SENATE FINANCE COMMITTEE SUBSTITUTE FOR

SENATE BILL 75

47th legislature - STATE OF NEW MEXICO - first session, 2005

AN ACT

RELATING TO AVIATION; MAKING GROSS RECEIPTS AND COMPENSATING TAX DEDUCTIONS PERTAINING TO CERTAIN FUEL APPLICABLE ONLY TO THAT FUEL SOLD TO COMMERCIAL AVIATION OPERATORS; ELIMINATING TIME LIMITATIONS ON THE DEDUCTIONS; REQUIRING THAT CERTAIN AVIATION DIVISION COLLECTIONS REVERT TO THE STATE AVIATION FUND; CREATING REPORTING REQUIREMENTS; PROVIDING DISTRIBUTIONS TO THE STATE AVIATION FUND; MAKING AN APPROPRIATION.

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

     Section 1. Section 7-1-6.7 NMSA 1978 (being Laws 1994, Chapter 5, Section 2, as amended) is amended to read:

     "7-1-6.7. DISTRIBUTIONS--STATE AVIATION FUND.--

          A. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the state aviation fund in an amount equal to four and seventy-nine hundredths percent of the taxable gross receipts attributable to the sale of fuel specially prepared and sold to commercial aviation operators for use in turboprop or jet-type engines as determined by the department.

          B. A monthly distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the state aviation fund in an amount equal to three and seven hundred seventy-five thousandths percent of the taxable gross receipts attributable to the sale of fuel specially prepared and sold to persons or entities that are not commercial aviation operators for use in turboprop or jet-type engines as determined by the department.

          [B.] C. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the state aviation fund in an amount equal to twenty-six hundredths percent of gasoline taxes, exclusive of penalties and interest, collected pursuant to the Gasoline Tax Act.

          [C.] D. From July 1, 2002 through June 30, 2007, a distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the state aviation fund in an amount equal to forty-six thousandths percent of the net receipts attributable to the gross receipts tax distributable to the general fund.

          E. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the state aviation fund from the net receipts attributable to the gross receipts tax imposed by the Gross Receipts and Compensating Tax Act in an amount equal to:

                (1) twenty thousand five hundred dollars ($20,500) monthly from July 1, 2005 through June 30, 2006;

                (2) seventy thousand dollars ($70,000) monthly from July 1, 2006 through June 30, 2007; and

                (3) two hundred fifty thousand dollars ($250,000) monthly after July 1, 2007.

          F. For the purposes of this section, "commercial aviation operator" means a person or entity that, for compensation or hire, engages in the carriage by aircraft in air commerce of persons or property in accordance with part 121 and scheduled air operations pursuant to part 135 of Title 14 of the Code of Federal Regulations."

     Section 2. Section 7-9-83 NMSA 1978 (being Laws 1993, Chapter 364, Section 1, as amended) is amended to read:

     "7-9-83. DEDUCTION--GROSS RECEIPTS TAX--JET FUEL.--

          A. [From July 1, 2003 through June 30, 2007] Fifty-five percent of the receipts from the sale of fuel specially prepared and sold to commercial aviation operators for use in turboprop or jet-type engines as determined by the department may be deducted from gross receipts.

          B. [After June 30, 2007, forty percent of the receipts from the sale of fuel specially prepared and sold for use in turboprop or jet-type engines as determined by the department may be deducted from gross receipts.] For the purposes of this section, "commercial aviation operator" means a person or entity that, for compensation or hire, engages in the carriage by aircraft in air commerce of persons or property in accordance with part 121 and scheduled air operations pursuant to part 135 of Title 14 of the Code of Federal Regulations."

     Section 3. Section 7-9-84 NMSA 1978 (being Laws 1993, Chapter 364, Section 2, as amended) is amended to read:

     "7-9-84. DEDUCTION--COMPENSATING TAX--JET FUEL.--

          A. [From July 1, 2003 through June 30, 2007] Fifty-five percent of the value of the fuel specially prepared and sold to commercial aviation operators for use in turboprop or jet-type engines as determined by the department may be deducted in computing the compensating tax due.

          B. [After June 30, 2007, forty percent of the value of the fuel specially prepared and sold for use in turboprop or jet-type engines as determined by the department may be deducted in computing the compensating tax due.] For the purposes of this section, "commercial aviation operator" means a person or entity that, for compensation or hire, engages in the carriage by aircraft in air commerce of persons or property in accordance with part 121 and scheduled air operations pursuant to part 135 of Title 14 of the Code of Federal Regulations."

     Section 4. Section 64-1-15 NMSA 1978 (being Laws 1963, Chapter 314, Section 7, as amended) is amended to read:

     "64-1-15. EARMARKED TAXES--APPROPRIATION.--

          A. There is created in the state treasury the "state aviation fund". [The state treasurer shall credit to the state aviation fund all unrefunded taxes collected on the sale of motor fuel sold for use in aircraft.] All income to the state aviation fund is appropriated to the division.

          B. Except for the amount distributed pursuant to Subsection D of Section 7-1-6.7 NMSA 1978, the amounts distributed to the state aviation fund pursuant to [Subsection A of] Section 7-1-6.7 NMSA 1978 shall be used for planning, construction and maintenance of a system of airports, navigation aids and related facilities serving New Mexico and for administrative costs of the division. The amounts distributed to the state aviation fund pursuant to Subsection [C] D of Section 7-1-6.7 NMSA 1978 shall be used for the air service assistance program. All expenditures shall be made in accordance with budgets approved by the department of [finance and administration] transportation.

          C. Reimbursement to the division, from any source other than the revenue distributed pursuant to Section 7-1-6.7 NMSA 1978, for planning, construction, equipment, materials and maintenance of airports and related facilities; collections by the division for aircraft registration pursuant to the Airport Registration Act; and payments to the division pursuant to Sections 64-1-13, 64-1-13.1 and 64-1-19 NMSA 1978 shall be deposited in the state aviation fund. Balances in the fund shall not be transferred and shall not revert to any other fund."

     Section 5. [NEW MATERIAL] REPORTING REQUIREMENT--JET FUEL SOLD.--A seller of fuel specially prepared and sold for use in turboprop or jet-type engines shall report, within thirty days of the end of each quarter of the calendar year, to the aviation division of the department of transportation the volume of gallons of that fuel sold by the seller each month.

     Section 6. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2005.

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