AN ACT
RELATING TO FINANCE; AUTHORIZING MUNICIPALITIES TO IMPOSE FEES FOR USE OF A MUNICIPAL EVENT CENTER AND TO IMPOSE A SURCHARGE ON REVENUES ARISING FROM ACTIVITIES AT A MUNICIPAL EVENT CENTER; PERMITTING MUNICIPALITIES TO ISSUE REVENUE BONDS; PROVIDING LEGAL REMEDIES; CREATING AN EXEMPTION FROM THE GOVERNMENTAL GROSS RECEIPTS TAX FOR MUNICIPAL EVENT CENTER RECEIPTS; ENACTING A NEW SECTION OF THE GROSS RECEIPTS AND COMPENSATING TAX ACT; ENACTING THE MUNICIPAL EVENT CENTER FUNDING ACT; PROVIDING DISTRIBUTIONS; MAKING AN APPROPRIATION; DECLARING AN EMERGENCY.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
Section 1. A new section of the Tax Administration Act is enacted to read:
"DISTRIBUTION--MUNICIPAL EVENT CENTER SURCHARGE.--
A. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the public project revolving fund administered by the New Mexico finance authority in an amount equal to seventy-five percent of the amount of event center surcharge proceeds transferred to the tax administration suspense fund pursuant to the Municipal Event Center Funding Act.
B. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the energy, minerals and natural resources department in an amount equal to twenty-four percent of the amount of event center surcharge proceeds transferred to the tax administration suspense fund pursuant to the Municipal Event Center Funding Act.
C. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the cultural affairs department in an amount equal to one percent of the amount of event center surcharge proceeds transferred to the tax administration suspense fund pursuant to the Municipal Event Center Funding Act."
Section 2. A new section of the Gross Receipts and Compensating Tax Act is enacted to read:
"EXEMPTION--GROSS RECEIPTS TAX AND GOVERNMENTAL GROSS RECEIPTS TAX--EVENT CENTER SURCHARGE.--Exempted from the gross receipts tax and from the governmental gross receipts tax are the receipts from selling tickets, parking, souvenirs, concessions, programs, advertising, merchandise, corporate suites or boxes, broadcast revenues and all other products or services sold at or related to a municipal event center or related to activities occurring at the event center on which an event center surcharge is imposed pursuant to the Municipal Event Center Funding Act."
Section 3. SHORT TITLE.--Sections 3 through 11 of this act may be cited as the "Municipal Event Center Funding Act".
Section 4. FINDINGS AND PURPOSE.--
A. The legislature finds that:
(1) the costs of acquiring land for and of designing, purchasing, constructing, remodeling, rehabilitating, renovating, improving, equipping, furnishing, operating and maintaining municipal event centers have increased to a level that local financial resources are inadequate to meet all of the costs;
(2) functional and modern municipal event centers are essential in retaining and attracting cultural, educational, entertainment and sporting events to municipalities and the state and are essential for the economic development and prosperity of municipalities and the state; and
(3) even after using local financial resources, municipalities need additional means to provide complete funding for functional and modern municipal event centers.
B. The purpose of the Municipal Event Center Funding Act is to provide an additional method of accessing the capital markets to meet the need for a complete funding package for functional and modern municipal event centers.
Section 5. DEFINITIONS.--As used in the Municipal Event Center Funding Act:
A. "bonds" means revenue bonds issued by a municipality to pay for some or all of the costs of acquiring land for and designing, purchasing, constructing, remodeling, rehabilitating, renovating, improving, equipping and furnishing a municipal event center;
B. "chief executive officer" means the mayor or chief administrative officer of a municipality when designated in writing by the mayor to perform duties required by the Municipal Event Center Funding Act;
C. "debt service payments" means rentals, receipts, fees or other charges paid to a municipality for the rights to use, operate or manage a municipal event center by any person, corporation or other entity;
D. "event center revenues" means rentals, receipts, fees or other charges imposed by and paid to a municipality pursuant to the Municipal Event Center Funding Act for the rights to use, operate or manage a municipal event center by any person, corporation or other entity;
E. "event center surcharge" means a surcharge to be included in each vendor contract on tickets, parking, souvenirs, concessions, programs, advertising, merchandise, corporate suites or boxes, broadcast revenues and all other products or services sold at or related to the municipal event center or related to activities occurring at the event center;
F. "governing body" means the council, commission or other group of elected officials of a municipality in which is vested the legislative authority of a municipality;
G. "municipal event center" means an event center providing seating for a minimum of four thousand people, including land, buildings and related improvements, primarily designed and intended for cultural, educational, entertainment and sporting events, but does not include a civic or convention center;
H. "municipality" means a political subdivision of the state, organized and operating under a home-rule charter or the Municipal Code;
I. "vendor" means every person, corporation, partnership or other entity, including a division or department of a municipality, providing products or services sold at or related to the municipal event center; and
J. "vendor contract" means a contract, agreement or other written arrangement between a municipality and a vendor pursuant to which the vendor provides products or services sold at or related to the municipal event center.
Section 6. AUTHORIZATION OF SURCHARGE AND OTHER FEES--USE OF PROCEEDS--TRANSFER.--
A. A municipality in which a municipal event center is located may establish by ordinance an event center surcharge of not less than five percent of each vendor contract entered into by that municipality. As otherwise established by that municipality, the event center surcharge may be any percentage greater than five percent of each vendor contract entered into by the municipality.
B. A municipality shall include an event center surcharge in the terms of each vendor contract into which it enters. A chief executive officer of a municipality shall sign each vendor contract into which that municipality enters.
C. A municipality may establish charges and fees deemed necessary by the governing body or the chief executive officer for the use, operation or management of a municipal event center by a person, corporation or other entity.
D. From the proceeds of the event center surcharge, an amount equal to two percent of each vendor contract entered into by the municipality shall be transferred monthly by the municipality that established the event center surcharge to the tax administration suspense fund.
E. A municipality shall establish a fund for construction, renovation, operation, equipment, maintenance and improvement of a municipal event center for deposit of all event center revenues and event center surcharge proceeds that exceed the required debt service payments, except for event center surcharge proceeds transferred to the tax administration suspense fund pursuant to this section. Money in the fund may be used to pay:
(1) debt service payments;
(2) costs of operating a municipal event center during the life of the bonds issued by the municipality pursuant to the Municipal Event Center Funding Act;
(3) costs of constructing, renovating, equipping, maintaining or improving that municipal event center; or
(4) costs of collecting or administering the event center surcharge.
Section 7. COLLECTION OF EVENT CENTER SURCHARGE--REMITTANCE TO MUNICIPALITY.--
A. Upon the sale of a product or service subject to the event center surcharge, a vendor shall collect the event center surcharge from the purchaser of that product or service on behalf of the municipality and shall act as a trustee for the surcharge receipts. A purchaser of a product or service subject to the event center surcharge shall be charged separately for the event center surcharge from the cost of the product or service, or the vendor shall institute accounting controls or procedures sufficient to identify the amount of the surcharge owed to a municipality for each sale, transaction or exchange subject to the surcharge. Receipts from the event center surcharge shall be remitted by a vendor to the treasurer of the municipality in which the municipal event center at which the vendor sold the product or service is located no later than the tenth day of the month following the collection of the surcharge.
B. A treasurer of a municipality shall deposit municipal event center revenues and event center surcharge receipts in a separate account and act as trustee of the revenue on behalf of bondholders pursuant to the Municipal Event Center Funding Act so long as any bonds remain outstanding.
Section 8. AUDITS.--A municipality shall provide by ordinance a method to audit or otherwise ensure that vendors subject to the event center surcharge collect and remit to the treasurer of the municipality the full amount of the surcharge receipts due to the municipality.
Section 9. ENFORCEMENT--PENALTIES.--
A. An action to enforce the imposition and collection of an event center surcharge by a vendor may be brought by a municipality.
B. A district court may issue an appropriate judgment, order or remedy to enforce the provisions of a vendor contract.
C. A judgment issued by a district court requiring event center surcharge receipts to be paid to a municipal treasurer by a vendor shall also award interest at an annual rate of twelve percent on past due amounts, attorney fees and costs to a municipality.
Section 10. ISSUANCE OF BONDS.--
A. A municipality may issue revenue bonds, in accordance with the procedures set forth in Sections 3-31-3 through 3-31-7 NMSA 1978, to acquire land for and to design, purchase, construct, remodel, renovate, rehabilitate, improve, equip or furnish a municipal event center.
B. Revenue bonds issued by a municipality may be secured by event center revenues, event center surcharge receipts or gross receipts tax revenues distributed to that municipality pursuant to Section 7-1-6.4 or 7-1-6.12 NMSA 1978.
C. An action shall not be brought questioning the legality of the pledge of event center revenues, event center surcharge receipts or gross receipts tax revenues, bonds issued pursuant to the Municipal Event Center Funding Act, issuance of those bonds, an event center surcharge included in a vendor contract or any other matter concerning the bonds after thirty days from the date of publication of the ordinance authorizing issuance of the bonds and the pledging of event center receipts, event center surcharge receipts or gross receipts tax revenues of a municipality to make debt service payments.
D. The legislature or a municipality shall not repeal, amend or otherwise modify any law or ordinance that adversely affects or impairs the event center surcharge or any bonds secured by a pledge of the event center revenues, event center surcharge receipts or gross receipts tax revenues, unless the bonds have been paid in full or provisions have been made for full payment.
Section 11. CUMULATIVE AND COMPLETE AUTHORITY.--The Municipal Event Center Funding Act shall be deemed to provide an additional and alternative method for obtaining funding for a municipal event center, establishing and collecting event center revenues and the event center surcharge and completing the acts authorized pursuant to that act, and shall be regarded as supplemental and additional to powers conferred by other laws of the state and shall constitute full authority for the exercise of powers granted pursuant to the Municipal Event Center Funding Act.
Section 12. LIBERAL INTERPRETATION.--The Municipal Event Center Funding Act shall be liberally construed to carry out its purpose.
Section 13. SEVERABILITY.--If any part or application of the Municipal Event Center Funding Act is held invalid, the remainder or its application to other situations or persons shall not be affected.
Section 14. EMERGENCY.--It is necessary for the public peace, health and safety that this act take effect immediately.