HOUSE BILL 60
54th legislature - STATE OF NEW MEXICO - second session, 2020
Sheryl Williams Stapleton
RELATING TO THE INVESTMENT OF PUBLIC MONEY; PROVIDING FOR THE INVESTMENT OF THE SEVERANCE TAX PERMANENT FUND IN NEW MEXICO RENEWABLE ENERGY BUSINESSES, PROJECTS AND BONDS; ALLOWING DIFFERENTIAL RATES FOR THE INVESTMENTS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. Section 7-27-5 NMSA 1978 (being Laws 1983, Chapter 306, Section 7, as amended) is amended to read:
"7-27-5. INVESTMENT OF SEVERANCE TAX PERMANENT FUND.--The severance tax permanent fund shall be invested in separate differential rate and market rate investment classes. "Differential rate investments" are permitted in Sections 7-27-5.3 through 7-27-5.5, 7-27-5.13 through 7-27-5.17, 7-27-5.22, [and] 7-27-5.24, [through] 7-27-5.26 and 7-27-5.27 NMSA 1978 and are intended to stimulate the economy of New Mexico and to provide income to the severance tax permanent fund. "Market rate investments" are investments that are not differential rate investments and are intended to provide income to the severance tax permanent fund. All market rate investments and differential rate investments shall be invested in accordance with the Uniform Prudent Investor Act and shall be accounted for in accordance with generally accepted accounting principles."
SECTION 2. A new Section 7-27-5.27 NMSA 1978 is enacted to read:
"7-27-5.27. [NEW MATERIAL] INVESTMENT IN NEW MEXICO RENEWABLE ENERGY BUSINESSES, PROJECTS AND BONDS.--
A. The state investment officer shall invest no less than one percent of the market value of the severance tax permanent fund in one or more of the following renewable energy businesses, projects and bonds:
(1) a New Mexico renewable energy business;
(2) a New Mexico renewable energy project; provided that such investment shall not exceed fifty percent of the estimated cost of the project;
(3) bonds issued under the Renewable Energy Financing District Act;
(4) energy efficiency bonds issued under the Energy Efficiency and Renewable Energy Bonding Act;
(5) utility revenue bonds issued by a municipality or county for acquiring, extending, enlarging, bettering, repairing or otherwise improving a facility, the primary purpose of which is the generation, storage or transmission of renewable energy;
(6) renewable energy transmission bonds issued under the New Mexico Renewable Energy Transmission Authority Act; or
(7) a New Mexico renewable energy private equity fund.
B. An investment made pursuant to this section shall be made upon approval of the council and in a manner consistent with the Uniform Prudent Investor Act.
C. By June 30 of each year, the state investment officer shall advise the council of the ratio of the market value of investments made pursuant to this section to the market value of the severance tax permanent fund. The council shall use that ratio in determining what changes in investments may need to be made, if any, to meet the requirements of this section.
D. As used in this section:
(1) "energy efficient product" means a product, including a building, that uses less energy than the traditional version of the same product to perform the same task;
(2) "New Mexico renewable energy business" means a business entity that:
(a) has its principal place of business and a majority of its full-time employees in New Mexico and that, as its primary purpose, manufactures, distributes, sells or installs: 1) equipment used in the generation, storage or transmission of renewable energy; or 2) energy efficient products; or
(b) employs more than fifty employees at a manufacturing facility in New Mexico, the primary product of which is: 1) equipment used in the generation, storage or transmission of renewable energy; or 2) energy efficient products;
(3) "New Mexico renewable energy private equity fund" means a business entity organized and operating in the United States that:
(a) has as its primary business activity the investment of funds in return for equity in New Mexico renewable energy projects;
(b) holds out the prospects for capital appreciation from such investments; and
(c) accepts investments only from accredited investors as that term is defined in Section 2 of the federal Securities Act of 1933, as amended, and rules promulgated pursuant to that section;
(4) "New Mexico renewable energy project" means a facility located in New Mexico, the primary purpose of which is the generation, transmission or storage of renewable energy;
(5) "renewable energy" means energy that is derived from solar heat, solar light, wind, geothermal energy, hydroelectric power, landfill gas or biomass, either singly or in combination, and that is not derived from fossil or nuclear fuel; and
(6) "storage" means an energy storage technology that converts and stores energy for subsequent delivery to energy consumers."
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