by the municipality
from the municipal flood recovery gross receipts tax to the
payment of the interest on and principal of the bonds.
[I.] J. Except for the purpose of refunding
previous revenue bond issues, no municipality may sell revenue
bonds payable from pledged revenues after the expiration of two
years from the date of the ordinance authorizing the issuance
of the bonds or, for bonds to be issued and sold to the New
Mexico finance authority as authorized in Subsection C of
Section 3-31-4 NMSA 1978, after the expiration of two years
from the date of the resolution authorizing the issuance of the
bonds. However, any period of time during which a particular
revenue bond issue is in litigation shall not be counted in
determining the expiration date of that issue."
SECTION 2. Section 3-31-1.1 NMSA 1978 (being Laws 2019,
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Chapter 274, Section 2) is amended to read:
"3-31-1.1. DEFINITIONS.--As used in Chapter 3, Article 31
NMSA 1978:
A. "bond" means any obligation of a municipality
issued under Chapter 3, Article 31 NMSA 1978, whether
designated as a bond, note, loan, warrant, debenture, lease-
purchase agreement or other instrument evidencing an obligation
of a municipality to make payments;
B. "flood recovery revenue bonds" means the bonds
authorized by Subsection I of Section 3-31-1 NMSA 1978;
[B.] C. "gasoline tax revenue" means all or
portions of the amounts of tax revenues distributed to
municipalities pursuant to Sections 7-1-6.9 and 7-1-6.27 NMSA
1978;
[C.] D. "gasoline tax revenue bonds" means the
bonds authorized by Subsection E of Section 3-31-1 NMSA 1978;
[D.] E. "gross receipts tax revenue" means the
amount of money distributed to a municipality pursuant to
Section 7-1-6.4 NMSA 1978 and transferred to a municipality
pursuant to Section 7-1-6.12 NMSA 1978 for any municipal gross
receipts tax imposed pursuant to the Municipal Local Option
Gross Receipts and Compensating Taxes Act;
[E.] F. "gross receipts tax revenue bonds" means
the bonds authorized by Subsection D of Section 3-31-1 NMSA
1978;
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[F.] G. "joint utility revenue bonds" or "joint
utility bonds" means the bonds authorized by Subsection C of
Section 3-31-1 NMSA 1978;
[G.] H. "pledged revenues" means the revenues, net
income or net revenues authorized to be pledged to the payment
of revenue bonds as specifically provided in Chapter 3, Article
31 NMSA 1978;
[H.] I. "project revenue bonds" means the bonds
authorized by Subsection F of Section 3-31-1 NMSA 1978; and
[I.] J. "utility revenue bonds" or "utility bonds"
means the bonds authorized by Subsection B of Section 3-31-1
NMSA 1978."
SECTION 3. A new section of the Municipal Local Option
Gross Receipts and Compensating Taxes Act is enacted to read:
"[NEW MATERIAL] MUNICIPAL FLOOD RECOVERY GROSS RECEIPTS
TAX.--
A. The majority of the members of the governing
body of an eligible municipality may impose by ordinance an
excise tax at a rate not to exceed one-fourth percent of the
gross receipts of a person engaging in business in the
municipality for the privilege of engaging in business. The
tax may be imposed in increments of one-thousandth percent not
to exceed an aggregate rate of one-fourth percent. The tax
shall be imposed until the flood recovery revenue bonds issued
pursuant to Section 3-31-1 NMSA 1978 are fully discharged or
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otherwise provided for in full.
B. The tax imposed pursuant to this section may be
referred to as the "municipal flood recovery gross receipts
tax".
C. A governing body, at the time of enacting an
ordinance imposing a rate of tax authorized in Subsection A of
this section, shall dedicate the revenue only for payment of
flood recovery revenue bonds issued pursuant to Section 3-31-1
NMSA 1978.
D. For the purposes of this section, "eligible
municipality" means a municipality that has a population
greater than forty-five thousand according to the most recent
federal decennial census and that is located in a class B
county having a net taxable value for rate-setting purposes for
the 2023 property tax year or any subsequent year of more than
one billion five hundred million dollars ($1,500,000,000)."
SECTION 4. A new section of the Gross Receipts and
Compensating Tax Act is enacted to read:
"[NEW MATERIAL] DEDUCTION--GOVERNMENTAL GROSS RECEIPTS--
CERTAIN RECEIPTS TO A MUNICIPALITY FOR FLOOD RECOVERY.--
A. Prior to July 1, 2028, receipts from selling a
service or tangible personal property to an eligible
municipality may be deducted from governmental gross receipts
if the services and tangible personal property are used
exclusively for the rebuilding, repairing, replacing or
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hardening of the municipality's property that was damaged by a
flood.
B. A taxpayer allowed a deduction pursuant to this
section shall report separately the amount of the deduction and
detail exactly what was sold in a manner required by the
department.
C. The deduction provided by this section shall be
included in the tax expenditure budget pursuant to Section
7-1-84 NMSA 1978, including the annual aggregate cost of the
deductions.
D. As used in this section, "eligible municipality"
means a municipality that has a population greater than
forty-five thousand according to the most recent federal
decennial census and that is located in a class B county having
a net taxable value for rate-setting purposes for the 2023
property tax year or any subsequent year of more than one
billion five hundred million dollars ($1,500,000,000)."
SECTION 5. DELAYED REPEAL.--Section 4 of this act is
repealed effective July 1, 2028.
SECTION 6. EFFECTIVE DATE.--The effective date of the
provisions of this act is the first day of the month following
the date this act takes effect.
SECTION 7. EMERGENCY.--It is necessary for the public
peace, health and safety that this act take effect immediately.
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