FORTY-THIRD LEGISLATURE            HB 225/a
                        SECOND SESSION, 1998
  
  
                                                February 14, 1998
  
  Mr. President:
  
      Your FINANCE COMMITTEE, to whom has been referred
  
                           HOUSE BILL 225
  
  has had it under consideration and reports same with
  recommendation that it DO PASS, amended as follows:
  
      1.  On page 1, line 12, after "ACT" insert "TO RESTRICT THE
  POWER OF THE NEW MEXICO FINANCE AUTHORITY TO MAKE GRANTS AND".
  
      2.  On page 1, between lines 15 and 16, insert the following
  new sections:  
  
      "Section 1.  Section 6-21-2 NMSA 1978 (being Laws 1992,
  Chapter 61, Section 2, as amended) is amended to read:
  
      "6-21-2.  LEGISLATIVE FINDINGS--DECLARATION OF PURPOSE.--
  
          A.  The legislature finds that:
  
               (1)  there are necessary state and local capital
  improvement and infrastructure needs that cannot be met with
  existing capital financing methods and funding sources;
  
               (2)  there is no coordinating entity or process for
  accomplishing long-term state and local capital planning, needs
  assessment or inventory of needs; setting priorities; and making
  more effective use of existing capital financing methods and
  funding sources;
  
               (3)  the uncertain nature of revenues available from
  the proceeds of severance tax bonds and other state and local
  revenues have frustrated state and local government efforts to
  finance needed state and local capital projects; and
  
               (4)  in order to meet public capital and
  infrastructure needs, a central state mechanism to coordinate the
  planning and financing of public projects is necessary.
  
          B.  It is the purpose of the New Mexico Finance Authority
  Act to create a governmental instrumentality to coordinate the
  planning and financing of state and local public projects, to
  provide for long-term planning and assessment of state and local
  capital needs and to improve cooperation among the executive and
  legislative branches of state government and local governments in
  financing public projects.
  
  <u>       C.  It is the further purpose of the New Mexico Finance
  Authority Act to provide financing for public projects in a manner
  that will not impair the capacity of the public project revolving
  fund to provide future financing to qualified entities for public
  projects.  Funding shall not be provided from the public project
  revolving fund unless revenues in an amount sufficient to avoid
  any negative impact on the financing capacity of the public
  project revolving fund are contemporaneously pledged or dedicated
  for deposit to the public project revolving fund.  Pursuant to
  Section 6-21-6.1 NMSA 1978, the authority may provide funding from
  the public project revolving fund for the purposes of the
  Wastewater Facility Construction Loan Act, the Rural
  Infrastructure Act, the Solid Waste Act or the Drinking Water
  State Revolving Loan Fund Act.</u>"
  
      Section 2.  Section 6-21-5 NMSA 1978 (being Laws 1992, Chapter
  61, Section 5) is amended to read:
  
      "6-21-5.  POWERS OF THE AUTHORITY.--The authority is granted
  all powers necessary and appropriate to carry out and effectuate
  its public and corporate purposes, including but not limited to
  the following powers:
  
          A.  to sue or be sued;
  
          B.  to adopt and alter an official seal;
  
          C.  to make and alter bylaws for its organization and
  internal management and to adopt subject to the review and
  approval of the New Mexico finance authority oversight committee
  such regulations as are necessary and appropriate to implement the
  provisions of the New Mexico Finance Authority Act;
  
          D.  to appoint officers, agents and employees, prescribe
  their duties and qualifications and fix their compensation;
  
          E.  to make, enter into and enforce all contracts,
  agreements and other instruments necessary, convenient or
  desirable in the exercise of the authority's powers and functions
  and for the purposes of the New Mexico Finance Authority Act;
  
          F.  to acquire, construct, hold, improve, mortgage, sell,
  lease, convey or dispose of real and personal property for its
  public purposes;
  
          G.  to make loans and purchase securities and contract to
  make loans and purchase securities;
  
          <s>[H.  to make grants to qualified entities to finance
  public projects;
  
          I.]</s> <u>H.</u>  to procure insurance to secure payment on any
  loan, lease or purchase payments owed to the authority by a
  qualified entity in such amounts and from such insurers, including
  the federal government, as it may deem necessary or desirable and
  to pay any premiums for such insurance;
  
          <s>[J.]</s> <u>I.</u>  to fix, revise from time to time, charge and
  collect fees and other charges in connection with the making of
  loans and any other services rendered by the authority;
  
          <s>[K.]</s> <u>J.</u>  to accept, administer, hold and use all funds
  made available to the authority from any sources;
  
          <s>[L.]</s> <u>K.</u>  to borrow money and to issue bonds and
  provide for the rights of the holders of the bonds;
  
          <s>[M.]</s> <u>L.</u>  to establish and maintain reserve and sinking
  fund accounts to insure against and have funds available for
  maintenance of other debt service accounts;
  
          <s>[N.]</s> <u>M.</u>  to invest and reinvest its funds and to take
  and hold property as security for the investment of such funds as
  provided in the New Mexico Finance Authority Act;
  
          <s>[O.]</s> <u>N.</u>  to employ attorneys, accountants,
  underwriters, financial advisers, trustees, paying agents,
  architects, engineers, contractors and such other advisors,
  consultants and agents as may be necessary and to fix and pay
  their compensation;
  
          <s>[P.]</s> <u>O.</u>  to apply for and accept gifts or grants of
  property, funds, services or aid in any form from the United
  States, any unit of government or any person and to comply,
  subject to the provisions of the New Mexico Finance Authority Act,
  with the terms and conditions of the gifts or grants;
  
          <s>[Q.]</s> <u>P.</u>  to maintain an office at any place in the
  state it may determine;
  
          <s>[R.]</s> <u>Q.</u>  subject to any agreement with bondholders,
  to:
  
               (1)  renegotiate any loan or agreement;
  
               (2)  consent to any modification of the terms of any
  loan or agreement; and
  
               (3)  purchase bonds, which may upon purchase be
  canceled; and
  
          <s>[S.]</s> <u>R.</u>  to do any and all things necessary or
  convenient to carry out its purposes and exercise the powers given
  and granted in the New Mexico Finance Authority Act."".
  
      3.  Renumber the succeeding section accordingly.
  
      4.  On page 2, line 24, strike "or grants".
  
      5.  On page 6, between lines 2 and 3, insert the following new 
  sections:
  
      "Section 4.  Section 6-21-8 NMSA 1978 (being Laws 1992,
  Chapter 61, Section 8) is amended to read:
  
      "6-21-8.  PUBLIC PROJECT FINANCE PROGRAM--LOANS--PURCHASE OR
  SALE OF SECURITIES.--To implement a program to assist qualified
  entities in financing public projects, the authority, subject to
  specific authorization by law for projects financed with money in
  the public projects revolving fund, may:
  
          A.  make loans to qualified entities that establish one or
  more dedicated sources of revenue to repay the loan from the
  authority;
  
          B.  make, enter into and enforce all contracts necessary,
  convenient or desirable for the purposes of the authority or
  pertaining to:
  
               (1)  a loan to a qualified entity;
  
               <s>[(2)  a grant to a qualified entity;
  
               (3)]</s> <u>(2)</u>  a purchase or sale of securities
  individually or on a pooled basis; or
  
               <s>[(4)]</s> <u>(3)</u>  the performance of its duties and
  execution of any of its powers under the New Mexico Finance
  Authority Act;
  
          C.  purchase or hold securities at prices and in a manner
  the authority considers advisable, giving due consideration to the
  financial capability of the qualified entity, and sell securities
  acquired or held by it at prices without relation to cost and in a
  manner the authority considers advisable;
  
          D.  prescribe the form of application or procedure
  required of a qualified entity for a loan or purchase of its
  securities, fix the terms and conditions of the loan or purchase
  and enter into agreements with qualified entities with respect to
  loans or purchases;
  
          E.  charge for its costs and services in review or
  consideration of a proposed loan to a qualified entity or purchase
  by the authority of securities, whether or not the loan is made or
  the securities purchased;
  
          F.  fix and establish terms and provisions with respect
  to:
  
               (1)  a purchase of securities by the authority,
  including date and maturities of the securities;
  
               (2)  redemption or payment before maturity; and
  
               (3)  any other matters that in connection with the
  purchase are necessary, desirable or advisable in the judgment of
  the authority;
  
          G.  to the extent permitted under its contracts with the
  holders of bonds of the authority, consent to modification of the
  rate of interest, time and payment of installment of principal or
  interest, security or any other term of a bond, contract or
  agreement of any kind to which the authority is a party;
  
          H.  in connection with the purchase of any securities,
  consider the ability of the qualified entity to secure financing
  from other sources and the costs of that financing and the
  particular public project or purpose to be financed or refinanced
  with the proceeds of the securities to be purchased by the
  authority;
  
          I.  acquire and hold title to or leasehold interest in 
  real and personal property and to sell, convey or lease that
  property for the purpose of satisfying a default or enforcing the
  provisions of a loan agreement; and
  
          J.  in the event of default by a qualified entity, enforce
  its rights by suit or mandamus or may use all other available
  remedies under state law."
  
      Section 5.  Section 6-21-11 NMSA 1978 (being Laws 1992,
  Chapter 61, Section 11) is amended to read:
  
      "6-21-11.  BONDS OF THE AUTHORITY--USE--SECURITY.--
  
          A.  The authority may issue and sell bonds in principal
  amounts it considers necessary to provide sufficient funds for any
  purpose of the New Mexico Finance Authority Act, including:
  
               (1)  purchase of securities;
  
               (2)  <s>[make]</s> <u>making</u> loans through the purchase of
  securities;
  
               <s>[(3)  make grants for public projects;
  
               (4)]</s> <u>(3)</u>  the construction of public projects;
  
               <s>[(5)]</s> <u>(4)</u>  the payment, funding or refunding of
  the 
  principal of or interest or redemption premiums on bonds issued by
  the authority, whether the bonds or interest to be paid, funded or
  refunded have or have not become due;
  
               <s>[(6)]</s> <u>(5)</u>  the establishment or increase of
  reserves or sinking funds to secure or to pay principal, premium,
  if any, or interest on bonds; and
  
               <s>[(7)]</s> <u>(6)</u>  all other costs or expenses of the
  authority incident to and necessary or convenient to carry out its
  corporate purposes and powers.
  
          B.  Except as otherwise provided in the New Mexico Finance
  Authority Act, all bonds or other obligations issued by the
  authority shall be obligations of the authority payable solely
  from the revenues, income, fees, charges or funds of the authority
  that may, pursuant to the provisions of the New Mexico Finance
  Authority Act, be pledged to the payment of such obligations, and
  the bonds or other obligations shall not create an obligation,
  debt or liability of the state.  No breach of any pledge,
  obligation or agreement of the authority shall impose a pecuniary
  liability or a charge upon the general credit or taxing power of
  the state or any political subdivision of the state.
  
          C.  As security for the payment of the principal, interest
  or premium, if any, on bonds issued by the authority, the
  authority is authorized to pledge, transfer and assign:
  
               (1)  any obligation of a qualified entity that is
  payable to the authority;
  
               (2)  the security for the qualified entity's
  obligations;
  
               (3)  money in the public project revolving fund or
  any subaccount of that fund subject to the provisions of
  Subsection C of Section <s>[6 of the New Mexico Finance Authority
  Act]</s> <u>6-21-6 NMSA 1978</u>;
  
               (4)  any grant, subsidy or contribution from the
  United States or any of its agencies or instrumentalities; or
  
               (5)  any income, revenues, funds or other money of
  the authority from any other source authorized for such pledge,
  transfer or assignment other than from the public projects
  revolving fund under the New Mexico Finance Authority Act."
  
      Section 6.  Section 6-21-23 NMSA 1978 (being Laws 1992,
  Chapter 61, Section 23, as amended) is amended to read:
  
      "6-21-23.  PROHIBITED ACTIONS.--The authority shall not:
  
          A.  lend money <s>[or make a grant]</s> other than to a
  qualified entity;
  
          B.  purchase securities other than from a qualified entity
  or other than for investment as provided in the New Mexico Finance
  Authority Act;
  
          C.  lease a public project to any entity other than a
  qualified entity;
  
          D.  deal in securities within the meaning of or subject to
  any securities law, securities exchange law or securities dealers
  law of the United States or of the state or of any other state or
  jurisdiction, domestic or foreign, except as authorized in the New
  Mexico Finance Authority Act;
  
          E.  issue bills of credit or accept deposits of money for
  time on demand deposit or administer trusts or engage in any form
  or manner, or in the conduct of, any private or commercial banking
  business, or act as a savings bank or savings and loan association
  or any other kind of financial institution except as authorized in
  the New Mexico Finance Authority Act;
  
          F.  engage in any form of private or commercial banking
  business except as authorized in the New Mexico Finance Authority
  Act; or
  
          G.  lend money <u>or</u> issue bonds, including public-private
  partnership project bonds, <s>[or make a grant]</s> for the promotion
  of gaming or a gaming enterprise or for development of
  infrastructure for a gaming facility."".
          
  
  
  
                               Respectfully submitted,
  
  
  
                               __________________________________
                               Ben. Altamirano, Chairman 
  
  
  
  
  
  
  
  
  
  Adopted_______________________   Not Adopted_______________________
            (Chief Clerk)                          (Chief Clerk)
  
  
                    Date ________________________
  
  
  The roll call vote was<u> 8 </u> For<u> 0 </u> Against
          Yes:    8
          No:     None
  Excused: Campos, Carraro, Lyons
          Absent: None
  
  
  H0225FC1                                              .123311.1