44th legislature - STATE OF NEW MEXICO - second session, 2000

RELATING TO PUBLIC FINANCE; ENACTING THE TOBACCO SETTLEMENT BONDING ACT; AMENDING A SECTION OF THE NMSA 1978.

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

Section 1. Section 6-4-11 NMSA 1978 (being Laws 1999, Chapter 207, Section 3) is amended to read:

"6-4-11. TOBACCO SETTLEMENT DISTRIBUTIONS TO STATE-- TRANSFER TO TOBACCO SETTLEMENT PERMANENT FUND.--[The state treasurer shall deposit in the tobacco settlement permanent fund] All amounts distributed to the state pursuant to the master settlement agreement entered into between tobacco product manufacturers and various states, including New Mexico, and executed November 23, 1998 or from a qualified escrow fund authorized by a qualifying state statute enacted pursuant to the master settlement agreement before issuance of tobacco settlement bonds pursuant to the Tobacco Settlement Bonding Act shall be deposited by the state treasurer in the tobacco settlement permanent fund and after issuance of tobacco settlement bonds, as certified by the New Mexico finance authority, shall be deposited in the tobacco settlement bonding fund."

Section 2. [NEW MATERIAL] SHORT TITLE.--Sections 2 through 13 of this act may be cited as the "Tobacco Settlement Bonding Act".

Section 3. [NEW MATERIAL] TOBACCO SETTLEMENT BONDS--AUTHORITY FOR ISSUANCE.--The legislature may by law direct the New Mexico finance authority to issue and sell tobacco settlement bonds in accordance with the provisions of the Tobacco Settlement Bonding Act.

Section 4. [NEW MATERIAL] TOBACCO SETTLEMENT BONDING FUND CREATED.--There is created in the New Mexico finance authority the "tobacco settlement bonding fund" into which shall be deposited, after issuance of tobacco settlement bonds and in accordance with the Tobacco Settlement Bonding Act, the tobacco settlement distributions and into which shall be deposited such other money as the legislature may from time to time determine.

Section 5. [NEW MATERIAL] TOBACCO SETTLEMENT BONDING FUND PLEDGE.--The money in the tobacco settlement bonding fund is pledged for the payment of principal and interest on all tobacco settlement bonds issued after the enactment of the Tobacco Settlement Bonding Act.

Section 6. [NEW MATERIAL] TRANSFER OF MONEY TO TOBACCO SETTLEMENT PERMANENT FUND.--Any money in the tobacco settlement bonding fund not needed to pay principal, interest and any other expenses or obligations related to the tobacco settlement bonds on the next two ensuing semiannual payment dates shall be transferred to the tobacco settlement permanent fund.

Section 7. [NEW MATERIAL] BONDS TO BE KNOWN AS TOBACCO SETTLEMENT BONDS.--All bonds hereafter issued wherein the money in the tobacco bonding fund is pledged for their retirement shall be known as "New Mexico finance authority tobacco settlement bonds". Tobacco settlement bonds shall be special limited obligations of the authority payable solely from the tobacco settlement bonding fund and the bonds shall not create an obligation, debt or liability of the state or any political subdivision of the state. No breach of any pledge, obligation or agreement of the authority relating to the bonds shall impose a pecuniary liability or charge upon the general credit or taxing power of any political subdivision of the state.

Section 8. [NEW MATERIAL] NEW MEXICO FINANCE AUTHORITY SHALL ISSUE BONDS.--The New Mexico finance authority is authorized to issue and sell tobacco settlement bonds in accordance with the provisions of the Tobacco Settlement Bonding Act and the New Mexico Finance Authority Act, and no other agency of the state is authorized to issue or sell tobacco settlement bonds.

Section 9. [NEW MATERIAL] WHEN TOBACCO SETTLEMENT BONDS TO BE ISSUED.--

A. The New Mexico finance authority shall issue and sell all tobacco settlement bonds when authorized to do so by any law that sets out the amount of the issue and the recipient of the money.

B. The New Mexico finance authority shall issue and sell all tobacco settlement bonds only when so instructed by resolution of the governing body or executive head of the recipient of the bond money.

C. The provisions of this section shall not be modified by the terms of any tobacco settlement bonds hereafter issued.

Section 10. [NEW MATERIAL] LIMITATION ON AMOUNT OF TOBACCO SETTLEMENT BONDS TO BE ISSUED.--The New Mexico finance authority shall issue no tobacco settlement bonds unless the aggregate amount of tobacco settlement bonds outstanding, and including the issue proposed, can be serviced with not more than forty percent of the annual deposits into the tobacco settlement bonding fund, as determined by the deposits during the preceding fiscal year.

Section 11. [NEW MATERIAL] EXPENSES PAID FROM TOBACCO SETTLEMENT BONDING FUND.--The issuance expenses and other obligations incurred for tobacco settlement bonds shall be paid from the tobacco settlement bonding fund.

Section 12. [NEW MATERIAL] TOBACCO SETTLEMENT BONDING ACT AND NEW MEXICO FINANCE AUTHORITY ACT TO BE FULL AUTHORITY FOR ISSUANCE OF BONDS.--The Tobacco Settlement Bonding Act and the New Mexico Finance Authority Act shall, without reference to any other act of the legislature, be full authority for the issuance and sale of tobacco settlement bonds, which bonds and the coupons attached thereto, if any, shall not be invalid for any irregularity or defect or be contestable in the hands of bona fide purchasers or holders thereof for value.

Section 13. [NEW MATERIAL] AGREEMENT OF THE STATE.--The state does hereby pledge to and agree with the holders of any tobacco settlement bonds issued under the Tobacco Settlement Bonding Act that the state shall not limit or alter the distribution of tobacco settlement distributions to the tobacco settlement bonding fund, amend or modify the master settlement agreement in a way that would materially impair the rights of holders of the bonds, or limit or alter the rights vested in the New Mexico finance authority to fulfill the terms of any agreements made with the holders of the bonds or in any way impair the rights and remedies of those holders until the bonds, together with the interest on the bonds, with interest on any unpaid installments of interest, and all costs and expenses in connection with any action or proceedings by or on behalf of those holders, are fully met and discharged. The New Mexico finance authority is authorized to include this pledge and agreement of the state in any agreement with the holders of the bonds.

Section 14. EFFECTIVE DATE.--The effective date of the provisions of this act is January 1, 2001.