SENATE BILL 448

53rd legislature - STATE OF NEW MEXICO - first session, 2017

INTRODUCED BY

Gerald Ortiz y Pino

AN ACT

RELATING TO TAXATION; REPEALING CERTAIN HEALTH CARE INDUSTRY EXEMPTIONS FROM THE GROSS RECEIPTS TAX; CREATING THE MEDICAID TRUST FUND; MAKING AN APPROPRIATION.

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

     SECTION 1. Section 7-1-6.38 NMSA 1978 (being Laws 1994, Chapter 145, Section 1, as amended) is amended to read:

     "7-1-6.38. DISTRIBUTION--GOVERNMENTAL GROSS RECEIPTS TAX.--

          A. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made in amounts equal to the following percentages of the net receipts attributable to the governmental gross receipts tax, less the net receipts attributable to an entity licensed by the department of health that is principally engaged in providing health care services:

                (1) seventy-five percent to the public project revolving fund administered by the New Mexico finance authority; [in an amount equal to seventy-five percent of the net receipts attributable to the governmental gross receipts tax.

          B. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made]

                (2) twenty-four percent to the energy, minerals and natural resources department [in an amount equal to twenty-four percent of the net receipts attributable to the governmental gross receipts tax]; provided that forty-one and two-thirds percent of the distribution is appropriated to the energy, minerals and natural resources department to implement the provisions of the New Mexico Youth Conservation Corps Act and fifty-eight and one-third percent of the distribution is appropriated to the energy, minerals and natural resources department for state park and recreation area capital improvements, including the costs of planning, engineering, design, construction, renovation, repair, equipment and furnishings; and

          [C. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made]

                (3) one percent to the [office of] cultural affairs [in an amount equal to one percent of the net receipts attributable to the governmental gross receipts tax] department for capital improvements at state museums and monuments administered by the [office of] cultural affairs department.

          [D.] B. The state pledges to and agrees with the holders of any bonds or notes issued by the New Mexico finance authority or by the energy, minerals and natural resources department and payable from the net receipts attributable to the governmental gross receipts tax distributed to the New Mexico finance authority or the energy, minerals and natural resources department pursuant to this section that the state will not limit, reduce or alter the distribution of the net receipts attributable to the governmental gross receipts tax to the New Mexico finance authority or the energy, minerals and natural resources department or limit, reduce or alter the rate of imposition of the governmental gross receipts tax until the bonds or notes together with the interest thereon are fully met and discharged. The New Mexico finance authority and the energy, minerals and natural resources department are authorized to include this pledge and agreement of the state in any agreement with the holders of the bonds or notes."

     SECTION 2. Section 7-9-4.3 NMSA 1978 (being Laws 1991, Chapter 8, Section 2, as amended by Laws 1993, Chapter 332, Section 1 and by Laws 1993, Chapter 352, Section 1) is amended to read:

     "7-9-4.3. IMPOSITION AND RATE OF TAX--DENOMINATION AS "GOVERNMENTAL GROSS RECEIPTS TAX".--For the privilege of engaging in certain activities by governments, there is imposed on every agency, institution, instrumentality or political subdivision of the state, except any school district [and any entity licensed by the department of health that is principally engaged in providing health care services], an excise tax of five percent of governmental gross receipts. The tax imposed by this section shall be referred to as the "governmental gross receipts tax"."

     SECTION 3. Section 7-9-29 NMSA 1978 (being Laws 1970, Chapter 12, Section 3, as amended) is amended to read:

     "7-9-29. EXEMPTION--GROSS RECEIPTS TAX--CERTAIN ORGANIZATIONS.--

          A. Exempted from the gross receipts tax are the receipts of organizations, except an entity licensed by the department of health that is principally engaged in providing health care services, that demonstrate to the department that they have been granted exemption from the federal income tax by the United States commissioner of internal revenue as organizations described in Section 501(c)(3) of the United States Internal Revenue Code of [1954] 1986, as that section may be amended or renumbered.

          B. Exempted from the gross receipts tax are the receipts from carrying on chamber of commerce, visitor bureau and convention bureau functions of organizations that demonstrate to the department that they have been granted exemption from the federal income tax by the United States commissioner of internal revenue as organizations described in Section 501(c)(6) of the United States Internal Revenue Code of [1954] 1986, as that section may be amended or renumbered.

          C. This section does not apply to receipts derived from an unrelated trade or business as defined in Section 513 of the United States Internal Revenue Code of [1954] 1986, as that section may be amended or renumbered."

     SECTION 4. A new section of the Statewide Health Care Act is enacted to read:

     "[NEW MATERIAL] MEDICAID TRUST FUND CREATED--USE--

APPROPRIATION BY LEGISLATURE.--The "medicaid trust fund" is

created in the state treasury. The fund shall consist of

distributions, appropriations, gifts, grants, donations and

bequests made to the fund. All income earned on investment of

the fund shall be credited to the fund, and money in the fund

shall not revert to any other fund at the end of a fiscal year.

Money in the fund may be appropriated by the legislature only

to support the state medicaid program."

     SECTION 5. A new section of the Tax Administration Act is enacted to read:

     "[NEW MATERIAL] DISTRIBUTION--MEDICAID TRUST FUND FROM GROSS RECEIPTS TAX.--A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the medicaid trust fund in an amount equal to two and four-tenths percent of the net receipts attributable to the gross receipts tax."

     SECTION 6. REPEAL.--Sections 7-9-73.1 and 7-9-96.1 NMSA 1978 (being Laws 1991, Chapter 8, Section 3 and Laws 2007, Chapter 361, Section 7, as amended) are repealed.

     SECTION 7. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2017.

- 6 -