2006 New Mexico Statutes - Section 3-46-45 — Alternative method of financing.

3-46-45. Alternative method of financing.

A.     Effective for tax years beginning on or after January 1, 1975, the local governing body of a municipality may elect by resolution to use the tax increment method of financing urban renewal projects. This method may be used in addition to or in conjunction with other methods of financing such projects.   

B.     The tax increment method, for the purpose of financing urban renewal projects, is the dedication for further use in urban renewal projects of that increase in property tax revenue directly resulting from the increased net taxable value of a parcel of property attributable to its rehabilitation, redevelopment or other improvement because of its inclusion within an urban renewal project.   

C.     The procedures to be used in the tax increment method are as follows:   

(1)     the local governing body of the municipality shall at the time of approval of an urban renewal project notify the county assessor and the property tax division of the taxation and revenue department of the taxable parcels of property within the project;   

(2)     upon receipt of this notification the county assessor and the property tax division shall identify the parcels of property within the urban renewal project within their respective jurisdictions and certify to the county treasurer the net taxable value of the property at the time of notification as the base value for the distribution of property tax revenues authorized by the Property Tax Code [Articles 35 to 38 of Chapter 7 NMSA 1978]. If because of acquisition by the municipality the property becomes tax exempt, the county assessor and the property tax division shall note that fact on their respective records and so notify the county treasurer, but the county assessor, the property tax division and the county treasurer shall preserve the next [sic] taxable value at the time of inclusion of the property within the urban renewal project as the base value for the purpose of distribution of property tax revenues when the parcel again becomes taxable. The county assessor is not required by this section to preserve the new taxable value at the time of inclusion of the property within the urban renewal project as the base value for the purposes of valuation of the property;   

(3)     if because of acquisition by the municipality the property becomes tax exempt, when the parcel again becomes taxable, the local governing body of the municipality shall notify the county assessor and the property tax division of the parcels of property which because of their rehabilitation or other improvement are to be revalued for property tax purposes. A new taxable value of this property shall then be determined by the county assessor or by the property tax division if the property is within the valuation jurisdiction of the division. If no acquisition by the municipality occurs, improvement or rehabilitation of property subject to valuation by the assessor shall be reported to the assessor as required by the Property Tax Code and the new taxable value shall be determined as of January 1 of the tax year following the year in which the improvement or rehabilitation is begun;   

(4)     current tax rates shall then be applied to the new taxable value. The amount by which the revenue received exceeds that which would have been received by application of the same rates to the base value before inclusion in the urban renewal project shall be credited to the municipality and deposited in the "municipal urban development fund" hereby created. The remaining revenue shall be distributed to participating units of government as authorized by the Property Tax Code;   

(5)     the procedures and methods contained herein shall be followed annually for a maximum period of five years following the date of notification of inclusion of property within an urban renewal project;   

(6)     money in the municipal urban development fund shall be disbursed to the municipality to be used as other money is authorized to be used in the Urban Development Law [ 3-46-1 to 3-46-45 NMSA 1978]; and   

(7)     the tax increment method shall be used only upon prior approval by a majority of the units of government participating in property tax revenue derived from property within an urban renewal project. The local government of the municipality shall annually request such approval. The governor, or his authorized representative, shall approve or disapprove the use of the method for the state government: the governing body of each other participating unit shall approve or disapprove by ordinance or resolution the use of the method for their respective units. All participating units shall notify the local governing body of the municipality seeking approval within thirty days of receipt of the request. If notice of disapproval by the governor or any other participating unit has not been received at the expiration of forty-five days from the date of sending the request, the local governing body of the municipality shall assume approval by the governor or the other participating units, respectively, of use of the method.   

D.     If the tax increment method of financing urban renewal projects is used, the base value for distribution of property tax revenues shall be the value used in calculating the limit of general obligation indebtedness imposed by the constitution and statutes.