0001|                         HOUSE BILL 485
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0002|     42ND LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION,
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0003|     1996
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0004|                         INTRODUCED BY
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0005|                        ROBERT S. LIGHT
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0006|     
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0007|     
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0008|     
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0009|     
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0010|     
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0011|                             AN ACT
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0012|     RELATING TO OIL AND GAS; AMENDING THE OIL AND GAS PROCEEDS
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0013|     PAYMENT ACT TO CHANGE THE TIME FOR PAYMENT.
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0014|     
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0015|     BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
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0016|       Section 1.  Section 70-10-3 NMSA 1978 (being Laws 1985,
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0017|     Chapter 55, Section 3) is amended to read:
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0018|       "70-10-3.  PAYMENT OF OIL AND GAS PROCEEDS--TIME FOR
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0019|     PAYMENT.--The oil and gas proceeds derived from the sale of
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0020|     production from any well producing oil, gas or related
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0021|     hydrocarbons in New Mexico shall be paid to all persons legally
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0022|     entitled to such payments, commencing not later than <s>[six]</s>
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0023|     <u>three</u> months after the first day of the month following the
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0024|     date of first sale and thereafter not later than forty-five days
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0025|     after the end of the calendar month within which payment is
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0001|     received by payor for production unless other periods or
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0002|     arrangements are provided for in a valid contract with the
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0003|     person entitled to such proceeds.  Payment shall be made
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0004|     directly to the person or persons entitled thereto by the payor
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0005|     and payment shall be deemed to have been made upon deposit in
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0006|     the United States mail."
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0007|       Section 2.  Section 70-10-4 NMSA 1978 (being Laws 1991,
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0008|     Chapter 235, Section 3) is amended to read:
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0009|       "70-10-4.  INTEREST ON LATE PAYMENTS.--
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0010|            A.  Any delay in determining any person legally
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0011|     entitled to an interest in the proceeds from production shall
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0012|     not affect payments to all other persons entitled to payments. 
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0013|     In instances where payments cannot be made within the time
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0014|     period provided in Section 70-10-3 NMSA 1978, the payor shall
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0015|     create a suspense account on his books for such interest or may
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0016|     interplead the suspended funds into court.
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0017|            B.  The person entitled to payment from the suspended
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0018|     funds shall be entitled to interest on the suspended funds from
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0019|     the date payment is due under Section 70-10-3 NMSA 1978.  The
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0020|     interest awarded shall be the <s>[discount]</s> <u>prime</u> rate
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0021|     <s>[charged by the federal reserve bank of Dallas to member
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<s></s>0022| <s>    banks]</s> plus one and one-half percent on the date payment is
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0023|     due.  Payment of principal and interest on the suspended funds
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0024|     shall be made to all persons legally entitled to the funds
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0025|     within thirty days from the date that the persons are determined
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0001|     to be entitled to the suspended funds by a final legal
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0002|     determination. <u>As used in this subsection, "prime rate" means
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<u></u>0003| <u>    the nationally published prime rate representing the base rate
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<u></u>0004| <u>    on corporate loans posted by at least seventy-five percent of
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<u></u>0005| <u>    the nation's thirty largest banks</u>."
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0006|                              
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0007|     
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