SENATE BILL 228

52nd legislature - STATE OF NEW MEXICO - second session, 2016

INTRODUCED BY

Richard C. Martinez

AN ACT

AUTHORIZING THE ISSUANCE OF SEVERANCE TAX BONDS FOR A PRISON IN NORTH CENTRAL NEW MEXICO; MAKING AN APPROPRIATION.

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

     SECTION 1. SEVERANCE TAX BONDS--AUTHORIZATION--APPROPRIATION OF PROCEEDS.--

          A. The state board of finance may issue and sell severance tax bonds in compliance with the Severance Tax Bonding Act in an amount not to exceed twenty million dollars ($20,000,000) to plan, design, construct, equip and furnish a state prison in north central New Mexico. The state board of finance shall schedule the issuance and sale of the bonds in the most expeditious and economical manner possible upon a finding by the board that the project has been developed sufficiently to justify the issuance and that the project can proceed to contract within a reasonable time. The state board of finance shall further take the appropriate steps necessary to comply with the federal Internal Revenue Code of 1986, as amended. Proceeds from the sale of the bonds are appropriated to the capital program fund for the purpose specified in this section.

          B. The general services department shall certify to the state board of finance when the money from the proceeds of the severance tax bonds appropriated in this section is needed for the purposes specified in this section. If the department has not certified the need for severance tax bond proceeds for the project by the end of fiscal year 2018, the authorization for that project is void.

          C. Before the general services department may certify for the need of severance tax bond proceeds, the project must be developed sufficiently so that the agency reasonably expects to:

                (1) incur within six months after the applicable bond proceeds are available for the project a substantial binding obligation to a third party to expend at least five percent of the bond proceeds for the project; and

                (2) spend at least eighty-five percent of the bond proceeds within three years after the applicable bond proceeds are available for the project.

          D. The unexpended balance from the proceeds of severance tax bonds appropriated in this section shall revert to the severance tax bonding fund no later than six months after completion of the project, but no later than the end of fiscal year 2020.

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