SENATE BILL 105

56th legislature - STATE OF NEW MEXICO - second session, 2024

INTRODUCED BY

William E. Sharer

 

 

 

 

 

AN ACT

RELATING TO TAXATION; AMENDING THE TAX BRACKETS PURSUANT TO THE INCOME TAX ACT AND CORPORATE INCOME AND FRANCHISE TAX ACT; REDUCING THE RATES OF THE GROSS RECEIPTS TAX, GOVERNMENTAL GROSS RECEIPTS TAX, COMPENSATING TAX, LEASED VEHICLE GROSS RECEIPTS TAX AND GAMING TAX ON MANUFACTURER LICENSEES ON THE TRANSFER OF GAMING DEVICES AND INCREASING THE RATE OF THE BINGO AND RAFFLE TAX; REMOVING AUTHORIZATION FOR THE USE OF A STATE GROSS RECEIPTS TAX INCREMENT TO FUND A METROPOLITAN REDEVELOPMENT PROJECT; REMOVING AUTHORIZATION FOR A TAX INCREMENT DEVELOPMENT DISTRICT TO DEDICATE AN INCREMENT OF THE STATE GROSS RECEIPTS TAX; REPEALING THE ESTATE TAX ACT, ART ACCEPTANCE ACT, INTERSTATE TELECOMMUNICATIONS GROSS RECEIPTS TAX ACT, RAILROAD CAR COMPANY TAX ACT, MOTOR VEHICLE EXCISE TAX ACT, ALTERNATIVE FUEL TAX ACT, COUNTY AND MUNICIPAL GASOLINE TAX ACT AND INSURANCE PREMIUM TAX ACT; REPEALING THE RURAL JOB TAX CREDIT, INVESTMENT CREDIT ACT, LABORATORY PARTNERSHIP WITH SMALL BUSINESS TAX CREDIT ACT, TECHNOLOGY JOBS AND RESEARCH AND DEVELOPMENT TAX CREDIT ACT, HIGH-WAGE JOBS TAX CREDIT, AFFORDABLE HOUSING TAX CREDIT ACT, ALTERNATIVE ENERGY PRODUCT MANUFACTURERS TAX CREDIT ACT AND CERTAIN CREDITS, DEDUCTIONS AND EXEMPTIONS PURSUANT TO THE INCOME TAX ACT, CORPORATE INCOME AND FRANCHISE TAX ACT AND GROSS RECEIPTS AND COMPENSATING TAX ACT; PROVIDING SUNSET DATES FOR CERTAIN CREDITS, DEDUCTIONS AND EXEMPTIONS PURSUANT TO THE INCOME TAX ACT, CORPORATE INCOME AND FRANCHISE TAX ACT AND GROSS RECEIPTS AND COMPENSATING TAX ACT; PROVIDING A DELAYED REPEAL OF THE FILM PRODUCTION TAX CREDIT ACT; REDUCING THE CAPITAL GAINS DEDUCTION PURSUANT TO THE INCOME TAX ACT; ENACTING A GROSS RECEIPTS TAX EXEMPTION FOR DONATIONS TO NONPROFIT ORGANIZATIONS; IMPOSING ADDITIONAL REGISTRATION FEES FOR ELECTRIC AND PLUG-IN HYBRID ELECTRIC VEHICLES; REPEALING CERTAIN GROSS RECEIPTS TAX DISTRIBUTIONS TO MUNICIPALITIES; REPEALING CERTAIN SESSION LAWS THAT ARE NOT YET IN EFFECT; MAKING AN APPROPRIATION.

 

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 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 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 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 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 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. 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, 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. "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. "gasoline tax revenue bonds" means the bonds authorized by Subsection E of Section 3-31-1 NMSA 1978;

          D. "gross receipts tax revenue" means the amount of money [distributed to a municipality pursuant to Section 7-1-6.4 NMSA 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. "gross receipts tax revenue bonds" means the bonds authorized by Subsection D of Section 3-31-1 NMSA 1978;

          F. "joint utility revenue bonds" or "joint utility bonds" means the bonds authorized by Subsection C of Section 3-31-1 NMSA 1978;

          G. "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. "project revenue bonds" means the bonds authorized by Subsection F of Section 3-31-1 NMSA 1978; and

          I. "utility revenue bonds" or "utility bonds" means the bonds authorized by Subsection B of Section 3-31-1 NMSA 1978."

     SECTION 3. Section 3-60A-21 NMSA 1978 (being Laws 1979, Chapter 391, Section 21, as amended) is amended to read:

     "3-60A-21. PROPERTY AND GROSS RECEIPTS TAX INCREMENTS--PROCEDURES.--

          A. The procedures to be used in determining a property tax increment are:

                (1) the local government shall, after approval of a metropolitan redevelopment plan, notify the county assessor of the taxable parcels of property within the metropolitan redevelopment area;

                (2) upon receipt of the notification, the county assessor shall identify the parcels of property within the metropolitan redevelopment area within their respective jurisdictions and certify to the county treasurer the net taxable value of the property at the time of notification as the base value for the distribution of property tax revenues authorized by the Property Tax Code. If because of acquisition by the local government the property becomes tax exempt, the county assessor shall note that fact on their respective records and so notify the county treasurer, but the county assessor and the county treasurer shall preserve a record of the net taxable value at the time of inclusion of the property within the metropolitan redevelopment area as the base value for the purpose of distribution of property tax revenues when the parcel again becomes taxable. The county assessor is not required by this section to preserve the new taxable value at the time of inclusion of the property within the metropolitan redevelopment area as the base value for the purposes of valuation of the property;

                (3) if because of acquisition by the local government the property becomes tax exempt, when the parcel again becomes taxable, the local government shall notify the county assessor of the parcels of property that because of their rehabilitation or other improvement are to be revalued for property tax purposes. A new taxable value of this property shall then be determined by the county assessor. If no acquisition by the local government occurs, improvement or rehabilitation of property subject to valuation by the assessor shall be reported to the assessor as required by the Property Tax Code, and the new taxable value shall be determined as of January 1 of the tax year following the year in which the improvement or rehabilitation is completed; and

                (4) current tax rates shall then be applied to the new taxable value of property included in the metropolitan redevelopment area. The amount by which the revenue received exceeds that which would have been received by application of the same rates to the base value before inclusion in the metropolitan redevelopment area shall be multiplied by the percentage of the increment dedicated by the local government pursuant to Section 3-60A-23 NMSA 1978, credited to the local government and deposited in the metropolitan redevelopment fund. This transfer shall take place only after the county treasurer has been notified to apply the procedures pursuant to this subsection to property included in a metropolitan redevelopment area. Unless the entire metropolitan redevelopment area is specifically included by the local government for purposes of tax increment financing, the payment by the county treasurer to the local government shall be limited to those properties specifically included. The remaining revenue shall be distributed to participating units of government as authorized by the Property Tax Code.

          B. The procedures to be used in determining a gross receipts tax increment are:

                (1) after approval of a metropolitan redevelopment area, a dedication is made pursuant to Section 3-60A-23 NMSA 1978 and at least one hundred twenty days before the effective date of the dedication, the local government shall notify the taxation and revenue department of the geographical area within the metropolitan redevelopment area and the percentages of a gross receipts tax increment;

                (2) within ninety days of receipt of the notification, the taxation and revenue department shall certify to the local government the base year gross receipts tax revenue amounts, which shall be calculated as [(a)] the amount of the local government's local option gross receipts tax revenue attributable to the gross receipts of persons engaging in business in the metropolitan redevelopment area in the previous fiscal year, less any local option gross receipts tax revenue attributable to construction activities located within the metropolitan redevelopment area; and

                     [(b) the amount of state gross receipts tax revenue attributable to the gross receipts of persons engaging in business in the metropolitan redevelopment area in the previous fiscal year, less any state gross receipts tax revenue attributable to construction activities located within the metropolitan redevelopment area and, if the local government is a municipality, any amount distributed to the municipality pursuant to Section 7-1-6.4 NMSA 1978 attributable