SB0481

SENATE BILL 481

57th legislature - STATE OF NEW MEXICO - first session, 2025

INTRODUCED BY

Mimi Stewart

AN ACT

RELATING TO PUBLIC FINANCES; ENACTING THE STATE FAIRGROUNDS DISTRICT ACT; CREATING THE STATE FAIRGROUNDS DISTRICT OVER THE LAND OWNED BY THE STATE, COMMONLY REFERRED TO AS THE "STATE FAIRGROUNDS", AND CONTIGUOUS LAND THAT MAY BE SUBSEQUENTLY ACQUIRED; PROVIDING POWERS; CREATING THE STATE FAIRGROUNDS DISTRICT BOARD; AUTHORIZING THE ISSUANCE OF BONDS AND REFUNDING BONDS BY THE STATE FAIRGROUNDS DISTRICT; CREATING THE STATE FAIRGROUNDS DISTRICT FUND; PROVIDING A TAX EXEMPTION FROM BONDS AND INCOME FROM BONDS ISSUED PURSUANT TO THE STATE FAIRGROUNDS DISTRICT ACT; MAKING DISTRIBUTIONS OF THE NET RECEIPTS ATTRIBUTABLE TO THE GROSS RECEIPTS TAX AND GAMING TAX FROM BUSINESS LOCATIONS ON THE STATE FAIRGROUNDS; MAKING AN APPROPRIATION.

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

SECTION 1. A new section of Chapter 6 NMSA 1978 is enacted to read:

"[NEW MATERIAL] SHORT TITLE.--Sections 1 through 10 of this act may be cited as the "State Fairgrounds District Act"."

SECTION 2. A new section of Chapter 6 NMSA 1978 is enacted to read:

"[NEW MATERIAL] DEFINITIONS.--As used in the State Fairgrounds District Act:

A. "board" means the state fairgrounds district board;

B. "bond" means an obligation of the district issued pursuant to the State Fairgrounds District Act, whether designated as a bond, note, loan, warrant, debenture, lease-purchase agreement or other instrument evidencing an obligation of the district to make payments;

C. "district" means the state fairgrounds district that consists of all land owned by the state, commonly known as the "state fairgrounds", and lying within the exterior boundaries of the city of Albuquerque;

D. "project" means planning and design work for and development, construction, reconstruction, enlargement, improvement, installation, rehabilitation, remodeling and renovation of the state fairgrounds in the district, of a new site and facilities to host the state fair and of public schools in the close vicinity of the district; and

E. "property owner" means a person owning real property within the boundaries of the district."

SECTION 3. A new section of Chapter 6 NMSA 1978 is enacted to read:

"[NEW MATERIAL] STATE FAIRGROUNDS DISTRICT--CREATED--POWERS.--

A. The "state fairgrounds district" is created as a political subdivision of the state, separate and apart from a municipality or county. The district consists of all land owned by the state, commonly known as the "state fairgrounds", lying within the exterior boundaries of the city of Albuquerque, and land contiguous to the state fairgrounds that may be subsequently acquired and included in the boundaries of the district.

B. The district may:

(1) enter into contracts or expend money for any public purpose with respect to projects of the district;

(2) enter into agreements with a municipality, county or other local government entity in connection with real property located within the district;

(3) enter into an intergovernmental agreement in accordance with the Joint Powers Agreements Act for the planning, design, inspection, ownership, control, maintenance, operation or repair of public infrastructure or the provision of enhanced services by the municipality or county in which the district lies or for any other purpose authorized the State Fairgrounds District Act;

(4) sell, lease or otherwise dispose of district property if the sale, lease or conveyance is not a violation of the terms of any contract or bond covenant of the district;

(5) reimburse a municipality or county in which the district is located for providing services within the area of the district;

(6) operate, maintain and repair public infrastructure until dedicated to the governing body;

(7) employ staff, counsel, advisors and consultants;

(8) reimburse a municipality or county in which the district is located for staff and consultant services and support facilities supplied by the municipality;

(9) accept gifts or grants and incur and repay loans for a public purpose;

(10) enter into an agreement with a property owner concerning the advance of money by the owner for a public purpose or the granting of real property by the owner for a public purpose with respect to a project;

(11) pay the financial, legal and administrative costs of the district;

(12) enter into contracts, agreements and trust indentures to obtain credit enhancement or liquidity support for the district's bonds and process the issuance, registration, transfer and payment of the district's bonds and the disbursement and investment of proceeds of the bonds;

(13) borrow money and issue bonds to fund projects; and

(14) use public easements and rights of way in or across public property, roadways, highways, streets or other thoroughfares and other public easements and rights of way of the district, municipality or county.

C. Notwithstanding the provisions of the Procurement Code or local procurement requirements that may otherwise be applicable to the municipality in which the district is located, the board may enter into contracts to carry out any of the district's authorized powers, including the planning, design, engineering, financing, construction and acquisition of public improvements for the district, with a contractor, a property owner or other person or entity, on such terms and with such persons as the board determines to be appropriate."

SECTION 4. A new section of Chapter 6 NMSA 1978 is enacted to read:

"[NEW MATERIAL] STATE FAIRGROUNDS DISTRICT BOARD.--The district shall be governed by a five-member board composed of the governor, the lieutenant governor, a member appointed by the state senator representing the senate district inclusive of the district, the Bernalillo county commissioner representing the commission district inclusive of the district and the mayor of the city of Albuquerque for the term of the district. The board shall separately account for all revenues and indebtedness based on gross receipts tax and gaming tax distributed to the state fairgrounds district fund. The board shall individually account for all gross receipts tax and gaming tax distributed to the state fairgrounds district fund. The secretary of finance and administration or the secretary's designee shall serve as clerk and treasurer of the district."

SECTION 5. A new section of Chapter 6 NMSA 1978 is enacted to read:

"[NEW MATERIAL] AUTHORIZATION OF ISSUANCE OF BONDS.--

A. The district may issue revenue bonds not to exceed one billion dollars ($1,000,000,000) in net proceeds for projects. The district shall pledge irrevocably all of the revenue received by the district from the gross receipts tax distribution and the gaming tax distribution pursuant to Sections 11 and 12 of this 2025 act to the payment of the principal and interest of the bonds.

B. Revenue bonds or refunding bonds or loans may be

authorized only by resolution of the board, which shall be

approved by a majority of the members of the board. Prior to the board issuing bonds, the New Mexico finance authority, state board of finance and state bond counsel shall approve the proposed issuance of the bonds and determine that the proceeds of the bonds will be used for a project, in accordance with the State Fairgrounds District Act.

C. Revenue bonds or refunding bonds issued pursuant

to the State Fairgrounds District Act and other loans to the district are:

(1) not general obligations of the state or

any other agency of the state; and

(2) payable only from properly pledged

revenues and each bond or loan shall state that it is payable

solely from the properly pledged revenues and that the

bondholders or lenders may not look to any other fund for the

payment of the principal and interest of the bond or the loan.

D. Bonds issued pursuant to the State Fairgrounds District Act:

(1) may have principal value, interest or any part thereof payable at intervals or at maturity as may be determined by the board;

(2) may be subject to a prior redemption at the district's option at a time and upon terms and conditions, with or without the payment of a premium, as determined by the board;

(3) may mature at any time not exceeding twenty-five years after the date of issuance;

(4) may be serial in form and maturity, may consist of one bond payable at one time or in installments or may be in another form determined by the board;

(5) shall be sold for cash at, above or below par and at a price that results in a net effective interest rate that does not exceed the maximum permitted by the Public Securities Act and the Public Securities Short-Term Interest Rate Act; and

(6) may be sold at public or negotiated sale."

SECTION 6. A new section of Chapter 6 NMSA 1978 is enacted to read:

"[NEW MATERIAL] REFUNDING BONDS.--

A. After issuing bonds in accordance with the State Fairgrounds District Act, the board may issue refunding bonds for the purpose of refinancing, paying and discharging all or any part of outstanding bonds for the:

(1) acceleration, deceleration or other modification of the payment of the outstanding bonds, including, without limitation, any capitalization of any interest on the outstanding bonds in arrears or about to become due for any period not exceeding two years from the date of the refunding bonds;

(2) purpose of reducing interest costs or effecting other economies; or

(3) purpose of modifying or eliminating restrictive contractual limitations:

(a) pertaining to the issuance of additional bonds; or

(b) concerning the outstanding bonds or facilities relating to the outstanding bonds.

B. The board shall pledge irrevocably for the payment of principal, interest and premium, if any, on refunding bonds the revenues received from distributions of the gross receipts tax and gaming tax pursuant to Sections 11 and 12 of this 2025 act, which may be pledged to an original issue of bonds, and the terms of refunding bonds shall expire not more than twenty-five years after the date of the original issue of bonds.

C. Refunding bonds may be issued separately or in combination in one series or more.

D. Refunding bonds may be authorized only by resolution of the board. Bonds that are refunded shall be paid at maturity or on any permitted prior redemption date in the amounts, at the time and places and, if called prior to maturity, in accordance with any applicable notice provisions, all as provided in the proceedings authorizing the issuance of the refunded bonds or otherwise appertaining to them, except for any such bond that is voluntarily surrendered for exchange or payment by the holder or owner.

E. The principal amount of the refunding bonds may exceed the principal amount of the refunded bonds and may also be less than or the same as the principal amount of the bonds being refunded if provision is duly and sufficiently made for the payment of the refunded bonds.

F. The proceeds of refunding bonds, including accrued interest and premiums appertaining to the sale of refunding bonds, shall be immediately applied to the retirement of the bonds being refunded or placed in escrow in a commercial bank or trust company that possesses and exercises trust powers and that is a member of the federal deposit insurance corporation. The proceeds shall be applied to the principal of, interest on and any prior redemption premium due in connection with the bonds being refunded; provided that the refunding bond proceeds, including premiums and accrued interest appertaining to a sale of refunding bonds, may be applied to the establishment and maintenance of a reserve fund and to the payment of expenses incidental to the refunding and the issuance of the refunding bonds, the principal of those bonds and the interest of those bonds or both principal and interest as the board determines. This section does not require the establishment of an escrow if the refunded bonds and the amounts necessary to retire the refunded bonds within that time are deposited with the paying agent for the refunded bonds. Any such escrow shall not necessarily be limited to proceeds of refunding bonds but may include other money available for its purpose. Proceeds in escrow pending such use may be invested or reinvested in bills, certificates of indebtedness, notes or bonds that are direct obligations of, or the principal and interest of which obligations are unconditionally guaranteed by, the United States or in certificates of deposit of banks that are members of the federal deposit insurance corporation; provided that the par value of the certificates of deposit is collateralized by a pledge of obligations or by a pledge of payment that is unconditionally guaranteed by the United States; and further provided that the par value of those obligations is at least seventy-five percent of the par value of the certificates of deposit. Such proceeds and investments in escrow, together with any interest or other income to be derived from any such investment, shall be in an amount at all times sufficient as to principal, interest, any prior redemption premium due and any charges of the escrow agent payable from the escrow to pay the bonds being refunded as they become due at their respective maturities or at any designated prior redemption date or dates in connection with which the prior redemption option shall be exercised. A purchaser of a refunding bond issued is not responsible for the application of the proceeds by the district or any of its officers, agents or employees.

G. Refunding bonds may bear additional terms and provisions as determined by the board subject to the limitations in this section relating to original bond issues.

H. District refunding bonds:

(1) may have principal value, interest or any part thereof payable at intervals or at maturity, as determined by the board;

(2) may be subject to prior redemption at the board's option at a time or times and upon terms and conditions with or without payment of premium or premiums, as determined by the board;

(3) may be serial in form and maturity or may consist of a single bond payable in one or more installments or may be in another form, as determined by the board; and

(4) shall be exchanged for the bonds and any matured unpaid interest being refunded at not less than par or sold at public or negotiated sale at, above or below par and at a price that results in a net effective interest rate that does not exceed the maximum permitted by the Public Securities Act.

I. At a regular or special meeting, the board may adopt a resolution by majority vote to authorize the issuance of the refunding bonds."

SECTION 7. A new section of Chapter 6 NMSA 1978 is enacted to read:

"[NEW MATERIAL] TAX MODIFICATIONS--BOND TERMS.--Nothing herein shall prohibit the legislature from increasing or decreasing the state gross receipts tax. The terms and conditions of any bond issued by the district pursuant to the State Fairgrounds Act shall explicitly provide that the repayment of such bonds, including interest and principal, is subject to modifications based on the increase or decrease in taxes imposed by the state."

SECTION 8. A new section of Chapter 6 NMSA 1978 is enacted to read:

"[NEW MATERIAL] STATE FAIRGROUNDS DISTRICT FUND.--The "state fairgrounds district fund" is created in the state treasury. The fund consists of distributions, appropriations, gifts, grants, donations and income from investment of the fund. The board shall administer the fund. Money in the fund is appropriated to the board for the issuance and payment of bonds pursuant to the State Fairgrounds District Act. Expenditures from the fund shall be by warrant of the secretary of finance and administration pursuant to vouchers signed by the secretary of finance and administration or the secretary's authorized representative. Any unexpended or unencumbered balance remaining at the end of fiscal year 2051 shall revert to the general fund."

SECTION 9. A new section of Chapter 6 NMSA 1978 is enacted to read:

"[NEW MATERIAL] EXEMPTION FROM TAXATION.--The bonds authorized by the State Fairgrounds District Act and the income from the bonds or any other instrument executed as security for the bonds shall be exempt from all taxation by the state or any political subdivision of the state."

SECTION 10. A new section of Chapter 6 NMSA 1978 is enacted to read:

"[NEW MATERIAL] REPORT REQUIRED.--By September 1 of each year, beginning in 2025 and continuing until 2052, the board shall report to the state board of finance and the legislative finance committee on the implementation of the State Fairgrounds District Act and expenditures to date, bonds issued, debt service reserve funds held, progress made toward retiring the bonds, estimated capital investment in the district, the estimated total net new jobs and new full-time economic base jobs created in the district and the total revenues distributed to the district in each previous fiscal year."

SECTION 11. A new section of the Tax Administration Act is enacted to read:

"[NEW MATERIAL] DISTRIBUTION--STATE FAIRGROUNDS DISTRICT.--A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the state fairgrounds district fund in an amount, subject to any increase or decrease made pursuant to Section 7-1-6.15 NMSA 1978, equal to the net receipts attributable to the gross receipts tax from business locations on land owned by the state, commonly known as the "state fairgrounds", and lying within the exterior boundaries of the city of Albuquerque. This distribution shall be made until the bonds issued pursuant to the State Fairgrounds District Act are fully discharged or otherwise provided for in full."

SECTION 12. A new section of the Gaming Control Act is enacted to read:

"[NEW MATERIAL] DISTRIBUTION--STATE FAIRGROUNDS DISTRICT.--A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the state fairgrounds district fund in an amount, subject to any increase or decrease made pursuant to Section 7-1-6.15 NMSA 1978, equal to the net receipts attributable to the gaming tax from business locations on land owned by the state, commonly known as the "state fairgrounds", and lying within the exterior boundaries of the city of Albuquerque. This distribution shall be made until the bonds issued pursuant to the State Fairgrounds District Act are fully discharged or otherwise provided for in full."

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