SENATE BILL 393

55th legislature - STATE OF NEW MEXICO - first session, 2021

INTRODUCED BY

Gerald Ortiz y Pino

 

 

 

 

 

AN ACT

RELATING TO CAPITAL EXPENDITURES; ENACTING THE VIBRANT COMMUNITIES ACT; AMENDING AND ENACTING SECTIONS OF THE NMSA 1978.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     SECTION 1. [NEW MATERIAL] SHORT TITLE.--Sections 1 through 10 of this act may be cited as the "Vibrant Communities Act".

     SECTION 2. [NEW MATERIAL] DEFINITIONS.--As used in the Vibrant Communities Act:

          A. "community well-being and capital development project" means the provision of direct or indirect assistance to a qualifying entity by the state, a county or a municipal government to assist a qualifying entity that serves New Mexico's sick and indigent residents and that promotes health, self-sufficiency and community and economic development, thereby strengthening the resources of the community in which it is located, and includes:

                (1) the purchase, lease or other acquisition of land or buildings;

                (2) the purchase, lease or other acquisition or the construction or improvement of buildings or other infrastructure;

                (3) public works improvements essential to the location or expansion of a qualifying entity; and

                (4) payments for professional services contracts necessary for a county or municipal government to implement a plan or project;

          B. "department" means the department of finance and administration;

          C. "health council" means the county, tribal or regional health council;

          D. "local government" means a municipality or county;

          E. "municipality" means any incorporated city, town or village;

          F. "public purpose" means a purpose that serves the community; and

          G. "qualifying entity" means:

                (1) an organization recognized as tax exempt pursuant to Section 501(c)(3) of the federal Internal Revenue Code of 1986, as amended;

                (2) an organization recognized as a cooperative pursuant to Section 501(c)(12) of the federal Internal Revenue Code of 1986, as amended; or

                (3) a federally chartered tribal corporation, business or person.

     SECTION 3. [NEW MATERIAL] COMMUNITY WELL-BEING AND CAPITAL DEVELOPMENT PROJECTS--RESTRICTIONS ON PUBLIC EXPENDITURES OR PLEDGES OF CREDIT.--

          A. 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 county or municipality for community well-being and capital development projects pursuant to the Vibrant Communities Act shall not exceed five percent of the annual general fund expenditures of the county or municipality in that fiscal year. The value of any land or building contributed to any project pursuant to a project participation agreement shall not be subject to the limits of this subsection.

          B. The restriction set forth in Subsection A of this section does not include contractual agreements for the purchase of services.

     SECTION 4. [NEW MATERIAL] COMMUNITY WELL-BEING AND CAPITAL DEVELOPMENT PROJECTS AND PUBLIC PURPOSE.--A qualifying entity seeking to pursue community well-being and capital development projects shall provide a project proposal to the department, to the appropriate health council, if any, and to appropriate counties and municipalities and involved Indian nations, tribes or pueblos. The project proposal shall include:

          A. a description of the community need or public purpose;

          B. a description of the project;

          C. the state agencies that may have authority over the project;

          D. the amount of funding being requested from the state; and

          E. a list of other funding sources for the project, if any.

     SECTION 5. [NEW MATERIAL] COMMUNITY WELL-BEING AND CAPITAL DEVELOPMENT PROJECT APPLICATIONS.--An application for funding community well-being and capital development projects shall be on a form and require such information as the department deems necessary. The application deadline shall be April 30 of each year.

     SECTION 6. [NEW MATERIAL] PROJECT EVALUATION-- DEPARTMENT.--

          A. The department shall designate the appropriate state agency to oversee the proposed community well-being and capital development project.

          B. The designated state agency shall review each project proposal and provide confirmation in writing that it has reviewed the proposed community well-being and capital development project.

          C. The designated state agency may negotiate with a qualifying entity on the type or amount of assistance to be provided or on the scope of the community well-being and capital development project.

          D. If a designated state agency refuses to approve a community well-being and capital development project, it shall provide information in writing to the requesting entity regarding the reasons for not promoting the project.

     SECTION 7. [NEW MATERIAL] PROJECT PARTICIPATION AGREEMENT--DUTIES AND REQUIREMENTS.--

          A. The state agency designated pursuant to Subsection A of Section 6 of the Vibrant Communities Act, participating counties and municipalities and the qualifying entity shall enter into a project participation agreement.

          B. A county or municipality shall hold a public hearing concerning a proposed community well-being and capital development project before entering into a participation agreement for such a project.

          C. The designated state agency shall require a substantive contribution from the qualifying entity for each community well-being and capital development project. The contribution shall be of value and may be in-kind services, jobs, property or other thing or service of value for the expansion of community well-being.

          D. The participation agreement at a minimum shall set out:

                (1) the contributions to be made by each party to the participation agreement;

                (2) the security provided to the state or county or municipal government by the qualifying entity in the form of a lien and the pledge of the qualifying entity's financial or material participation and cooperation to guarantee the qualifying entity's performance pursuant to the project participation agreement;

                (3) a schedule for project development and implementation, including measurable goals and time limits for those goals;

                (4) who will manage the funds associated with the proposed community well-being and capital development project;

                (5) provisions for performance review and actions to be taken upon a determination that project performance is unsatisfactory; and

                (6) terms of ownership of the property or asset, including a schedule of depreciation and a schedule of payments through services, with the asset or property to be the responsibility of the qualifying entity receiving public funds and held in trust so long as the qualifying entity continues to serve a public purpose.

          E. If the qualifying entity ceases to exist or to serve a public purpose, then the property or asset shall revert ownership to the county or municipal government or, with the approval of the designated state agency and an involved county or municipal government, to another tax-exempt organization or cooperative that meets the requirements of a qualifying entity pursuant to Subsection G of Section 2 of the Vibrant Communities Act.

          F. If the qualifying entity ceases to exist or no longer serves a public purpose, and there is no outstanding lien or mortgage on the property or asset, the state agency or local government may assume ownership of the property or asset itself or transfer ownership of the property or asset to another qualifying entity.

     SECTION 8. [NEW MATERIAL] PROJECT REVENUES--THIRD PARTY MANAGEMENT.--State funds dedicated or pledged for funding or financing of community well-being and capital development projects shall be managed by the entity as agreed to in the project participation agreement and overseen by the state agency designated pursuant to Subsection A of Section 6 of the Vibrant Communities Act. Money shall be expended only for community well-being and capital development project purposes, which may include the payment of necessary professional services contract costs.

     SECTION 9. [NEW MATERIAL] PLAN AND PROJECT TERMINATION.--

          A. At any time after approval of a community well-being and capital development project, the state agency designated pursuant to Subsection A of Section 6 of the Vibrant Communities Act may terminate it by providing written notification giving thirty days' notice. If the designated state agency terminates a community well-being and capital development project, the party managing the funds as provided in the participation agreement shall provide for satisfying existing contracts and the rights of the parties arising from those contracts.

          B. Any unexpended and unencumbered balances remaining in any project fund upon termination of a project shall be transferred to the general fund of the state.

     SECTION 10. [NEW MATERIAL] LIMITATIONS.--Nothing in the Vibrant Communities Act shall be construed to affect any other requirements of the constitution of New Mexico or other laws regarding local government debt, issuance of bonds, use of tax revenues or the grant, lease or sale of land or other property.

     SECTION 11. Section 3-54-3 NMSA 1978 (being Laws 1965, Chapter 300, Section 14-55-3, as amended) is amended to read:

     "3-54-3. SUPPLEMENTAL METHOD FOR DISPOSING OF MUNICIPAL PROPERTY.--Sections 3-54-1 and 3-54-2 NMSA 1978 are intended to afford another and additional method of disposing of municipal real and personal property and are not to be construed as repealing or qualifying any other statutory authorization granted a municipality to dispose of or exchange real or personal municipal property or as affecting in any way the sale, lease, exchange or other disposition of real or personal property pursuant to the Local Economic Development Act or the Vibrant Communities Act."

     SECTION 12. SEVERABILITY.--If any part or application of the Vibrant Communities Act is held invalid, the remainder or its application to other situations or persons shall not be affected.

     SECTION 13. EFFECTIVE DATE.--The effective date of the provisions of this act is the date the secretary of state certifies that the constitution of New Mexico has been amended as proposed by a joint resolution of the first session of the

fifty-fifth legislature entitled "A JOINT RESOLUTION PROPOSING TO AMEND ARTICLE 9, SECTION 14 OF THE CONSTITUTION OF NEW MEXICO TO PERMIT, UNDER CERTAIN CONDITIONS, THE STATE OR ANY COUNTY OR MUNICIPALITY TO PROVIDE REAL ESTATE, EQUIPMENT OR MONEY TO BE USED BY NONPROFIT ORGANIZATIONS AND COOPERATIVES THAT PROVIDE GOODS OR SERVICES TO THE PUBLIC ON BEHALF OF THE STATE OR A COUNTY OR MUNICIPALITY".

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