This bill establishes a requirement for the state of New Mexico to make annual payments in lieu of taxes to political subdivisions when it acquires real property, either through purchase or eminent domain. These payments will begin in the calendar year following the acquisition and will continue as long as the state retains ownership of the property. State agencies must inquire about the annual property tax liability of the property prior to acquisition and remit an amount equal to that liability to the state treasurer for deposit into a newly created "payments in lieu of taxes fund." The bill also specifies that these payments are contingent upon sufficient appropriations from the legislature and exempts properties acquired by the Department of Transportation for public roadways or highways from this requirement.

Additionally, the bill creates the "payments in lieu of taxes fund" as a nonreverting fund within the state treasury, which will consist of various sources of funding, including appropriations and donations. The taxation and revenue department will administer this fund, which is specifically allocated for making payments to political subdivisions in lieu of taxes for state-acquired real property. Disbursements from the fund will be managed by the secretary of finance and administration, following the necessary protocols for vouchers. The provisions of this act are set to take effect on July 1, 2025.