This bill establishes new limitations and requirements for capital outlay projects in New Mexico, specifically addressing reauthorizations and appropriations. It stipulates that a capital outlay project cannot be reauthorized or reappropriated more than once, for a period exceeding two years, or unless at least ten percent of the initial appropriation has been encumbered by January 1 of that year. Additionally, capital outlay projects with appropriations of $100,000 or more must be included in an infrastructure capital improvement plan. The bill also mandates that unexpended general fund capital outlay appropriations revert to the capital development and reserve fund or the tribal infrastructure project fund, depending on the nature of the project.

Furthermore, the bill prohibits political subdivisions from requesting funding for drinking water, wastewater, storm water, or dam capital projects through the legislature's capital outlay process, directing them instead to submit requests to relevant state agencies. The bill amends existing laws from 2022 to 2025 to ensure that unexpended balances of appropriations revert to the appropriate funds by specified deadlines, with new provisions for reversion timelines included for appropriations made in subsequent years. The provisions of the bill will apply to capital outlay appropriations made on or after January 1, 2027.