2018 New Mexico Statutes
Chapter 5 - Municipalities and Counties
Article 10 - Local Economic Development
Section 5-10-4 - Economic development projects; restrictions on public expenditures or pledges of credit.

A. No local or regional government shall provide public support for economic development projects as permitted pursuant to Article 9, Section 14 of the constitution of New Mexico except as provided in the Local Economic Development Act or as otherwise permitted by law.

B. The total amount of public money expended and the value of credit pledged in the fiscal year in which that money is expended by a local government for economic development projects pursuant to Article 9, Section 14 of the constitution of New Mexico and the Local Economic Development Act shall not exceed ten percent of the annual general fund expenditures of the local government in that fiscal year. The limits of this subsection shall not apply to:

(1) the value of any land or building contributed to any project pursuant to a project participation agreement;

(2) revenue generated through the imposition of the municipal infrastructure gross receipts tax pursuant to the Municipal Local Option Gross Receipts Taxes Act [Chapter 7, Article 19D NMSA 1978] for furthering or implementing economic development plans and projects as defined in the Local Economic Development Act or projects as defined in the Statewide Economic Development Finance Act [Chapter 6, Article 25 NMSA 1978]; provided that no more than the greater of fifty thousand dollars ($50,000) or ten percent of the revenue collected shall be used for promotion and administration of or professional services contracts related to the implementation of any such economic development plan adopted by the governing body;

(3) revenue generated through the imposition of a county infrastructure gross receipts tax pursuant to the County Local Option Gross Receipts Taxes Act [Chapter 7, Article 20E NMSA 1978] for furthering or implementing economic development plans and projects as defined in the Local Economic Development Act or projects as defined in the Statewide Economic Development Finance Act; provided that no more than the greater of fifty thousand dollars ($50,000) or ten percent of the revenue collected shall be used for promotion and administration of or professional services contracts related to the implementation of any such economic development plan adopted by the governing body;

(4) the proceeds of a revenue bond issue to which municipal infrastructure gross receipts tax revenue is pledged;

(5) the proceeds of a revenue bond issue to which county infrastructure gross receipts tax revenue is pledged; or

(6) funds donated by private entities to be used for defraying the cost of a project.

C. A regional or local government that generates revenue for economic development projects to which the limits of Subsection B of this section do not apply shall create an economic development fund into which such revenues shall be deposited. The economic development fund and income from the economic development fund shall be deposited as provided by law. Money in the economic development fund may be expended only as provided in the Local Economic Development Act or the Statewide Economic Development Finance Act.

D. In order to expend money from an economic development fund for arts and cultural district purposes, cultural facilities or retail businesses, the governing body of a municipality or county that has imposed a municipal or county local option infrastructure gross receipts tax for furthering or implementing economic development plans and projects as defined in the Local Economic Development Act or projects as defined in the Statewide Economic Development Finance Act by referendum of the majority of the voters voting on the question approving the ordinance imposing the municipal or county infrastructure gross receipts tax before July 1, 2013 shall be required to adopt a resolution. The resolution shall call for an election to approve arts and cultural districts as a qualifying purpose and cultural facilities or retail businesses as a qualifying entity before any revenue generated by the municipal or county local option gross receipts tax for furthering or implementing economic development plans and projects as defined in the Local Economic Development Act or projects as defined in the Statewide Economic Development Finance Act can be expended from the economic development fund for arts and cultural district purposes, cultural facilities or retail businesses.

E. The governing body shall adopt a resolution calling for an election within seventy-five days of the date the ordinance is adopted on the question of approving arts and cultural districts as a qualifying purpose and cultural facilities or retail businesses as a qualifying entity eligible to utilize revenue generated by the Municipal Local Option Gross Receipts Taxes Act or the County Local Option Gross Receipts Taxes Act for furthering or implementing economic development plans and projects as defined in the Local Economic Development Act or projects as defined in the Statewide Economic Development Finance Act.

F. The question shall be submitted to the voters of the municipality or county as a separate question at a regular local or county election or at a special election called for that purpose by the governing body. A special local election shall be called, conducted and canvassed as provided in the Local Election Act [Chapter 1, Article 22 NMSA 1978]. A special county election shall be called, conducted and canvassed in substantially the same manner as provided by law for general elections.

G. If a majority of the voters voting on the question approves the ordinance adding arts and cultural districts and cultural facilities or retail businesses as an approved use of the local option municipal or county economic development infrastructure gross receipts tax fund, the ordinance shall become effective on July 1 or January 1, whichever date occurs first after the expiration of three months from the date of the adopted ordinance. The ordinance shall include the effective date.

History: Laws 1993, ch. 297, § 4; 1998, ch. 90, § 4; 2003, ch. 349, § 17; 2007, ch. 160, § 10; 2009, ch. 172, § 1; 2013, ch. 201, § 2; 2018, ch. 79, § 73.

The 2018 amendment, effective July 1, 2018, provided that elections called to approve arts and cultural districts as a qualifying purpose and cultural facilities or retail businesses as a qualifying entity for the purpose of expending funds from the economic development fund for arts and cultural district purposes shall be called, conducted and canvassed as provided in the Local Election Act, and made technical and conforming changes; and in Subsection F, deleted "municipal" and added "local" in two places, and after "as provided in the", deleted "Municipal Election Code" and added "Local Election Act".

Temporary provisions. — Laws 2018, ch. 79, § 174 provided that references in law to the Municipal Election Code and to the School Election Law shall be deemed to be references to the Local Election Act.

The 2013 amendment, effective July 1, 2013, removed the restriction on public support of economic development projects in rural areas involving retail sales; in Subsection D, after "cultural facilities", added "or retail businesses" and after "gross receipts tax before" deleted "June 30, 2007" and added "July 1, 2013" and in the second sentence, after "qualifying purpose and cultural facilities", added "or retail businesses" and after "cultural district purposes, cultural facilities", added phrase "or retail businesses"; in Subsection E, after "cultural facilities", added "or retail businesses"; and in Subsection G, after "cultural facilities", added "or retail businesses".

The 2009 amendment, effective June 19, 2009, in Subsection B, after "shall not exceed", changed "five" to "ten".

The 2007 amendment, effective July 1, 2007, added Subsections D through G.

The 2003 amendment, effective June 20, 2003, inserted "or projects as defined in the Statewide Economic Development Finance Act" in Paragraphs B(2) and (3); and added "or the Statewide Economic Development Finance Act" to the end of Subsection C.

The 1998 amendment, effective May 20, 1998, in Subsection B, added the last sentence at the end of the introductory language, designated Paragraph B(1), deleted "shall not be subject to the limits of this subsection" at the end of the paragraph, and added Paragraphs B(2) through (6); and added Subsection C.