House Bill text for HB0262

HOUSE BILL 262

48th legislature - STATE OF NEW MEXICO - second session, 2008

INTRODUCED BY

John A. Heaton

AN ACT

RELATING TO ECONOMIC DEVELOPMENT; ENACTING THE NEW MEXICO RESEARCH APPLICATIONS ACT; PROVIDING FOR A NONPROFIT CORPORATION TO INTERACT WITH BUSINESS AND GOVERNMENT ENTITIES, UNIVERSITIES, PRIVATE FOUNDATIONS AND NATIONAL LABORATORIES FOR THE PURPOSE OF FOSTERING ECONOMIC DEVELOPMENT IN THE AREAS OF TECHNOLOGY AND INTELLECTUAL PROPERTY; DECLARING AN EMERGENCY.

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

Section 1. [NEW MATERIAL] SHORT TITLE.--Sections 1 through 17 of this act may be cited as the "New Mexico Research Applications Act".

Section 2. [NEW MATERIAL] PURPOSES.--The purposes of the New Mexico Research Applications Act are to:

A. promote the public welfare and prosperity of the people of New Mexico;

B. foster economic development in the area of intellectual property within New Mexico;

C. attract investments that will drive technological innovations in New Mexico;

D. create high-value technology jobs in New Mexico with appropriately trained employees to fill such jobs;

E. forge links, critical partnerships and collaboration among New Mexico's business communities, universities, private foundations, national laboratories and government through the development of a research applications center;

F. support educational initiatives in science, technology, engineering and mathematics in the state to ensure the availability of the future workforce required to meet the goals of the New Mexico Research Applications Act; and

G. engage in cooperative ventures related to the use of research and development applications, including the use of research and development applications as a means of enhancing state and local resource development and promoting innovative technological advances in the areas of economic, community and workforce development; education; science; technology; engineering; mathematics; research and development; conservation; and health care, within New Mexico.

Section 3. [NEW MATERIAL] DEFINITIONS.--As used in the New Mexico Research Applications Act:

A. "board" means the board of directors of the research applications center;

B. "bond" means a bond, note or other evidence of indebtedness issued by the research applications center;

C. "department" means the economic development department;

D. "research applications center" means the nonprofit corporation created pursuant to the Nonprofit Corporation Act and the New Mexico Research Applications Act;

E. "technological innovations" includes research, development, prototype assembly, manufacturing, patenting, licensing, marketing and sale of inventions, ideas, practices, applications, processes, machines and technology and related property rights of all kinds; and

F. "university" means:

(1) a New Mexico educational institution named in Article 12, Section 11 of the constitution of New Mexico;

(2) a community college organized pursuant to the Community College Act; or

(3) a technical and vocational institute organized pursuant to the Technical and Vocational Institute Act.

Section 4. [NEW MATERIAL] RESEARCH APPLICATIONS CENTER--FORMATION--BOARD OF DIRECTORS.--

A. The department shall, pursuant to the Nonprofit Corporation Act, incorporate a corporation with the name "New Mexico research applications center"; provided that, if that name is not available, the department shall select another name that reflects the purposes of the New Mexico Research Applications Act.

B. The articles of incorporation shall include:

(1) provisions for appointing the board pursuant to Subsection C of this section;

(2) provisions requiring that board vacancies shall be filled by the governor;

(3) a statement that the corporation will have no members;

(4) provisions that prohibit any board action inconsistent with the New Mexico Research Applications Act;

(5) provisions that prohibit the board from increasing the number of directors;

(6) a plan of distribution of the assets remaining after dissolution or final liquidation of the corporation. The plan shall require that, after all liabilities and obligations are paid, all funds of the corporation shall be deposited in the general fund and all other assets shall be distributed to the department of finance and administration; and

(7) any other provisions deemed necessary by the department to ensure compliance with the New Mexico Research Applications Act.

C. The board of directors shall be appointed by the governor. The board shall include representatives with relevant experience from state government, local governments, businesses located in New Mexico, universities, private foundations, national laboratories and investment advisors. The board shall be appointed in a manner that reflects the geographic, cultural and ethnic diversity of this state.

Section 5. [NEW MATERIAL] RESEARCH APPLICATIONS CENTER--POWERS.--As directed by the board, the research applications center may:

A. acquire, by lease or purchase, the land, buildings, facilities, improvements and equipment necessary to achieve the purposes of the New Mexico Research Applications Act;

B. lease to any person any part or all of the land, buildings, facilities, improvements and equipment acquired pursuant to Subsection A of this section;

C. enter into contracts, joint powers agreements, memoranda of understanding and other agreements with public and private entities in order to carry out the purposes of the New Mexico Research Applications Act;

D. enter into business arrangements for technological innovations with one or more business entities, governmental entities, universities, private foundations, national laboratories or other persons;

E. independently, or in conjunction with another person, form corporations pursuant to the Nonprofit Corporation Act or the Business Corporation Act for technological innovations purposes;

F. otherwise conduct, sponsor, finance and contract as necessary to further technological innovations;

G. purchase, take, receive or otherwise acquire; own; hold; dispose of; use; or otherwise deal in and with property, including an interest in or ownership of intangible personal property, intellectual property or technological innovations;

H. sell, convey, pledge, exchange, transfer or otherwise dispose of its assets and properties for consideration upon terms and conditions that the board shall determine;

I. issue bonds pursuant to the New Mexico Research Applications Act or otherwise incur liabilities or borrow money at rates of interest that the board may determine;

J. receive and administer grants, contracts and private gifts;

K. invest and reinvest its funds;

L. employ officers and employees that it deems necessary, set their compensation and prescribe their duties;

M. enter into agreements with insurance carriers to insure against any loss in connection with its operations;

N. authorize retirement programs and other benefits for salaried officers and employees;

O. enter into license agreements and contracts involving intellectual property and technological innovations, including agreements for patents, copyrights, franchises and trademarks; and

P. do anything else the board deems appropriate to further the purposes of the New Mexico Research Applications Act either directly or indirectly.

Section 6. [NEW MATERIAL] APPLICABILITY OF OTHER LAWS.--

A. Except as otherwise provided in the New Mexico Research Applications Act, the research applications center shall not be deemed to be the state, or one of its agencies, instrumentalities, institutions or political subdivisions for the purpose of applying any other laws, including those relating to personnel, procurement of goods and services, meetings of the board, gross receipts taxes, disposition or acquisition of property, capital outlays, per diem and mileage and inspection of records.

B. The research applications center shall be deemed:

(1) an agency of the state when applying laws relating to the furnishing of goods and services by the research applications center to the state or any other agency, political subdivision or institution of the state; and

(2) a governmental entity for purposes of the Tort Claims Act, provided that the research applications center may enter into agreements with insurance carriers to insure against risk in connection with its operations even though the risk may be included among the risks covered by the Tort Claims Act.

Section 7. [NEW MATERIAL] REVENUE BONDS.--The research applications center may, from time to time, issue negotiable revenue bonds. The proceeds from the sale of bonds shall be used to carry out the provisions of the New Mexico Research Applications Act, as specified in the board resolution authorizing the issuance of the bonds, and to fund reserves necessary to pay interest on the bonds and to pay necessary expenses of issuing the bonds. All bonds may be issued in one or more series. The bonds of each issue shall be dated and bear interest as prescribed by the board. The bonds shall mature serially, or otherwise, not later than forty years from their date and may be redeemable before maturity at the option of the research applications center at prices and under terms and conditions fixed by the board in its resolution authorizing the issuance of the bonds. The resolution shall also determine the form of the bonds, including the form of any interest coupons to be attached thereto, and shall fix the denominations of the bonds and the place of payment of the principal and interest thereon. The bonds shall be executed on behalf of the research applications center as special obligations of the research applications center payable only from the funds specified in the authorizing resolution and shall not be a debt of the state or any of its agencies, instrumentalities, institutions or political subdivisions. After registration and delivery to the purchasers, the bonds are incontestable and constitute special obligations of the research applications center and the bonds and coupons are negotiable instruments under the laws of this state. The bonds may be sold at public or private sale by the research applications center at prices and in accordance with procedures and terms the board determines to be advantageous and reasonably obtainable.

Section 8. [NEW MATERIAL] REFUNDING BONDS.--The research applications center may issue and sell at public or private sale revenue bonds to refund outstanding revenue bonds by exchange, immediate or prospective redemption, cancellation or escrow, including the escrow of debt service funds accumulated for payment of outstanding bonds, or any combination thereof, when, in its opinion, such action will be beneficial to the research applications center.

Section 9. [NEW MATERIAL] PLEDGE OF ASSETS OR REVENUES.--The pledge of any assets or revenues of the research applications center to the payment of the principal of or the interest on any bonds shall be valid and binding from the time that the pledge is made and the assets or revenues shall immediately be subject to a lien without any physical delivery or further act. The lien shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the research applications center, irrespective of whether such parties have notice thereof. Nothing in this section shall be construed to prohibit the research applications center from selling any assets subject to any such pledge except to the extent that the sale may be restricted by the resolution providing for the issuance of the bonds.

Section 10. [NEW MATERIAL] PLEDGE TO BONDHOLDERS.--The state pledges to and agrees with the holders of any bonds issued under the New Mexico Research Applications Act that the state will not limit or alter the rights vested in the research applications center by that act to fulfill the terms of any agreement made with the bondholders or in any way impair the rights and remedies of the bondholders until the bonds, together with the interest thereon, with interest on any unpaid installments of interest and all costs and expenses in connection with any action or proceedings by or on behalf of the bondholders are fully met and discharged. The research applications center is authorized to include this pledge and agreement of the state in any agreement with the bondholders.

Section 11. [NEW MATERIAL] SUIT MAY BE BROUGHT TO COMPEL PERFORMANCE.--Any holder of bonds or any person or officer being a party in interest may sue to enforce and compel the performance of the provisions of the New Mexico Research Applications Act or the board resolution under which the bonds were issued.

Section 12. [NEW MATERIAL] BONDS TAX EXEMPT.--All revenue bonds shall be exempt from taxation by the state or any of its political subdivisions.

Section 13. [NEW MATERIAL] LEGAL INVESTMENTS.--Revenue bonds are legal investments for any person or board charged with the investment of any public funds and are acceptable as security for any deposit of public money.

Section 14. [NEW MATERIAL] ANNUAL AUDIT AND REPORT.--The board shall contract annually with an independent certified public accountant to perform an examination and audit of the accounts and books of the research applications center, including its receipts, disbursements, contracts, leases, sinking funds, investments and any other records and papers relating to its financial standing. The certified public accountant shall make a determination as to whether the research applications center has complied with the provisions of the New Mexico Research Applications Act. The person performing the audit shall furnish copies of the audit report to the governor; the public regulation commission, where they shall be placed on file and made available for inspection by the general public; and the legislative finance committee.

Section 15. [NEW MATERIAL] CONFLICTS OF INTEREST.--

A. If any director, officer or employee of the research applications center is interested either directly or indirectly or is an officer or employee of or has any ownership interest in a legal entity interested directly or indirectly in a contract or potential contract with the research applications center, except for any agency, instrumentality, institution or political subdivision of the state, the interest shall be disclosed to the board and shall be set forth in the minutes of the board. The director, officer or employee having the interest shall not participate on behalf of the research applications center in the authorization of the contract.

B. No director, officer or employee of the research applications center or state officer shall accept any gratuities in connection with the issuance of bonds under the New Mexico Research Applications Act, nor shall any such individual be reimbursed for expenses incident to the issuing of bonds except such expenses as are reimbursed as provided under the rules of the board.

C. Nothing in this section shall prohibit an officer, director or employee of a financial institution from participating as a member of the board in setting general policies of the research applications center, nor shall any provision of this section be construed as prohibiting a financial institution of New Mexico from making loans guaranteed pursuant to the provisions of the New Mexico Research Applications Act because an officer, director or employee of the financial institution serves as a member of the board.

D. A person who violates the provisions of this section is guilty of a misdemeanor and, upon conviction, shall be punished pursuant to Section 31-19-1 NMSA 1978.

Section 16. [NEW MATERIAL] CONTRACTS INVOLVING PUBLIC EMPLOYEES.--Except as provided in Section 17 of the New Mexico Research Applications Act, the research applications center shall not enter into any contract involving services or property of a value in excess of twenty thousand dollars ($20,000) with an employee of the state or one of its agencies, instrumentalities, institutions or political subdivisions or with a business in which the employee has a controlling interest unless the governor or the governor's designee makes a determination, in writing, that the employee is able to provide services that are not readily available from another person or is able to provide services that are less expensive or of higher quality than are otherwise available.

Section 17. [NEW MATERIAL] TRANSFER OF TECHNOLOGY.--

A. Notwithstanding the provisions of Section 16 of the New Mexico Research Applications Act, Section 10-16-7,

13-1-190, 21-1-17 or 21-1-35 NMSA 1978 or of any other statute, ordinance or policy regulating the conduct of public employees, an officer or employee of the state or one of its agencies, instrumentalities, institutions or political subdivisions may, subject to Subsection B of this section, apply to the secretary of economic development for permission to establish and maintain a substantial interest in a private entity that provides or receives equipment, material, supplies or services in connection with the research applications center in order to facilitate the transfer of technology developed by the officer or employee from the research applications center to commercial and industrial enterprises for economic development.

B. The secretary of economic development may grant the permission only if all of the following conditions are met:

(1) the employer of the officer or employee certifies to the secretary that the employer does not object to the proposed relationship;

(2) the officer or employee provides a detailed description of the officer's or employee's interest in the private entity;

(3) the nature of the proposed undertaking is fully described;

(4) the officer or employee demonstrates, to the satisfaction of the secretary, that the proposed undertaking may benefit the economy of this state;

(5) the officer or employee demonstrates to the satisfaction of the secretary that the proposed undertaking will not adversely affect research, public service or instructional activities at any educational institution; and

(6) the officer's or employee's interest in the private entity or benefit from the interest will not adversely affect any substantial state interest.

C. The board may establish policies for the implementation of this section.

Section 18. Section 10-16-7 NMSA 1978 (being Laws 1967, Chapter 306, Section 7, as amended) is amended to read:

"10-16-7. CONTRACTS INVOLVING PUBLIC OFFICERS OR EMPLOYEES.--A state agency shall not enter into a contract for services, construction or items of tangible personal property with a public officer or employee of the state, with the family of the public officer or employee or with a business in which the public officer or employee or the family of the public officer or employee has a substantial interest unless the public officer or employee has disclosed the public officer's or employee's substantial interest and unless the contract is awarded pursuant to the Procurement Code, except that the potential contractor shall not be eligible for a sole source or small purchase contract; provided that this section does not apply to a contract of official employment with the state or to contracts made pursuant to the provisions of the University Research Park and Economic Development Act or the New Mexico Research Applications Act. A person negotiating or executing a contract on behalf of a state agency shall exercise due diligence to ensure compliance with the provisions of this section."

Section 19. Section 13-1-190 NMSA 1978 (being Laws 1984, Chapter 65, Section 163, as amended) is amended to read:

"13-1-190. UNLAWFUL EMPLOYEE PARTICIPATION PROHIBITED.--

A. Except as permitted by the University Research Park and Economic Development Act or the New Mexico Research Applications Act, it is unlawful for any state agency or local public body employee, as defined in the Procurement Code, to participate directly or indirectly in a procurement when the employee knows that the employee or any member of the employee's immediate family has a financial interest in the business seeking or obtaining a contract.

B. An employee or any member of an employee's immediate family who holds a financial interest in a disclosed blind trust shall not be deemed to have a financial interest with regard to matters pertaining to that trust."

Section 20. Section 21-1-17 NMSA 1978 (being Laws 1889, Chapter 138, Section 68, as amended) is amended to read:

"21-1-17. INTEREST IN CONTRACTS BY BOARD MEMBERS OR EMPLOYEES PROHIBITED.--No employee or member of a board of regents of [any] a state educational institution shall have [any] direct or indirect financial interest in any contract for building or improving any of that state educational institution or for the furnishing of supplies or services to that institution except as permitted pursuant to the University Research Park and Economic Development Act or the New Mexico Research Applications Act, or unless it complies with provisions of the Governmental Conduct Act and the Procurement Code."

Section 21. Section 21-1-35 NMSA 1978 (being Laws 1923, Chapter 148, Section 1415, as amended) is amended to read:

"21-1-35. SALES BY BOARDS, OFFICERS OR EMPLOYEES PROHIBITED--PARTIES TO CONTRACTS RECEIVING COMMISSION OR PROFIT--PENALTY.--No board of regents of a state educational institution, no member of a board and no school official or teacher, either directly or indirectly, shall sell to [any] a state educational institution that [he] the person is connected with by reason of being a member of a board of regents of a state educational institution or to [any] a school official or teacher, any school books, school furniture, equipment, apparatus or any other kind of school supplies, sell property insurance or life insurance to [any] an employee of that state educational institution or do any work under contract, nor shall any such board or members thereof or school officers or teachers receive any commission or profit on account thereof, and all such persons are prohibited from being parties directly or indirectly to any such contract or transaction; provided that the provisions of this section shall not apply to contracts that are entered into pursuant to the provisions of the University Research Park and Economic Development Act or the New Mexico Research Applications Act or that comply with provisions of the Governmental Conduct Act and the Procurement Code. Any person violating the provisions of this section shall be fined not exceeding one thousand dollars ($1,000) or imprisoned not exceeding one year in the penitentiary of New Mexico or be fined and imprisoned as set forth in this section in the discretion of the court."

Section 22. EMERGENCY.--It is necessary for the public peace, health and safety that this act take effect immediately.

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