A. A tax increment development plan, as originally approved or as later modified, may contain a provision that gross receipts tax increments collected within the tax increment development area after the effective date of approval of the tax increment development plan may be dedicated for the purpose of securing gross receipts tax increment bonds pursuant to the Tax Increment for Development Act.
B. A municipality may dedicate a portion of a gross receipts tax increment from any of the following taxes to pay the principal of, the interest on and any premium due in connection with the bonds of, loans or advances to, or any indebtedness incurred by, whether funded, refunded, assumed or otherwise, the authority for financing or refinancing, in whole or in part, a tax increment development project within the tax increment development area:
(1) an increment of a municipal option gross receipts tax that is dedicated by the ordinance imposing the increment to the tax increment development project; and
(2) an amount distributed to municipalities pursuant to Sections 7-1-6.4 and 7-1-6.46 NMSA 1978.
C. A county may dedicate a portion of a gross receipts tax increment from any of the following taxes to pay the principal of, the interest on and any premium due in connection with the bonds of, loans or advances to or any indebtedness incurred by, whether funded, refunded, assumed or otherwise, the district for financing or refinancing, in whole or in part, a tax increment development project within the tax increment development area:
(1) an increment of a county option gross receipts tax that is dedicated by the ordinance imposing the increment to the tax increment development project; and
(2) the amount distributed to counties pursuant to Section 7-1-6.47 NMSA 1978.
D. Subject to the provisions of Subsection G of this section, the state board of finance may dedicate a gross receipts tax increment attributable to the state gross receipts tax to pay the financing and refinancing costs, the principal of, the interest on and any premium due in connection with gross receipts tax increment bonds issued to finance a tax increment development project within the tax increment development area; provided that:
(1) beginning July 1, 2029 the increment from the state gross receipts tax is no more than the average of:
(a) the increment from municipal option gross receipts taxes dedicated by resolution by the municipality, if the district is located in a municipality; and
(b) the increment from county option gross receipts taxes dedicated by resolution by the county;
(2) the state board of finance has adopted a resolution dedicating an increment attributable to the state gross receipts tax for the purpose of securing gross receipts tax increment bonds pursuant to Subsection G of this section; and
(3) the dedication shall be conditioned on the gross receipts tax increment bonds being issued no later than four years after the state board of finance has adopted the resolution dedicating the increment.
E. The gross receipts tax increment generated by the imposition of municipal or county option gross receipts taxes specified by statute for particular purposes may nonetheless be dedicated for the purposes of the Tax Increment for Development Act if intent to do so is set forth in the tax increment development plan approved by the governing body, if the purpose for which the increment is intended to be used is consistent with the purposes set forth in the statute authorizing the municipal or county option gross receipts tax.
F. An imposition of a gross receipts tax increment attributable to a gross receipts tax by a taxing entity may be dedicated for the purpose of securing gross receipts tax increment bonds with the agreement of the taxing entity, evidenced by a resolution adopted by a majority vote of that taxing entity. A taxing entity shall not agree to dedicate for the purposes of securing gross receipts tax increment bonds more than seventy-five percent of its gross receipts tax increment attributable to gross receipts taxes by the taxing entity. A resolution of the taxing entity to dedicate a gross receipts tax increment or to increase the dedication of a gross receipts tax increment shall become effective only on January 1 or July 1 of the calendar year.
G. The state board of finance shall condition a dedication of a gross receipts tax increment attributable to the state gross receipts tax on the approval required pursuant to Section 5-15-21 NMSA 1978 and that the initial gross receipts tax increment bonds issuance secured by a portion of the gross receipts tax increment attributable to the state gross receipts tax shall be issued no later than four years after the state board of finance has adopted the resolution making the dedication. Subject to the limitations provided in Subsection D of this section, the state board of finance shall not agree to dedicate more than seventy-five percent of the gross receipts tax increment attributable to the state gross receipts tax within the district. The resolution of the state board of finance shall become effective on January 1 or July 1 of the calendar year following the notification period pursuant to Section 5-15-27 NMSA 1978 and shall find that:
(1) the state board of finance has reviewed the request for the use of the state gross receipts tax;
(2) based upon review by the state board of finance of the applicable tax increment development plan, the dedication by the state board of finance of a portion of the gross receipts tax increment within the district for use in meeting the required goals of the tax increment plan is reasonable and in the best interest of the state; and
(3) based upon the review by the state board of finance, the use of the state gross receipts tax is likely to stimulate the creation of jobs, economic opportunities and general revenue for the state through the addition of new businesses to the state and the expansion of existing businesses within the state; provided that, when reviewing the applicable tax increment development plan to create jobs and economic opportunities, the state board of finance shall prioritize in its consideration net, new full-time economic base jobs that would not have occurred on a similar scale and time line but for the use of the state gross receipts tax increment. The benefit to be evaluated is the marginal benefit of the speed-up in time or the incremental change in job creation above expected normal growth and shall exclude retail jobs, call center jobs and service jobs where the customer is typically on site.
H. The governing body of the jurisdiction in which a tax increment development district has been established shall timely notify the assessor of the county in which the district has been established, the taxation and revenue department and the local government division of the department of finance and administration when:
(1) a tax increment development plan has been approved that contains a provision for the allocation of a gross receipts tax increment;
(2) any outstanding bonds of the district have been paid off; and
(3) the purposes of the district have otherwise been achieved.
History: Laws 2006, ch. 75, § 15; 2009, ch. 179, § 6; 2019, ch. 274, § 8; 2019, ch. 275, § 2.
ANNOTATIONS2019 Multiple Amendments. — Laws 2019, ch. 274, § 8 and Laws 2019, ch. 275, § 2, both effective July 1, 2019, enacted different amendments to this section that can be reconciled. Pursuant to 12-1-8 NMSA 1978, Laws 2019, ch. 275, § 2, as the last act signed by the governor, is set out above and incorporates both amendments. The amendments enacted by Laws 2019, ch. 274, § 8 and Laws 2019, ch. 275, § 2 are described below. To view the session laws in their entirety, see the 2019 session laws on NMOneSource.com.
The nature of the difference between the amendments is that Laws 2019, ch. 274, § 8, removed restrictions on which municipal and county local option tax rates can be pledged for tax increment development projects, and Laws 2019, ch. 275, § 2, eliminated the municipal regional transit gross receipts tax as a gross receipts tax increment that may be used to secure gross receipts tax increment bonds, authorized the state board of finance to dedicate a gross receipts tax increment attributable to the state gross receipts tax to pay the financing and refinancing costs, the principal of, interest on and any premiums due in connection with gross receipts tax increments bonds issued to finance a project within the district.
Laws 2019, ch. 275, § 2, effective July 1, 2019, eliminated the municipal regional transit gross receipts tax as a gross receipts tax increment that may be used to secure gross receipts tax increment bonds, authorized the state board of finance to dedicate a gross receipts tax increment attributable to the state gross receipts tax to pay the financing and refinancing costs, the principal of, interest on and any premiums due in connection with gross receipts tax increments bonds issued to finance a project within the district, in the section heading, added "to secure bonds"; in Subsection A, after the subsection designation, deleted "Notwithstanding any law to the contrary, but in accordance with the provisions of the Tax Increment for Development Act"; in Subsection B, in the introductory paragraph, after the subsection designation, deleted "As to a district formed by a municipality, a portion of any of the following gross receipts tax increments may be paid by the state directly into a special fund of the district" and added "A municipality may dedicate a portion of a gross receipts tax increment from any of the following taxes", deleted former Paragraph B(5) and redesignated former Paragraph B(6) as Paragraph B(5), and deleted former Paragraph B(7); in Subsection C, in the introductory paragraph, after the subsection designation, deleted "As to a district formed by a county, all or a portion of any of the following gross receipts tax increments may be paid by the state directly into a special fund of the district" and added "A county may dedicate a portion of a gross receipts tax increment from any of the following taxes", and deleted former Paragraph C(7); added new Subsection D and redesignated former Subsections D through G as Subsections E through H, respectively; in Subsection G, in the introductory paragraph, after the subsection designation, deleted "An imposition of a gross receipts tax increment attributable to the imposition of the state gross receipts tax within a district less the distributions made pursuant to Section 7-1-6.4 NMSA 1978 may be dedicated for the purpose of securing gross receipts tax increment bonds with the agreement of the state board of finance, evidenced by a resolution adopted by a majority vote of the state board of finance." and added "The state board of finance shall condition a dedication of a gross receipts tax increment attributable to the state gross receipts tax on the approval required pursuant to Sections 5-15-21 NMSA 1978 and that the initial gross receipts tax increment bonds issuance secured by a portion of the gross receipts tax increment attributable to the state gross receipts tax shall be issued no later than four years after the state board of finance has adopted the resolution making the dedication. Subject to the limitations provided in Subsection D of this section", and after "calendar year", added "following the notification period pursuant to Section 5-15-27 NMSA 1978", in Paragraph G(3), after the paragraph designation, added "based upon the review by the state board of finance", and after "businesses within the state;", added the remainder of the subsection.
Laws 2019, ch. 274, § 8, effective July 1, 2019, removed restrictions on which municipal and county local option tax rates can be pledged for tax increment development projects; in Subsection B, Paragraph B(1), after the "municipal option gross receipts tax", deleted "authorized pursuant to the Municipal Local Option Gross Receipts Taxes Act" and added "that is dedicated by the ordinance imposing the increment to the tax increment development project", deleted former Paragraphs B(2) through B(5) and redesignated former Paragraphs B(6) and B(7) as Paragraphs B(2) and B(3), respectively; and in Subsection C, Paragraph C(1), after the "county option gross receipts tax", deleted "authorized pursuant to the County Local Option Gross Receipts Taxes Act" and added "that is dedicated by the ordinance imposing the increment to the tax increment development project", and deleted former Paragraphs C(2) through C(5) and redesignated former Paragraphs C(6) and C(7) as Paragraphs C(2) and C(3), respectively.
Applicability. — Laws 2019, ch. 275, § 10 provided that the provisions of this act shall not apply to dedications of gross receipts tax increments by the state board of finance made prior to the effective date of this act.
The 2009 amendment, effective June 19, 2009, in Subsection C(6), deleted "state gross receipts tax" and added the remainder of the sentence; added Subsection C(7); and in Subsection F, after "with a district", added "less the distributions made pursuant to Section 7-1-6.4 NMSA 1978".