The Public Finance Accountability Act establishes new funding criteria and grant management requirements for state agencies in New Mexico. It mandates that grantees must complete an annual audit and address any identified material weaknesses or deficiencies before being eligible for capital outlay appropriations or special purpose appropriations. The Department of Finance and Administration is tasked with creating specific criteria for grantees, which includes ensuring compliance with financial reporting requirements and having an approved budget. Additionally, the Act outlines the responsibilities of state agencies in managing grants, including the approval of sales, leases, and licenses of capital assets acquired with appropriations.

Furthermore, the Act requires the Department of Finance and Administration to develop procedures and templates for grant agreements, monitor compliance with the established funding criteria, and conduct field audits of capital outlay projects. The provisions of this Act will take effect on July 1, 2025.