0001|                            HOUSE BILL 195
    |
0002|     43RD LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION, 1998
    |
0003|                            INTRODUCED BY
    |
0004|                              BEN LUJAN
    |
0005|     
    |
0006|                                   
    |
0007|     
    |
0008|                                   
    |
0009|     
    |
0010|                                AN ACT
    |
0011|     RELATING TO TAXATION; AUTHORIZING IMPOSITION OF A COUNTY
    |
0012|     PUBLIC SCHOOL GROSS RECEIPTS TAX TO PROVIDE COST-OF-LIVING
    |
0013|     SUPPLEMENTS FOR PUBLIC SCHOOL EMPLOYEES IN SCHOOL DISTRICTS IN
    |
0014|     AN AREA IMPACTED BY A HIGH COST OF LIVING; PROVIDING FOR
    |
0015|     DISTRIBUTION OF REVENUES; PROVIDING FOR A REFERENDUM.
    |
0016|     
    |
0017|     BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
    |
0018|          Section 1.  A new section of the County Local Option
    |
0019|     Gross Receipts Taxes Act is enacted to read:
    |
0020|          "[<u>NEW MATERIAL</u>]  COUNTY PUBLIC SCHOOL GROSS RECEIPTS 
    |
0021|     TAX--AUTHORITY TO IMPOSE RATE--DISTRIBUTION AND USE OF FUNDS--
    |
0022|     REFERENDUM.--
    |
0023|               A.  Upon the request of a majority of the members
    |
0024|     of the school board of an impacted school district in which a
    |
0025|     majority of the students reside in the county, the majority of
    |
<center>- 1 -</center>

0001|     the members of the governing body of the county shall enact an
    |
0002|     ordinance imposing an excise tax at a rate not to exceed one-
    |
0003|     eighth of one percent of the gross receipts of any person
    |
0004|     engaging in business in the county for the privilege of
    |
0005|     engaging in business in the county.
    |
0006|               B.  This tax may be referred to as the "county
    |
0007|     public school gross receipts tax".
    |
0008|               C.  The tax authorized in Subsection A of this
    |
0009|     section shall be imposed at a rate of:
    |
0010|                   (1)  one-eighth of one percent of the gross
    |
0011|     receipts of any person engaging in business in the county if
    |
0012|     the impacted school district requesting imposition of the tax
    |
0013|     is located in a municipality that exceeds the cost-of-living
    |
0014|     index by twenty percent or more; provided, upon notification
    |
0015|     by the district that the rate must be reduced to one-sixteenth
    |
0016|     of one percent to comply with the requirements in Subsections
    |
0017|     E through G of this section, the county shall enact an
    |
0018|     ordinance imposing the tax at a rate of one-sixteenth of one
    |
0019|     percent of the gross receipts of any person engaging in
    |
0020|     business in the county; or
    |
0021|                   (2)  one-sixteenth of one percent of the gross
    |
0022|     receipts of any person engaging in business in the county if
    |
0023|     the impacted school district requesting imposition of the tax
    |
0024|     is located in a municipality that exceeds the cost-of-living
    |
0025|     index by less than twenty percent.
    |
<center>- 2 -</center>

0001|              D.  A county, at the time of enacting an ordinance 
    |
0002|     imposing a county public school gross receipts tax, shall
    |
0003|     dedicate the entire amount of revenue produced by the tax for
    |
0004|     distribution to a specific impacted school district in the
    |
0005|     county to be used solely to provide cost-of-living supplements
    |
0006|     to all employees of the district.  The county shall distribute
    |
0007|     the net receipts from the tax monthly to the impacted school
    |
0008|     district for whom the revenue is dedicated.
    |
0009|              E.  No impacted school district may receive from
    |
0010|     the county public school gross receipts tax net receipts that
    |
0011|     for any fiscal year exceed ten percent of the amount
    |
0012|     distributed to the district through the state equalization
    |
0013|     guarantee distribution for that fiscal year.  The district,
    |
0014|     upon a finding that it anticipates such an excess amount and
    |
0015|     subject to the approval of the local school board and the
    |
0016|     state department of public education, shall notify the board
    |
0017|     of county commissioners to reduce the rate, if the rate of the
    |
0018|     county public school gross receipts tax can be reduced.  If
    |
0019|     not, the district shall reduce the amount budgeted for cost-
    |
0020|     of-living supplements to an amount that does not exceed ten
    |
0021|     percent of the amount distributed to the district through the
    |
0022|     state equalization guarantee distribution for that fiscal year
    |
0023|     and shall provide for distribution of the excess amount to a
    |
0024|     special school district capital fund established by the
    |
0025|     district to fund capital and technology needs of the district. 
    |
<center>- 3 -</center>

0001|              F.  If an impacted school district receiving county
    |
0002|     public school gross receipts tax revenues ceases to meet the
    |
0003|     qualifications for an impacted school district, the district
    |
0004|     shall phase out the employee cost-of-living supplements over a
    |
0005|     three-year period.  To phase out funding, the district shall
    |
0006|     continue for one fiscal year to budget one hundred percent of
    |
0007|     the receipts for cost-of-living supplements and then shall
    |
0008|     reduce the budget for those supplements to two-thirds of the
    |
0009|     full amount for the second fiscal year and one-third of the
    |
0010|     full amount for the third year.  Any revenues distributed from
    |
0011|     the county public school gross receipts tax in excess of the
    |
0012|     budgeted amounts shall be deposited in the special school
    |
0013|     district capital fund for expenditure for district capital and
    |
0014|     technology needs.    
    |
0015|              G.  Upon a finding that the school district ceases
    |
0016|     to qualify as an impacted school district, the district shall
    |
0017|     notify the board of county commissioners of that fact ninety
    |
0018|     days prior to the next succeeding July 1.  The board of county
    |
0019|     commissioners shall enact an ordinance reducing the tax for
    |
0020|     any succeeding fiscal year, if necessary and possible pursuant
    |
0021|     to this section, and shall repeal the tax on the July 1 four
    |
0022|     years following the notification. 
    |
0023|              H.  A school district receiving county public
    |
0024|     school gross receipts tax revenues shall determine prior to
    |
0025|     the beginning of the school year, based on estimated revenues,
    |
<center>- 4 -</center>

0001|     the amount of the periodic cost-of-living supplement that can
    |
0002|     be paid to each employee for the school year.  The supplement
    |
0003|     shall be distributed to employees in nine or twelve equal
    |
0004|     payments a year, as determined by each school district;
    |
0005|     provided that the final installment each year may be adjusted
    |
0006|     as necessary to meet available revenue.  Amounts distributed
    |
0007|     shall be supplemental to and not a part of the employees'
    |
0008|     salaries.
    |
0009|              I.  An ordinance enacting the county public school
    |
0010|     gross receipts tax pursuant to Subsection A of this section
    |
0011|     shall go into effect on July 1 or January 1 in accordance with
    |
0012|     the provisions of the County Local Option Gross Receipts Taxes
    |
0013|     Act, but an election may be called in the county on the
    |
0014|     question of approving or disapproving that ordinance as
    |
0015|     follows:
    |
0016|                   (1)  an election shall be called when:
    |
0017|                        (a)  in a county having a referendum
    |
0018|     provision in its charter, a petition requesting such an
    |
0019|     election is filed pursuant to the requirements of that
    |
0020|     provision in the charter and signed by the number of
    |
0021|     registered voters in the county equal to the number of
    |
0022|     registered voters required in its charter to seek a
    |
0023|     referendum; and
    |
0024|                        (b)  in all other counties, a petition
    |
0025|     requesting such an election is filed with the county clerk
    |
<center>- 5 -</center>

0001|     within thirty days of enactment of the ordinance by the
    |
0002|     governing body and the petition has been signed by a number of
    |
0003|     registered voters in the county equal to at least five percent
    |
0004|     of the number of voters in the county who were registered to
    |
0005|     vote in the most recent general election;
    |
0006|                   (2)  the signatures on the petition requesting
    |
0007|     an election shall be verified by the county clerk.  If the
    |
0008|     petition is verified by the county clerk as containing the
    |
0009|     required number of signatures of registered voters, the
    |
0010|     governing body shall adopt a resolution calling an election on
    |
0011|     the question of approving or disapproving the ordinance.  The
    |
0012|     election shall be held within sixty days after the date the
    |
0013|     petition is verified by the county clerk, or it may be held in
    |
0014|     conjunction with a general election if that election occurs
    |
0015|     within sixty days after the date of the verification.  The
    |
0016|     election shall be called, held, conducted and canvassed in
    |
0017|     substantially the same manner as provided by law for general
    |
0018|     elections; and
    |
0019|                   (3)  if a majority of the registered voters
    |
0020|     voting on the question approves the ordinance imposing the
    |
0021|     county public school gross receipts tax, the ordinance shall
    |
0022|     go into effect on July 1 or January 1 in accordance with the
    |
0023|     provisions of the County Local Option Gross Receipts Taxes
    |
0024|     Act.  If at such an election a majority of the registered
    |
0025|     voters voting on the question disapproves the ordinance, the
    |
<center>- 6 -</center>

0001|     ordinance imposing the county public school gross receipts tax
    |
0002|     shall be deemed repealed and the question of imposing the tax
    |
0003|     shall not be considered again by the governing body for a
    |
0004|     period of one year from the date of the election.
    |
0005|              J.  As used in this section:
    |
0006|                   (1)  "cost-of-living index" means the American
    |
0007|     chamber of commerce researchers association national median
    |
0008|     composite cost-of-living index; and
    |
0009|                   (2)  "impacted school district" means a school
    |
0010|     district that is located in a municipality that is deemed to
    |
0011|     be a high cost-of-living area if: 
    |
0012|                        (a)  the municipality's cost of living
    |
0013|     equals or exceeds the cost-of-living index by ten percent or
    |
0014|     more; or
    |
0015|                        (b)  the municipality is designated by
    |
0016|     the federal internal revenue service as a high-cost area that
    |
0017|     qualifies for a per diem travel allowance greater than the
    |
0018|     standard allowance pursuant to the Internal Revenue Code of
    |
0019|     1986, as amended."
    |
0020|                                  
    |