45th legislature - STATE OF NEW MEXICO - second session, 2002
RELATING TO HEALTH; ENACTING THE SUBSTANCE ABUSE TREATMENT ACT; PROVIDING FOR NEEDED SUBSTANCE ABUSE PROGRAMS OPERATED BY COUNTIES, MUNICIPALITIES, THE DEPARTMENT OF HEALTH OR PRIVATE ORGANIZATIONS; FUNDING THE PROGRAMS THROUGH A SURTAX ON CIGARETTES; MAKING AN APPROPRIATION.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
Section 1. [NEW MATERIAL] SHORT TITLE.--Sections 1 through 6 of this act may be cited as the "Substance Abuse Treatment Act".
Section 2. [NEW MATERIAL] DEFINITIONS.--As used in the Substance Abuse Treatment Act:
A. "department" means the department of health;
B. "fund" means the substance abuse treatment fund;
C. "program" means a full array of treatment services offered by a county, a municipality, the department or a private organization, individually or jointly, with the purpose of providing services for substance abusers; and
D. "substance abuser" means any person requesting treatment for substance abuse.
Section 3. [NEW MATERIAL] SUBSTANCE ABUSE TREATMENT FUND--ESTABLISHED.--There is created in the state treasury the "substance abuse treatment fund". Earnings of the fund shall be credited to the fund, and balances in the fund shall not revert or be transferred to any other fund. Balances in the fund are appropriated to the department for the purpose of providing programs and services for the treatment of substance abusers pursuant to the Substance Abuse Treatment Act. Disbursements from the fund shall be made only upon warrant drawn by the secretary of finance and administration pursuant to vouchers signed by the secretary of health.
Section 4. [NEW MATERIAL] FUND--ADMINISTRATION.--The department shall administer the fund and make grants to counties, municipalities or private organizations, individually or jointly, for the purpose of providing programs pursuant to the provisions of the Substance Abuse Treatment Act. The department may also utilize the fund to contract directly for programs. The department shall use no more than ten percent of the annual expenditures from the fund for administration and monitoring purposes by the state and shall allow no more than ten percent of a grant from the fund to be used for administrative costs incurred by counties, municipalities or private organizations. After proper notice and public hearings, the department shall, by rule, adopt qualification standards for grants, priorities for awarding of funds and other criteria regarding programs operated and grants made pursuant to the provisions of the Substance Abuse Treatment Act.
Section 5. [NEW MATERIAL] CRITERIA FOR APPLICATIONS--APPLICATION REVIEW PANEL.--
A. Counties, municipalities or private organizations, individually or jointly, may apply for grants from the fund, including grants for counties or municipalities to purchase contractual services from private organizations. Applications shall contain:
(1) details concerning how the applicant intends to serve and treat drug abusers, including criteria for determining how persons eligible for treatment will be selected;
(2) evidence that the applicant is willing and able to operate the program according to standards provided by the department;
(3) letters or other documents showing that the applicant has the support of key drug abuse professionals, agencies, county DWI planning councils and other concerned entities in the community in which the program will be conducted; and
(4) any other information required by rule of the department.
B. The department shall establish a panel to review all applications for funding and make recommendations to the secretary of health regarding each application. The panel shall be appointed by the secretary of health and shall include substance abuse professionals, substance abuse providers and representatives of the general public. The secretary, after considering the recommendations of the panel, shall prioritize the applications and, to the extent that money is available in the fund, award program grants; provided that:
(1) no grant shall be made for a program that is inconsistent with the statewide substance abuse services plan developed pursuant to Section 43-3-13 NMSA 1978; and
(2) no class A county, alone or in conjunction with any municipality within a class A county, shall receive more than forty-nine percent of the total grants made in any single fiscal year.
Section 6. [NEW MATERIAL] ANNUAL REPORT.--The department shall submit an annual report to the governor and the legislature not later than December 15 of each year. The report shall include a summary of funding awards, an analysis of program effectiveness, a summary of monitoring efforts and future recommendations.
Section 7. A new section of the Tax Administration Act is enacted to read:
"[NEW MATERIAL] DISTRIBUTION--SUBSTANCE ABUSE TREATMENT SURTAX.--
A. Except as provided in Subsection B of this section, a distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the substance abuse treatment fund in an amount equal to the net receipts, exclusive of penalties and interest, attributable to the substance abuse treatment surtax.
B. In any fiscal year, after the amount distributed pursuant to Subsection A of this section equals twenty million dollars ($20,000,000), the remaining distributions during that fiscal year of the net receipts, exclusive of penalties and interest, attributable to the substance abuse treatment surtax shall be made, pursuant to Section 7-1-6.1 NMSA 1978, to the general fund."
Section 8. Section 7-1-28 NMSA 1978 (being Laws 1965, Chapter 248, Section 30, as amended) is amended to read:
"7-1-28. AUTHORITY FOR ABATEMENTS OF ASSESSMENTS OF TAX.--
A. In response to a written protest against an assessment, submitted in accordance with the provisions of Section 7-1-24 NMSA 1978, but before any court acquires jurisdiction of the matter, or when a "notice of assessment of taxes" is found to be incorrect, the secretary or the secretary's delegate, with the prior written approval of the attorney general, may abate any part of an assessment determined by the secretary or the secretary's delegate to have been incorrectly, erroneously or illegally made, except that:
(1) abatements with respect to the Oil and Gas Severance Tax Act, the Oil and Gas Conservation Tax Act, the Oil and Gas Emergency School Tax Act, the Oil and Gas Ad Valorem Production Tax Act, the Natural Gas Processors Tax Act or the Oil and Gas Production Equipment Ad Valorem Tax Act, abatements of gasoline tax made under Section 7-13-17 NMSA 1978 and abatements of cigarette tax and substance abuse treatment surtax made under the Cigarette Tax Act may be made without the prior approval of the attorney general regardless of the amount;
(2) abatements with respect to the Corporate Income and Franchise Tax Act amounting to less than twenty thousand dollars ($20,000) may be made without prior approval of the attorney general; and
(3) abatements amounting to less than five thousand dollars ($5,000) may be made without the prior written approval of the attorney general.
B. Pursuant to the final order of the district court for Santa Fe county, the court of appeals, the supreme court of New Mexico or any federal court, from which order, appeal or review is not successfully taken by the department, adjudging that any person is not required to pay any portion of tax assessed to that person, the secretary or the secretary's delegate shall cause that amount of the assessment to be abated.
C. Pursuant to a compromise of taxes agreed to by the secretary and according to the terms of the closing agreement formalizing the compromise, the secretary or the secretary's delegate shall cause the abatement of the appropriate amount of any assessment of tax.
D. The secretary or the secretary's delegate shall cause the abatement of the amount of an assessment of tax that is equal to the amount of fee paid to or retained by an out-of-state attorney or collection agency from a judgment or the amount collected by the attorney or collection agency pursuant to Section 7-1-58 NMSA 1978.
E. Records of abatements made in excess of five thousand dollars ($5,000) shall be available for inspection by the public. The department shall keep such records for a minimum of three years from the date of the abatement."
Section 9. Section 7-1-29 NMSA 1978 (being Laws 1965, Chapter 248, Section 31, as amended) is amended to read:
"7-1-29. AUTHORITY TO MAKE REFUNDS OR CREDITS.--
A. In response to a claim for refund made as provided in Section 7-1-26 NMSA 1978, but before any court acquires jurisdiction of the matter, the secretary or the secretary's delegate may authorize the refund to a person of the amount of any overpayment of tax determined by the secretary or the secretary's delegate to have been erroneously made by the person, together with allowable interest. Any refund of tax and interest erroneously paid and amounting to more than five thousand dollars ($5,000) may be made to any one person only with the prior approval of the attorney general, except that:
(1) refunds with respect to the Oil and Gas Severance Tax Act, the Oil and Gas Conservation Tax Act, the Oil and Gas Emergency School Tax Act, the Oil and Gas Ad Valorem Production Tax Act, the Natural Gas Processors Tax Act or the Oil and Gas Production Equipment Ad Valorem Tax Act, refunds of gasoline tax made under Section 7-13-17 NMSA 1978 and refunds of cigarette tax and substance abuse treatment surtax made under the Cigarette Tax Act may be made without the prior approval of the attorney general regardless of the amount; and
(2) refunds with respect to the Corporate Income and Franchise Tax Act amounting to less than twenty thousand dollars ($20,000) may be made without the prior approval of the attorney general.
B. Pursuant to the final order of the district court, the court of appeals, the supreme court of New Mexico or any federal court, from which order, appeal or review is not successfully taken, adjudging that any person has made an overpayment of tax, the secretary shall authorize the refund to the person of the amount thereof.
C. In the discretion of the secretary, any amount of tax due to be refunded may be offset against any amount of tax for the payment of which the person due to receive the refund is liable.
D. In an audit by the department or a managed audit covering multiple reporting periods where both underpayments and overpayments of a tax are found to have been made in different reporting periods, the department shall credit the tax overpayments found against the underpayments, provided that the taxpayer files a claim for refund of the overpayments. An overpayment shall be applied as a credit first to the earliest underpayment found and then to succeeding underpayments. An underpayment of tax to which an overpayment is credited pursuant to this section shall be deemed paid in the period in which the overpayment was made or the period in which the overpayment was credited against an underpayment, whichever is later. If the overpayments credited pursuant to this section exceed the underpayments found for a tax, the amount of the net overpayment for the periods covered in the audit shall be refunded to the taxpayer.
E. Records of refunds made in excess of five thousand dollars ($5,000) shall be available for inspection by the public. The department shall keep such records for a minimum of three years from the date of the refund."
Section 10. Section 7-12-3.1 NMSA 1978 (being Laws 1986, Chapter 13, Section 3, as amended) is amended to read:
"7-12-3.1. CIGARETTE INVENTORY TAX--IMPOSITION OF TAX--DATE PAYMENT OF TAX DUE.--
A. A cigarette inventory tax is imposed, measured by the quantity of cigarette stamps, whether or not affixed to packages of cigarettes, in the possession of a person who is required by Subsection C of Section 7-12-5 NMSA 1978 to affix stamps on the date on which an increase in the excise tax imposed by Section 7-12-3 NMSA 1978 is effective or on the date on which the imposition of the substance abuse treatment surtax is effective. The taxable event is the existence of an inventory of cigarette stamps, whether or not affixed to packages of cigarettes, in the possession of a person who is required by Subsection C of Section 7-12-5 NMSA 1978 to affix stamps on the date on which an increase in the excise tax imposed by Section 7-12-3 NMSA 1978 is effective or on the date on which the imposition of the substance abuse treatment surtax is effective. The rate of the cigarette inventory tax to apply to cigarette stamps held in inventory shall be the amount of the increase in the cigarette tax imposed by Section 7-12-3 NMSA 1978 or the amount of the substance abuse treatment surtax imposed by Section 7-12-3.3 NMSA 1978.
B. The cigarette inventory tax is to be paid to the department on or before the twenty-fifth day of the month following the month in which the taxable event occurs."
Section 11. Section 7-12-3.2 NMSA 1978 (being Laws 1986, Chapter 13, Section 4) is amended to read:
"7-12-3.2. CIGARETTE INVENTORIES.--
A. On any date on which the excise tax imposed by Section 7-12-3 NMSA 1978 is increased or the date on which the substance abuse treatment surtax is imposed by Section 7-12-3.3 NMSA 1978, each person who is required by Subsection C of Section 7-12-5 NMSA 1978 to affix stamps shall take inventory of cigarette stamps on hand, including stamps affixed to packages of cigarettes.
B. Each person required to take an inventory by Subsection A of this section shall report the total number of cigarette stamps in inventory on the date on which the tax imposed by Section 7-12-3 NMSA 1978 changes on the date that the tax imposed by Section 7-12-3.3 NMSA 1978 is effective and pay any tax due imposed by Section 7-12-3.1 NMSA 1978."
Section 12. A new section of the Cigarette Tax Act, Section 7-12-3.3 NMSA 1978, is enacted to read:
"7-12-3.3. [NEW MATERIAL] SUBSTANCE ABUSE TREATMENT SURTAX.--
A. In addition to the tax levied in Section 7-12-3 NMSA 1978, for the privilege of selling, giving or consuming cigarettes in New Mexico, there is levied an additional excise tax of one and seventy-five hundredths cents ($.0175) for each cigarette sold, given or consumed in this state.
B. The tax imposed by this section shall be referred to as the "substance abuse treatment surtax"."
Section 13. Section 7-12-4 NMSA 1978 (being Laws 1971, Chapter 77, Section 4, as amended) is amended to read:
"7-12-4. EXEMPTION.--
A. Exempted from the cigarette tax and the substance abuse treatment surtax are sales of cigarettes:
(1) to the United States or any agency or instrumentality thereof or the state of New Mexico or any political subdivision thereof;
(2) to the governing body, or to any enrolled tribal member licensed by the governing body, of any Indian nation, tribe or pueblo for use or sale on that reservation or pueblo grant; and
(3) sales which the state is prohibited from taxing by a provision of the United States constitution or the constitution of the state of New Mexico.
B. As used in this section, the term "agency or instrumentality" does not include persons who are agents or instrumentalities of the United States for a particular purpose or only when acting in a particular capacity or corporate agencies or instrumentalities."
Section 14. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2002.