A JOINT RESOLUTION

PROPOSING TO AMEND THE CONSTITUTION OF NEW MEXICO TO ALLOW THE STATE AND SCHOOL DISTRICTS, INCLUDING CHARTER SCHOOLS, TO ENTER INTO AGREEMENTS FOR THE LEASING OF BUILDINGS AND OTHER REAL PROPERTY WITH AN OPTION TO PURCHASE.

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

     Section 1. It is proposed to amend Article 9, Section 8 of the constitution of New Mexico to read:

          "A. No debt other than those specified in the preceding section shall be contracted by or on behalf of this state, unless authorized by law for some specified work or object; which law shall provide for an annual tax levy sufficient to pay the interest and to provide a sinking fund to pay the principal of such debt within fifty years from the time of the contracting thereof. No such law shall take effect until it shall have been submitted to the qualified electors of the state and have received a majority of all the votes cast thereon at a general election; such law shall be published in full in at least one newspaper in each county of the state, if one be published therein, once each week, for four successive weeks next preceding such election. No debt shall be so created if the total indebtedness of the state, exclusive of the debts of the territory, and the several counties thereof, assumed by the state, would thereby be made to exceed one percent of the assessed valuation of all the property subject to taxation in the state as shown by the preceding general assessment.

          B. For the purposes of this section and Article 4, Section 29 of the constitution of New Mexico, a financing agreement entered into by the state for the leasing of a building or other real property with an option to purchase for a price that is reduced according to the payments made by the state pursuant to the financing agreement is not a debt if:

                (1) there is no legal obligation for the state to continue the lease from year to year or to purchase the real property; and

                (2) the agreement provides that the lease shall be terminated if sufficient appropriations are not available to meet the current lease payments."

     Section 2. It is proposed to amend Article 9, Section 11 of the constitution of New Mexico to read:

          "A. Except as provided in Subsection C of this section, no school district shall borrow money except for the purpose of erecting, remodeling, making additions to and furnishing school buildings or purchasing or improving school grounds or any combination of these purposes, and in such cases only when the proposition to create the debt has been submitted to a vote of such qualified electors of the district as are owners of real estate within the school district and a majority of those voting on the question has voted in favor of creating such debt.

          B. No school district shall ever become indebted in an amount exceeding six percent on the assessed valuation of the taxable property within the school district as shown by the preceding general assessment.

          C. A school district may create a debt by entering into a lease-purchase arrangement to acquire education technology equipment without submitting the proposition to a vote of the qualified electors of the district, but any debt created is subject to the limitation of Subsection B of this section.

          D. For the purposes of this section, a financing agreement entered into by a school district or a charter school for the leasing of a building or other real property with an option to purchase for a price that is reduced according to the payments made by the school district or charter school pursuant to the financing agreement is not a debt if:

                (1) there is no legal obligation for the school district or charter school to continue the lease from year to year or to purchase the real property; and

                (2) the agreement provides that the lease shall be terminated if sufficient money is not available to meet the current lease payments."

     Section 3. The amendment proposed by this resolution shall be submitted to the people for their approval or rejection at the next general election or at any special election prior to that date that may be called for that purpose.