This bill establishes a requirement for the state of New Mexico to make annual payments in lieu of taxes to political subdivisions when the state acquires real property 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. The bill mandates that state agencies inquire about the annual property tax liability 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." Additionally, the bill specifies that these payments are contingent upon sufficient appropriations from the New Mexico legislature.

The legislation also 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 is tasked with administering this fund, which is designated for making payments to political subdivisions in accordance with the new provisions. Notably, the bill exempts property acquired by the department of transportation for public roadways or highways from these payment requirements. The effective date for the provisions of this act is set for July 1, 2025.