The proposed "Reclaimed Water Act" establishes a framework for the creation and operation of reclaimed water authorities in New Mexico. It allows municipalities and counties to request authorization from the Department of Environment to create these authorities, which will promote the use of reclaimed water within their jurisdictions. The act outlines the definitions of key terms, the process for establishing an authority, and the composition and responsibilities of its board of directors. The authorities will be organized as nonprofit corporations and will have the power to manage reclaimed water resources, including the ability to sue, enter contracts, and conduct outreach and educational programs.

Additionally, the act mandates that reclaimed water authorities identify potential uses and customers for reclaimed water, facilitate communication among stakeholders, and assist in negotiations related to reclaimed water transactions. It also includes provisions for the regulation of reclaimed water rates by the Public Regulation Commission, ensuring that rates incentivize the use of reclaimed water. The act is set to take effect on July 1, 2025, and emphasizes the importance of adhering to existing water rights and environmental regulations.