2005 Senate Bill text for SB0845

SENATE BILL 845

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

INTRODUCED BY

Mary Kay Papen

AN ACT

RELATING TO TAXATION; PROVIDING FOR VOTER APPROVAL OF THE ISSUANCE OF BONDS SECURED BY PROPERTY TAXES PURSUANT TO THE TAX INCREMENT LAW; PROVIDING ELECTION PROCEDURES FOR THE FORMATION OF DISTRICTS; PROVIDING FOR FINANCING OF METROPOLITAN REDEVELOPMENT PROJECTS BY THE ISSUANCE OF BONDS SECURED BY CERTAIN MUNICIPAL GROSS RECEIPTS TAX REVENUE INCREASES ATTRIBUTABLE TO THOSE DISTRICTS; CREATING A FUND; PROVIDING DISTRIBUTIONS; MAKING AN APPROPRIATION.

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

Section 1. Section 3-60A-19 NMSA 1978 (being Laws 1979, Chapter 391, Section 19) is amended to read:

"3-60A-19. TAX INCREMENT LAW--SHORT TITLE.--Sections [19 through 25 of the Metropolitan Redevelopment Code] 3-60A-19 through 3-60A-25 NMSA 1978 may be cited as the "Tax Increment Law"."

Section 2. Section 3-60A-20 NMSA 1978 (being Laws 1979, Chapter 391, Section 20) is amended to read:

"3-60A-20. ALTERNATIVE METHOD OF FINANCING.--

A. [Effective for tax years beginning on or after January 1, 1980] After obtaining necessary approval pursuant to Section 3-60A-23 NMSA 1978, the local governing body [of a municipality] may elect by [resolution] ordinance to use the procedures set forth in the Tax Increment Law for financing metropolitan redevelopment projects. Such procedures may be used in addition to or in conjunction with other methods provided by law for financing such projects.

B. The tax increment method, for the purpose of financing metropolitan redevelopment projects, is the dedication for further use in metropolitan redevelopment projects of that increase in property tax revenue directly resulting from the increased net taxable value of a parcel of property attributable to its rehabilitation, redevelopment or other improvement because of its inclusion within an urban renewal, community development or metropolitan redevelopment project."

Section 3. Section 3-60A-21 NMSA 1978 (being Laws 1979, Chapter 391, Section 21, as amended) is amended to read:

"3-60A-21. TAX INCREMENT PROCEDURES.--The procedures to be used in the tax increment method are:

A. the local governing body [of the municipality] shall, at the time [after] of elector approval of the issuance of tax increment bonds for a metropolitan redevelopment project, notify the county assessor and the taxation and revenue department of the taxable parcels of property within the project;

B. upon receipt of notification pursuant to Subsection A of this section, the county assessor and the taxation and revenue department shall identify the parcels of property within the metropolitan redevelopment project within their respective jurisdictions and certify to the county treasurer the net taxable value of the property at the time of notification as the base value for the distribution of property tax revenues authorized by the Property Tax Code. If because of acquisition by the municipality the property becomes tax exempt, the county assessor and the taxation and revenue department shall note that fact on their respective records and so notify the county treasurer, but the county assessor, the taxation and revenue department and the county treasurer shall preserve a record of the net taxable value at the time of inclusion of the property within the metropolitan redevelopment project as the base value for the purpose of distribution of property tax revenues when the parcel again becomes taxable. The county assessor is not required by this section to preserve the new taxable value at the time of inclusion of the property within the metropolitan redevelopment project as the base value for the purposes of valuation of the property;

C. if because of acquisition by the municipality the property becomes tax exempt, when the parcel again becomes taxable, the local governing body [of the municipality] shall notify the county assessor and the taxation and revenue department of the parcels of property that because of their rehabilitation or other improvement are to be revalued for property tax purposes. A new taxable value of this property shall then be determined by the county assessor or by the taxation and revenue department if the property is within the valuation jurisdiction of that department. If no acquisition by the municipality occurs, improvement or rehabilitation of property subject to valuation by the assessor shall be reported to the assessor as required by the Property Tax Code, and the new taxable value shall be determined as of January 1 of the tax year following the year in which the improvement or rehabilitation is completed;

D. current tax rates shall then be applied to the new taxable value. The amount by which the revenue received exceeds that which would have been received by application of the same rates to the base value before inclusion in the metropolitan redevelopment project shall be credited to the municipality and deposited in the metropolitan redevelopment fund. This transfer shall take place only after the county treasurer has been notified to apply the tax increment method to a specific property included in a metropolitan redevelopment area. Unless the entire metropolitan redevelopment area is specifically included by the municipality for purposes of tax increment financing, the payment by the county treasurer to the municipality shall be limited to those properties specifically included. The remaining revenue shall be distributed to participating units of government as authorized by the Property Tax Code; and

E. the procedures and methods specified in this section shall be followed annually for a maximum period of twenty years following the date of notification of inclusion of property as coming under the transfer provisions of this section."

Section 4. Section 3-60A-23 NMSA 1978 (being Laws 1979, Chapter 391, Section 23, as amended) is amended to read:

"3-60A-23. TAX INCREMENT METHOD APPROVAL.--The tax increment method shall be applicable only to the units of government participating in property tax revenue derived from property within a metropolitan redevelopment project and approving the use of the tax increment method for that property and only to the extent of the approval. An approval may be restricted to certain types or sources of tax revenue. The local governing body [of each municipality] shall request such approval for up to a twenty-year period for property included in the tax increment funding. The governor or his authorized representative shall approve, partially approve or disapprove the use of the method for state government; the governing body of each other participating unit shall approve, partially approve or disapprove by ordinance or resolution the use of the method for their respective units. At the request of a participating unit of government, made within ten days of receipt of the request by the municipality, the municipality shall make a presentation to the governor or his authorized representative and to the governing bodies of all participating units of government, which presentation shall include a description of the metropolitan redevelopment project and the parcels in the project to which the tax increment method [will] is proposed to apply, and an estimate of the general effect of the project and the application of the tax increment method on property values and tax revenues. All participating units shall notify the local governing body [of the municipality] seeking approval within thirty days of receipt of the municipality's request. At the expiration of that time, the alternative method of financing set forth in this section shall be effective for a period of up to twenty tax years."

Section 5. Section 3-60A-23.1 NMSA 1978 (being Laws 2000, Chapter 103, Section 4) is amended to read:

"3-60A-23.1. TAX INCREMENT BONDS.--

A. [For the purpose of financing metropolitan redevelopment projects, in whole or in part, a] Upon approval of the qualified electors of a metropolitan redevelopment area of the issuance of tax increment bonds for a metropolitan redevelopment project within the metropolitan redevelopment area, the municipality [may] shall issue tax increment bonds or tax increment bond anticipation notes that are payable from and secured by real property taxes, in whole or in part, allocated to the metropolitan redevelopment fund pursuant to the provisions of Sections 3-60A-21 and 3-60A-23 NMSA 1978. The principal of, premium, if any, and interest on the bonds or notes shall be payable from and secured by a pledge of such revenues, and the municipality shall irrevocably pledge all or part of such revenues to the payment of the bonds or notes. The revenues deposited in the metropolitan redevelopment fund or the designated part thereof may thereafter be used only for the payment of the principal of, premium, if any, and interest on the bonds or notes, and a holder of the bonds or notes shall have a first lien against the revenues deposited in the metropolitan redevelopment fund or the designated part thereof for the payment of principal of, premium, if any, and interest on such bonds or notes. [To increase the security and marketability of the tax increment bonds or notes, the municipality may:

(1) create a lien for the benefit of the bondholders on any public improvements or public works used solely by the metropolitan redevelopment project or portion of a project financed by the bonds or notes, or on the revenues of such improvements or works;

(2) provide that the proceeds from the sale of real and personal property acquired with the proceeds from the sale of bonds or notes issued pursuant to the Tax Increment Law shall be deposited in the metropolitan redevelopment fund and used for the purposes of repayment of principal of, premium, if any, and interest on such bonds or notes; and

(3) make covenants and do any and all acts not inconsistent with law as may be necessary, convenient or desirable in order to additionally secure the bonds or notes or make the bonds or notes more marketable in the exercise of the discretion of the local governing body.]

B. Bonds and notes issued pursuant to this section [shall not constitute an indebtedness within the meaning of any constitutional or statutory debt limitation or restriction] shall not be general obligations of the municipality, shall be collectible only from the proper pledged revenues and shall not be subject to the provisions of any other law or charter relating to the authorization, issuance or sale of tax increment bonds or tax increment bond anticipation notes. Bonds and notes issued pursuant to the Tax Increment Law are declared to be issued for an essential public and governmental purpose and, together with interest thereon, shall be exempted from all taxes by the state.

C. The bonds or notes [shall be authorized by an ordinance of the municipality] shall be in such denominations, bear such date and mature, in the case of bonds, at such time not exceeding twenty years from their date, and in the case of notes, not exceeding five years from the date of the original note; bear interest at a rate or have appreciated principal value not exceeding the maximum net effective interest rate permitted by the Public Securities Act; and be in such form, carry such registration privileges, be executed in such manner, be payable in such place within or without the state, be payable at intervals or at maturity and be subject to such terms of redemption as the authorizing ordinance or supplemental resolution [or resolutions] of the municipality may provide.

D. The bonds or notes may be sold in one or more series at, below or above par, at public or private sale, in such manner and for such price as the municipality, in its discretion, shall determine; provided that the price at which the bonds or notes are sold shall not result in a net effective interest rate that exceeds the maximum permitted by the Public Securities Act. As an incidental expense of a metropolitan redevelopment project or portion thereof financed with the bonds or notes, the municipality in its discretion may employ financial and legal consultants with regard to the financing of the project.

E. In case any of the public officials of the municipality whose signatures appear on any bonds or notes issued pursuant to the Tax Increment Law shall cease to be public officials before the delivery of the bonds or notes, the signatures shall, nevertheless, be valid and sufficient for all purposes, the same as if the officials had remained in office until delivery. Any provision of law to the contrary notwithstanding, any bonds or notes issued pursuant to the Tax Increment Law shall be fully negotiable.

F. In any suit, action or proceeding involving the validity or enforceability of any bond or note issued pursuant to the Tax Increment Law or the security therefor, any bond or note reciting in substance that it has been issued by the municipality in connection with a metropolitan redevelopment project shall be conclusively deemed to have been issued for such purpose and the project shall be conclusively deemed to have been planned, located and carried out in accordance with the provisions of the Metropolitan Redevelopment Code.

G. The proceedings under which tax increment bonds or tax increment bond anticipation notes are authorized to be issued and any mortgage, deed of trust, trust indenture or other lien or security device on real and personal property given to secure the same may contain provisions customarily contained in instruments securing bonds and notes and constituting a covenant with the bondholders.

H. A municipality may issue bonds or notes pursuant to this section with the proceeds from the bonds or notes to be used as other money is authorized to be used in the Metropolitan Redevelopment Code.

[I. The municipality shall have the power to issue renewal notes, to issue bonds to pay notes and whenever it deems refunding expedient, to refund any bonds by the issuance of new bonds, whether the bonds to be refunded have or have not matured, and to issue bonds partly to refund bonds then outstanding and partly for other purposes in connection with financing metropolitan redevelopment projects, in whole or in part. Refunding bonds issued pursuant to the Tax Increment Law to refund outstanding tax increment bonds shall be payable from real property tax revenues, out of which the bonds to be refunded thereby are payable or from other lawfully available revenues.

J.] I. The proceeds from the sale of any bonds or notes shall be applied only for the purpose for which the bonds or notes were issued and if, for any reason, any portion of the proceeds are not needed for the purpose for which the bonds or notes were issued, the unneeded portion of the proceeds shall be applied to the payment of the principal of or the interest on the bonds or notes.

[K.] J. The cost of financing a metropolitan redevelopment project shall be deemed to include the actual cost of acquiring a site and the cost of the construction of any part of a project, including architects' and engineers' fees, the purchase price of any part of a project that may be acquired by purchase and all expenses in connection with the authorization, sale and issuance of the bonds or notes to finance the acquisition, and any related costs incurred by the municipality.

[L.] K. No action shall be brought questioning the legality of any contract, mortgage, deed of trust, trust indenture or other lien or security device, proceeding or bonds or notes executed in connection with any project authorized by the Metropolitan Redevelopment Code on and after thirty days from the effective date of the ordinance authorizing the issuance of such bonds or notes."

Section 6. A new section of the Tax Increment Law is enacted to read:

"[NEW MATERIAL] TAX INCREMENT BONDS--VOTER APPROVAL--ELECTIONS.--

A. Upon approving or obtaining approval for the tax increment method for a metropolitan redevelopment project pursuant to Section 3-60A-23 NMSA 1978 and electing by ordinance to issue tax increment bonds for that metropolitan redevelopment project, the local governing body shall submit to a vote of the qualified electors of the municipality in which the metropolitan redevelopment project is located the question of issuing the tax increment bonds or tax increment notes to fund the metropolitan redevelopment project. The election may be held at the same time as the regular municipal election or at any special election within the metropolitan redevelopment area held for that purpose.

B. The local governing body shall give notice of the time and place of holding the election and the purpose for which the tax increment bonds are to be issued. Notice of a tax increment bond election shall be given as required for any bond election as required in the Municipal Election Code for special elections. A change in the location of a polling place after notice has been given shall not invalidate a tax increment bond election.

C. The question shall state the purpose of the metropolitan redevelopment project for which the tax increment bonds are to be issued and the amount of the issue. If tax increment bonds are to be issued for more than one metropolitan redevelopment project, a separate question shall be submitted to the voters for the purpose of each metropolitan redevelopment project to be voted upon. The ballots shall contain words indicating the purpose of the metropolitan redevelopment project for which the tax increment bonds are to be issued and a place for a vote "For tax increment bonds" and "Against tax increment bonds" for each tax increment bond issue. The ballots shall be deposited in a separate ballot box unless voting machines are used.

D. The vote upon each question proposing to issue tax increment bonds shall be canvassed as provided in the Municipal Election Code, and the municipal clerk shall certify the results of the election and file the certificate of canvass in the official minute book of the municipality.

E. If a majority of those voting on the question favors the issuance of tax increment bonds, the local governing body may proceed to issue the tax increment bonds in accordance with the Tax Increment Law."

Section 7. [NEW MATERIAL] SHORT TITLE.--Sections 7 through 25 of this act may be cited as the "Metropolitan Redevelopment Tax Act".

Section 8. [NEW MATERIAL] DEFINITIONS.--As used in the Metropolitan Redevelopment Tax Act:

A. "blighted area" means an area within the area of operation, other than a slum area, which, by reason of the presence of a substantial number of deteriorated or deteriorating structures, predominance of defective or inadequate street layout, faulty lot layout in relation to size, adequacy, accessibility or usefulness, insanitary or unsafe conditions, deterioration of site or other improvements, diversity of ownership, tax or special assessment delinquency exceeding the fair value of the land, defective or unusual conditions of title, improper subdivisions or lack of adequate housing facilities in the area or obsolete or impractical planning and platting or an area where a significant number of commercial or mercantile businesses have closed or significantly reduced their operations due to the economic losses or loss of profit due to operating in the area, low levels of commercial or industrial activity or redevelopment or any combination of such factors that substantially impairs or arrests the sound growth and economic health and well-being of a municipality or locale within a municipality or an area that retards the provisions of housing accommodations or constitutes an economic or social burden and is a menace to the public health, safety, morals or welfare in its present condition and use;

B. "department" means the taxation and revenue department, the secretary of taxation and revenue or any employee of the department exercising authority lawfully delegated to that employee by the secretary;

C. "district" means a metropolitan redevelopment district formed pursuant to the Metropolitan Redevelopment Tax Act;

D. "district board" means the board of directors of a district;

E. "governing body" means the board or body in which the legislative powers of a municipality are vested;

F. "metropolitan redevelopment project" means an activity or undertaking designed to eliminate a slum area or a blighted area;

G. "municipality" means any incorporated city, town or village, whether incorporated under general act, special act or special charter, and an H-class county; and

H. "slum area" means an area within the area of operation in which numerous buildings, improvements and structures, whether residential or nonresidential, which, by reason of its dilapidation, deterioration, age, obsolescence or inadequate provision for ventilation, light, air, sanitation or open spaces, high density of population, overcrowding or the existence of conditions that endanger life or property by fire or other causes, is conducive to ill health, transmission of disease, infant mortality, juvenile delinquency or crime and is detrimental to the public health, safety, morals and welfare.

Section 9. [NEW MATERIAL] RESOLUTION DECLARING INTENTION TO FORM DISTRICT.--

A. If the public convenience and necessity require, and on presentation of a petition signed by at least twenty-five percent of the voters proposed to be included in a district that may be referred to as a "metropolitan redevelopment district", the governing body of a municipality may adopt a resolution declaring its intention to finance a metropolitan redevelopment project within the municipality and to form a district that would be subject to the tax increment procedures set forth in the Metropolitan Redevelopment Tax Act for the purpose of financing that metropolitan redevelopment project. The resolution shall also state the municipality's intention to include in the district contiguous or noncontiguous property within an area in which the metropolitan redevelopment project proposed to be financed is located. A district shall be wholly within the corporate boundaries of the municipality. If the governing body fails to act within ninety days following presentation of a petition to create a district, the petition shall be deemed to have been accepted by the governing body, which shall adopt a resolution and hold a public hearing pursuant to this section. The resolution shall state:

(1) the area to be included within a district;

(2) a description of the metropolitan redevelopment project for which the district is proposed for formation and to which tax increment procedures pursuant to the Metropolitan Redevelopment Tax Act are proposed to be applied;

(3) a general description of the tax increment procedures that will be used to finance the metropolitan redevelopment project for which a district is formed;

(4) a general plan for the district that is on file with the clerk that includes a map depicting the boundaries of the district;

(5) a notice of public hearing in conformity with the requirements of the Metropolitan Redevelopment Tax Act;

(6) the place where written objections to the formation of the district may be filed by the owner;

(7) that formation of the district may result in the use of tax increment procedures pursuant to the Metropolitan Redevelopment Tax Act for the financing of the metropolitan redevelopment projects; and

(8) whether the district will be governed by a district board comprised of the members of the governing body, ex officio, or comprised of five directors initially appointed by the governing body.

B. The resolution shall direct that a hearing on formation of the district be scheduled and the notice be mailed and published as provided in the Metropolitan Redevelopment Tax Act.

C. Before adopting a resolution pursuant to this section, a general plan for the metropolitan redevelopment project for which the formation of a district is proposed shall be filed with the clerk of the municipality.

Section 10. [NEW MATERIAL] NOTICE AND PUBLIC HEARING.--

A. The notice of public hearing to be held concerning the formation of a district pursuant to the Metropolitan Redevelopment Tax Act shall be mailed by registered or certified United States mail, postage prepaid, to all registered voters in the proposed district at least thirty days prior to the date of the hearing. In addition, notice shall be published once each week for two successive weeks in a newspaper of general circulation in the municipality in which the proposed district lies. The last publication shall be at least three days before the date of the hearing. The notice shall comply with requirements of Subsections B and C of this section.

B. The municipal clerk shall execute a notice, which shall read substantially as follows:

"To whom it may concern:

The governing body of the (municipality) of _____________, on (Date), adopted the attached resolution declaring its intention to form a metropolitan redevelopment district subject to gross receipts tax increment financing procedures for the purpose of financing a metropolitan redevelopment project. A hearing on formation will be held on (Date), at (Time) at (Location).".

C. A summary of the resolution declaring the governing body's intention to form the district shall be attached to the notice, and the municipal clerk shall cause a copy to be mailed to the registered voters in the district and to all other persons who have filed a written request for a copy of the notice within the six months preceding or at any time following the adoption of the resolution of intent to form the district. The municipal clerk shall also publish a copy of the notice and resolution summary at least twice in a newspaper of general circulation in the municipality in which the proposed district lies. The clerk shall execute an affidavit of mailing stating the date of mailing and the names and addresses of the persons to whom the notices and copies of the resolutions were mailed. The clerk shall obtain an affidavit from the newspaper in which the publication was made. The clerk shall cause both affidavits to be placed in the official records of the municipality. The affidavits are conclusive evidence of the mailing and publishing of notice. Notice shall not be held invalid for failure of delivery to the addressee.

Section 11. [NEW MATERIAL] ORDER FORMING DISTRICT--ELECTION.--

A. The governing body shall determine during July of a calendar year whether the district should be formed based upon the interests, convenience or necessity of the residents of the district and the municipality in which the proposed district would be located. If the governing body determines that the district should be formed, it shall adopt a resolution ordering that the district be formed and then ordering that an election be held on the question whether to form the district. A resolution ordering a formation of the district shall state that the district will be governed by a district board consisting of members of the governing body, ex officio, or, upon determination of the governing body, five directors appointed by the governing body, and shall contain the names of the five initial directors and the terms of office of each. If the governing body appoints a district board, it shall appoint a treasurer and a clerk from the appointed members.

B. The conduct of a formation election shall meet the requirements of the Metropolitan Redevelopment Tax Act.

Section 12. [NEW MATERIAL] NOTICE AND CONDUCT OF ELECTION.--

A. An election for a formation of a district pursuant to the Metropolitan Redevelopment Tax Act shall be a nonpartisan election called by posting notices in three public places within the boundaries of the district not less than twenty days before the election. Notice shall also be published in a newspaper of general circulation in the municipality, or, if there is no newspaper so circulated in the municipality, in a newspaper of general circulation in the county in which the municipality is located once a week for two consecutive weeks before the election. The notice shall state:

(1) the place of holding the election and provisions for voting by mail, if any;

(2) the hours during the day, not less than six, in which the polls will be open;

(3) the boundaries of the proposed district; and

(4) that a general plan is on file with the municipal clerk.

B. The governing body shall determine the date of the election and the polling places for the election. The governing body may establish provisions for voting by mail.

C. Voter lists shall be used to determine the qualified voters in a district.

D. Except as otherwise provided by this section, the election shall comply with the general election laws of this state. The ballot material provided to each voter shall include:

(1) an impartial description of the metropolitan redevelopment project contemplated within the proposed district and a brief description of arguments for and against the formation of the district, if any; and

(2) the ballot, which shall pose the question to be voted upon as "metropolitan redevelopment district, yes" and "metropolitan redevelopment district, no".

E. The governing body may provide for the returns of the election to be made in person or by mail.

F. Within thirty days after an election, the governing body shall meet and canvass the returns, determining the number of votes properly cast for and against the question. At least a three-fourths' majority of the votes cast at the election shall be required for formation of the district. The canvass may be continued for an additional period not to exceed thirty days at the election of the governing body for the purpose of completing the canvass. Failure of a majority to vote in favor of the matter submitted shall not prejudice the submission of the same or similar matters at a later election.

Section 13. [NEW MATERIAL] FORMATION.--

A. If the formation of the district is approved by at least a three-fourths' majority of the votes cast at the election, the governing body shall cause a copy of the resolution ordering formation of the district to be delivered to the department and the local government division of the department of finance and administration.

B. Except as otherwise provided in this section, a district shall be a political subdivision of the state, separate and apart from the municipality.

C. Following formation of the district, the district board shall administer in a reasonable manner the implementation of the general plan for the metropolitan redevelopment project of the district.

Section 14. [NEW MATERIAL] APPOINTMENT OF DIRECTORS--QUALIFICATIONS--TERMS--RESUMPTION OF GOVERNANCE BY GOVERNING BODY.--

A. The governing body, at its option, may authorize the appointment of a separate district board. In the case of an appointed district board, three of the appointed directors shall serve an initial term of six years. Two of the appointed directors shall serve an initial term of four years. The resolution forming the district shall state which directors shall serve four-year terms and which shall serve six-year terms. If a vacancy occurs on the district board because of death, resignation or inability of the director to discharge the duties of director, the governing body shall appoint a director to fill the vacancy, who shall hold office for the remainder of the unexpired term until his successor is appointed or elected.

B. A director may be a director of more than one district.

C. At the end of the appointed directors' initial term, the governing body shall resume governance of the district as its board or, at its option, shall hold an election of new directors by majority vote of the residents of the district.

Section 15. [NEW MATERIAL] POWERS OF A DISTRICT.--

A. In addition to the powers otherwise granted to a district pursuant to the Metropolitan Redevelopment Tax Act, the district board, in implementing a general plan pursuant to that act, may:

(1) enter into contracts and expend money for a metropolitan redevelopment project within the district;

(2) enter into development agreements with municipalities, counties or other local government entities in connection with property located within the boundaries of the district;

(3) enter into intergovernmental agreements as provided in the Joint Powers Agreements Act for the planning, design, inspection, ownership, control, maintenance, operation or repair of infrastructure for a metropolitan redevelopment project or the provision of enhanced services by the municipality in the district and any other purpose authorized by the Metropolitan Redevelopment Tax Act;

(4) sell, lease or otherwise dispose of district property if the sale, lease or conveyance is not a violation of the terms of any contract or bond covenant of the district;

(5) reimburse the municipality in which the district is located for providing enhanced services in the district;

(6) employ staff, counsel and consultants;

(7) reimburse the municipality in which the district is located for staff and consultant services and support facilities supplied by the municipality;

(8) accept gifts or grants and incur and repay loans for a metropolitan redevelopment project;

(9) pay the financial, legal and administrative costs of the district; and

(10) use public easements and rights of way in or across public property, roadways, highways, streets or other thoroughfares and other public easements and rights of way, whether in or out of the geographical limits of the district or the municipality.

B. Notwithstanding the provisions of the Procurement Code, or local procurement requirements that may otherwise be applicable to the municipality in which the district is located, the district board, whether appointed or composed of members of the governing body, ex officio, may enter into contracts to carry out any of the district's authorized powers with a contractor or other person or entity, on such terms and with such persons as the district board determines to be appropriate.

Section 16. [NEW MATERIAL] RECORDS--BOARD OF DIRECTORS--OPEN MEETINGS.--

A. The district shall keep the following records, which shall be open to public inspection:

(1) minutes of all meetings of the district board;

(2) all resolutions;

(3) accounts showing all money received and disbursed;

(4) the annual budget; and

(5) all other records required to be maintained by law.

B. The district board shall appoint a clerk and treasurer for the district.

Section 17. [NEW MATERIAL] OTHER DISTRICTS.--The formation of a district pursuant to the Metropolitan Redevelopment Tax Act shall not prevent the subsequent establishment of similar districts.

Section 18. [NEW MATERIAL] RECORDING DOCUMENTS.--The district shall file and record with the county clerk the resolution ordering formation of the district, the general plan of the district and the canvass of any general obligation bond election.

Section 19. [NEW MATERIAL] DISSOLUTION OF DISTRICT.--The district shall be dissolved by the district board by a resolution of the district board upon a determination that each of the following conditions exist:

A. the metropolitan redevelopment project for which the district was formed is complete or provision has been made for metropolitan redevelopment projects to be conveyed to the municipality in which the district is located;

B. the municipality has no outstanding bond obligations issued to finance a metropolitan redevelopment project in the district; and

C. all obligations of the district pursuant to any development agreement with the municipality have been satisfied.

Section 20. [NEW MATERIAL] LIMITATION OF LIABILITY.--Neither any member of the board of directors of a district nor any person acting on behalf of the district, while acting within the scope of that person's authority, shall be subject to any personal liability for any action taken or omitted within that scope of authority.

Section 21. [NEW MATERIAL] CUMULATIVE AUTHORITY.--The Metropolitan Redevelopment Tax Act shall be regarded as supplemental and additional to powers conferred by other laws and shall not be regarded as in derogation of any existing powers.

Section 22. [NEW MATERIAL] ALTERNATIVE METHOD OF FINANCING.--

A. Effective for tax years beginning on or after January 1, 2006, the governing body may elect by ordinance to use the procedures set forth in the Metropolitan Redevelopment Tax Act for financing metropolitan redevelopment projects within districts within a municipality. Those procedures may be used in addition to, or in conjunction with, other methods provided by law for financing such projects.

B. The tax increment method, for the purpose of financing metropolitan redevelopment projects, is the dedication for further use in metropolitan redevelopment projects of the increase in revenues to municipalities from the imposition of local option gross receipts taxes in districts within those municipalities and from distributions to those municipalities pursuant to Section 7-1-6.46 NMSA 1978 attributable to state gross receipts taxes collected within those districts.

Section 23. [NEW MATERIAL] TAX INCREMENT PROCEDURES.--After the last day of the calendar year during which a municipality issues bonds for a metropolitan redevelopment project, and upon request by a municipality, the department shall certify to the municipality as a base revenue value the amount of gross receipts taxes that the department collected on behalf of the municipality pursuant to the Municipal Local Option Gross Receipts Taxes Act within a district during the calendar year preceding the issuance of bonds for the metropolitan redevelopment project and the amount distributed during the calendar year to the municipality pursuant to Section 7-1-6.46 NMSA 1978 attributable to state gross receipts taxes collected within that district. All applicable municipal gross receipts tax rates imposed pursuant to the Municipal Local Option Gross Receipts Taxes Act shall then be applied to the gross receipts that the department determines are collected in the district during the calendar year in which bonds are issued pursuant to the Metropolitan Redevelopment Tax Act, and that amount shall be added to the amount distributed to the municipality during that calendar year pursuant to Section 7-1-6.46 NMSA 1978, which is attributable to gross receipts collected within the same district. The amount by which that sum exceeds the base revenue value shall be credited to the district and deposited in the district redevelopment fund.

Section 24. [NEW MATERIAL] DISTRICT REDEVELOPMENT FUND.--The "district redevelopment fund" is created in the state treasury. The fund shall consist of money deposited into the fund pursuant to the Metropolitan Redevelopment Tax Act. An amount equal to the amount of money in the fund credited to a district pursuant to the Metropolitan Redevelopment Tax Act shall be appropriated to the district for the metropolitan redevelopment project for which the district is formed. Disbursements from the fund shall be by warrant of the secretary of finance and administration upon vouchers signed by a director serving on the district board of that district. Money in the fund shall not revert to the general fund at the end of a fiscal year.

Section 25. [NEW MATERIAL] MUNICIPAL GROSS RECEIPTS TAX INCREMENT BONDS--AUTHORITY TO ISSUE--PLEDGE OF REVENUES.--

A. For the purpose of financing a metropolitan redevelopment project, in whole or in part, for a district within a municipality, that municipality may issue bonds, to be known as "municipal gross receipts tax increment bonds", that are payable from and secured by gross receipts taxes credited to a district within that municipality and deposited in the district redevelopment fund pursuant to the Metropolitan Redevelopment Tax Act. The principal of, premium, if any, and interest on the bonds shall be payable from and secured by a pledge of those revenues, and the municipality shall irrevocably pledge all or part of those revenues to the payment of the bonds. The revenues deposited in the district redevelopment fund or the designated part thereof may be used only for the payment of the principal of, premium, if any, and interest on the bonds, and a holder of the bonds shall have a lien against the revenues deposited in the district redevelopment fund or the designated part thereof for the payment of the principal of, premium, if any, and interest on such bonds. If the issuance of bonds pursuant to the Metropolitan Redevelopment Tax Act impairs the ability of a municipality to meet its principal or interest payment obligations for revenue bonds outstanding prior to July 1, 2005 that are secured by the pledge of all or part of the municipality's revenue from the distribution made to the municipality pursuant to Section 7-1-6.4 NMSA 1978, the amount distributed to the municipality pursuant to that section shall be increased by an amount sufficient to meet any required payment.

B. Bonds issued pursuant to this section shall not constitute an indebtedness within the meaning of any constitutional or statutory debt limitation or restriction, shall not be general obligations of the municipality, shall be collectible only from the proper pledged revenues and shall not be subject to the provisions of any other law or charter relating to the authorization, issuance or sale of tax increment bonds or tax increment bond anticipation notes. Bonds issued pursuant to the Metropolitan Redevelopment Tax Act are declared to be issued for an essential public and governmental purpose and, together with interest thereon, shall be exempted from all taxes by the state.

C. The bonds shall be authorized by an ordinance of the municipality shall be in such denominations, bear such date and mature, at a time not exceeding twenty years from their date, bear interest at a rate or have appreciated principal value not exceeding the maximum net effective interest rate permitted by the Public Securities Act and be in such form, carry registration privileges, be executed in such manner, be payable in such place within or without the state, be payable at intervals or at maturity and be subject to such terms of redemption as the authorizing ordinance or supplemental ordinance or supplemental resolution of the municipality may provide.

D. The bonds or notes may be sold in one or more series at, below or above par, at public or private sale, in such manner and for such price as the municipality, in its discretion, shall determine; provided that the price at which the bonds or notes are sold shall not result in a net effective interest rate that exceeds the maximum permitted by the Public Securities Act. As an incidental expense of a metropolitan redevelopment project or portion of that project financed with the bonds, the municipality may employ financial and legal consultants with regard to financing the project.

E. In case any of the public officials of the municipality whose signatures appear on any bonds issued pursuant to the Metropolitan Redevelopment Tax Act shall cease to be public officials before the delivery of the bonds or notes, the signatures shall be valid and sufficient for all purposes, the same as if the officials had remained in office until delivery. Any provision of law to the contrary notwithstanding, any bonds issued pursuant to the Metropolitan Redevelopment Tax Act shall be fully negotiable.

F. In any suit, action or proceeding involving the validity or enforceability of any bond issued pursuant to the Metropolitan Redevelopment Tax Act, any bond reciting in substance that it has been issued by the municipality in connection with a metropolitan redevelopment project shall be conclusively deemed to have been issued for that purpose.

G. The proceedings under which bonds are authorized to be issued and any mortgage, deed of trust, trust indenture or other lien or security device on real and personal property given to secure the lien or security device may contain provisions customarily contained in instruments securing bonds and notes and constituting a covenant with the bondholders.

H. The municipality shall have the power to issue renewal notes, to issue bonds and, whenever it deems refunding expedient, to refund any bonds by the issuance of new bonds, whether the bonds to be refunded have or have not matured, and to issue bonds partly to refund bonds then outstanding and partly for other purposes in connection with financing metropolitan redevelopment projects, in whole or in part. Refunding bonds issued pursuant to the Metropolitan Redevelopment Tax Act to refund outstanding tax increment bonds shall be payable from gross receipts tax revenues, out of which the bonds to be refunded thereby are payable from other lawfully available revenues.

I. The proceeds from the sale of any municipal tax increment bonds shall be applied only for the purpose for which the bonds or notes were issued and if, for any reason, any portion of the proceeds are not needed for the purpose for which the bonds were issued, the unneeded portion of the proceeds shall be applied to the payment of the principal or the interest on the bonds or notes.

J. The cost of financing a metropolitan redevelopment project includes the actual cost of acquiring a site and the cost of the construction of any part of the metropolitan redevelopment project, including architects' and engineers' fees, the purchase price of any part of that project that may be acquired by purchase and all expenses in connection with the authorization, sale and issuance of the bonds or notes to finance the acquisition, and any related costs incurred by the municipality.

Section 26. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2005.

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