45th legislature - STATE OF NEW MEXICO - first session, 2001

RELATING TO PUBLIC FINANCE; GIVING GREATER DISCRETION TO THE STATE BOARD OF FINANCE FOR THE ALLOCATION OF THE STATE'S PRIVATE ACTIVITY BOND CEILING; EXPANDING THE DEFINITION OF "ISSUING AUTHORITY"; AMENDING SECTIONS OF THE NMSA 1978.

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

Section 1. Section 6-20-2 NMSA 1978 (being Laws 1988, Chapter 46, Section 2) is amended to read:

"6-20-2. DEFINITIONS.--

A. As used in the Private Activity Bond Act:

(1) "allocation" means an allocation of the state ceiling issued by the board to an issuing authority to issue private activity bonds;

(2) "allocation expiration date" means the expiration date for issuance of private activity bonds or making a mortgage credit certificate election set forth in the board allocation, which shall be the earlier of one hundred twenty days from the date of issuance of the allocation or the bond issuance expiration date for the calendar year of the allocation [provided, however, that in the case of allocations issued pursuant to Subsection A or B of Section 3 of the Private Activity Bond Act, "allocation expiration date" means July 1 of the calendar year of the allocation];

(3) "board" means the state board of finance;

(4) "bond counsel" means an attorney or a firm of attorneys listed in the most recently available "directory of municipal bond dealers of the United States", published by the bond buyer and commonly known as the "red book", in the section listing municipal bond attorneys of the United States, or the successor publication thereto;

(5) "bond issuance expiration date" means the date, not later than December 26, selected annually by the board upon which all unexpired allocations issued for the calendar year shall expire except to the extent that any unexpired allocation has been used by an issuing authority prior to such date to issue private activity bonds or make a mortgage credit certificate election;

(6) "carryforward election allocation" means an allocation of the state ceiling issued by the board pursuant to the Private Activity Bond Act which an issuing authority may elect to treat as a carryforward under Section 146 of the code;

(7) "carryforward purpose" means:

(a) the purpose of issuing exempt facility bonds;

(b) the purpose of issuing qualified mortgage bonds or mortgage credit certificates;

(c) the purpose of issuing qualified student loan bonds; and

(d) the purpose of issuing qualified redevelopment bonds;

(8) "code" means the Internal Revenue Code of 1986, as amended;

(9) "confirmation" means the confirmation of bond issuance furnished to the board;

(10) "inducement resolution" means a resolution expressing an intent to issue private activity bonds for a project;

(11) "issuing authority" means the state, state agencies, regional housing authorities, counties, [and] incorporated municipalities and any other governmental entity permitted by state law to issue private activity bonds;

(12) "mortgage credit certificate election" means an election pursuant to Section 25(c)(2)(A)(ii) of the code, by an issuing authority not to issue qualified mortgage bonds which the issuing authority is otherwise authorized to issue, in exchange for the authority under Section 25 of the code to issue mortgage credit certificates in connection with a qualified mortgage credit certificate within the meaning of Section 25(c)(2) of the code;

(13) "private activity bond" means:

(a) any bond or other obligation which is a qualified private activity bond under Section 141 of the code which is not excluded by Section 146(g), (h) and (i) of the code or a bond or other obligation issued under Section 1312 or 1313 of the Tax Reform Act of 1986; and

(b) the private activity portion of government use bonds allocated by an issuing authority to an issue under Section 141(b)(5) of the code;

(14) "project" means any facilities which can be financed with private activity bonds which are not qualified student loan bonds or qualified mortgage bonds;

(15) "qualified mortgage bond" means a bond or obligation which is issued as part of a qualified mortgage issue under Section 143 of the code;

(16) "qualified student loan bond" means any bond issued as part of an issue of which the applicable percentage or more of the net proceeds thereof are to be used directly or indirectly to make or finance student loans under programs identified by Section 144(b) of the code;

(17) "regulations" means the regulations promulgated by the internal revenue service under the code or under the Internal Revenue Code of 1954, as amended;

(18) "request for allocation" means the request of an issuing authority pursuant to the Private Activity Bond Act;

(19) "request for carryforward election allocation" means the request of an issuing authority pursuant to the Private Activity Bond Act;

(20) "state" means the state of New Mexico;

(21) "state agency" means the New Mexico industrial and agricultural finance authority, the New Mexico educational assistance foundation, the New Mexico mortgage finance authority and any other agency, authority, instrumentality, corporation or body, now existing or hereafter created, which under state law [can] may issue private activity bonds on behalf of the state;

(22) "state ceiling" means, for any calendar year, the greater of an amount equal to fifty dollars ($50.00) multiplied by the state population as shown by the most recent census estimate of the resident population of the state released by the United States bureau of census before the beginning of such calendar year or one hundred fifty million dollars ($150,000,000) or such different amount as may be provided by Section 146(d) of the code;

(23) "state private activity bond fund" means the fund into which the unallocated and unused state ceiling is set aside [on July 1 in each calendar year] and from which issuing authorities may receive carryforward election allocations and allocations to fund the issuance of private activity bonds and the making of mortgage credit certificate elections; and

(24) "user" means the user of proceeds of private activity bonds for a project.

B. The word "issue" or "issued", when used in the context of an issuing authority issuing a private activity bond, means the physical delivery of the evidences of indebtedness in exchange for the amount of the purchase price.

C. References in the Private Activity Bond Act to particular sections of the code or the regulations shall be deemed also to refer to any successor or recodification sections."

Section 2. Section 6-20-3 NMSA 1978 (being Laws 1988, Chapter 46, Section 3) is amended to read:

"6-20-3. ALLOCATION OF STATE CEILING.--[A. Until July 1 in any calendar year, forty percent of] The board shall allocate the state ceiling for the calendar year [shall be allocated to state agencies as a group; provided, however, that such allocation shall be made] in accordance with directives, rules or regulations governing the distribution of allocations to be established by the board.

[B. Until July 1 in any calendar year, sixty percent of the state ceiling for the calendar year shall be allocated to issuing authorities that are not state agencies, as a group; provided, however, that such allocations shall be made in accordance with directives, rules or regulations governing the distribution of allocations to be established by the board.

C. On July 1 of each calendar year, the amount of any allocation issued by the board pursuant to Subsection A or B of section 3 of the Private Activity Bond Act shall expire and shall be automatically set aside into the state private activity bond fund, except to the extent that an allocation has been used by an issuing authority prior to July 1 to issue private activity bonds or to make a mortgage credit certificate election.

D. From July 1 through December 31 in any calendar year, the board shall prescribe the allocation of the state ceiling.]"

Section 3. Section 6-20-5 NMSA 1978 (being Laws 1988, Chapter 46, Section 5) is amended to read:

"6-20-5. REQUEST FOR ALLOCATION.--A request for allocation may be submitted to the board at any time and shall consist of the following:

A. a letter from the issuing authority or, in the case of a project, a letter from bond counsel for the issuing authority or the user stating the amount of the state ceiling requested in dollars;

B. in the case of a project, a copy of the inducement resolution, certified by an official of the issuing authority, and a statement of bond counsel for the issuing authority or the user that the bonds to be issued are qualified private activity bonds that require an allocation of the state ceiling;

C. [with respect to a request submitted on or after July 1 in any calendar year] in the case of a project, a project plan containing the following, if applicable:

(1) a description of the project and its specific location;

(2) the estimated number of jobs, both construction and permanent, which can be filled by persons who are residents of the state at the time of submission of the request for allocation;

(3) the [present] current use or conditions of the project site;

(4) the maximum amount of the bonds to be issued;

(5) a proposed starting date and estimated completion date of the construction project;

(6) information relating to the feasibility of the proposed project, showing that the project will generate revenues and cash flow sufficient to make payments under the lease or installment sale agreement;

(7) the amount and source of private capital which will be used for the project in addition to bond financing;

(8) conceptual site plans for the project and a map locating the project area;

(9) in the case of qualified residential rental projects, so-called multifamily housing, an explanation of why the housing needs of individuals whose income will make them eligible under Section 142(d) of the code are not being met by existing multifamily housing;

(10) any other information which the user believes will aid the board in considering the request for allocation; and

(11) any other information specifically requested by the board;

D. in the case of a project, a commitment letter from the proposed purchaser or underwriter of the bonds; and

E. in the case of a mortgage credit certificate election, a letter from the issuing authority stating that a qualified mortgage credit certificate program has been adopted by the issuing authority."

Section 4. Section 6-20-6 NMSA 1978 (being Laws 1988, Chapter 46, Section 6) is amended to read:

"6-20-6. ALLOCATION.--After considering a request for allocation, the board may within a reasonable time, as determined by the board, issue an allocation [provided, however, that an allocation requested by an issuing authority pursuant to Subsection A or B of Section 3 of the Private Activity Bond Act shall be issued by the board within a reasonable time after a request for allocation is submitted to the board]. An allocation shall state the amount, in dollars, of the state ceiling allocated and shall state the allocation expiration date."