This bill mandates the Local Government Division of the Department of Finance and Administration to offer zero-interest loans to political subdivisions in New Mexico for projects aimed at replacing or repairing public infrastructure damaged by flooding or debris flows, specifically related to the storm event on October 19, 2024. To qualify for these loans, political subdivisions must be approved for federal public assistance funding. The bill stipulates that a reimbursement contract must be established, requiring the political subdivision to repay the loan using the first funds received from the federal assistance, within thirty days of receipt. If the subdivision fails to meet these requirements, the loan will incur current market interest rates.

Additionally, the bill appropriates $150 million from the general fund for the local government division to facilitate these loans during fiscal years 2027 and 2028, with any unspent funds reverting to the general fund at the end of that period. The provisions of this act are set to take effect on July 1, 2026.