HOUSE APPROPRIATIONS AND FINANCE COMMITTEE SUBSTITUTE FOR

HOUSE BILL 346

49th legislature - STATE OF NEW MEXICO - first session, 2009

AN ACT

RELATING TO TAXATION; IMPOSING AN EDUCATION SURTAX ON GROSS RECEIPTS AND COMPENSATING TAX FOR DISTRIBUTION TO THE PUBLIC SCHOOL FUND; PROVIDING A CONTINGENCY; MAKING AN APPROPRIATION.

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:

     "[NEW MATERIAL] DISTRIBUTION--PUBLIC SCHOOL FUND--EDUCATION SURTAX RECEIPTS.--A distribution pursuant to Section 7-1-6.1 NMSA 1978 of the net receipts attributable to the education surtax shall be made to the public school fund."

     Section 2. A new section of the Gross Receipts and Compensating Tax Act is enacted to read:

     "[NEW MATERIAL] GROSS RECEIPTS--EDUCATION SURTAX.--The gross receipts tax shall be increased by a surtax, hereby imposed, of three-fourths of one percent of gross receipts. The surtax may be referred to as the "education surtax". The department shall administer and enforce collection of the education surtax pursuant to the provisions of the Tax Administration Act and the Gross Receipts and Compensating Tax Act in the same manner as the gross receipts tax."

     Section 3. A new section of the Gross Receipts and Compensating Tax Act is enacted to read:

     "[NEW MATERIAL] COMPENSATING TAX--EDUCATION SURTAX.--The compensating tax shall be increased by a surtax, hereby imposed, of three-fourths of one percent of the value of tangible property and services as provided in Section 7-9-7 NMSA 1978. The surtax may be referred to as the "education surtax". The department shall administer and enforce collection of the education surtax pursuant to the provisions of the Tax Administration Act and the Gross Receipts and Compensating Tax Act in the same manner as the compensating tax."

     Section 4. DISTRIBUTION AND APPROPRIATION.--Notwithstanding the provisions of Section 1 of this act, the first six hundred thousand dollars ($600,000) of the revenue raised from the education surtax shall not be distributed to the public school fund but is distributed and appropriated to the public education department for expenditure in fiscal years 2010 and 2011 to verify and correct public school data, to make necessary changes to the department's data collection system, to beta test the public school funding formula and to provide training to public school personnel as provided in House Bill 331 of the forty-ninth legislature, first session, if that bill becomes law. Any unexpended or unencumbered balance remaining at the end of fiscal year 2011 shall revert to the public school fund.

     Section 5. EFFECTIVE DATE--CONTINGENCY.--

          A. Except as provided in Subsection B of this section, the effective date of the provisions of this act is July 1, 2009.

           B. This act is contingent upon the enactment into law of a bill of the first session of the forty-ninth legislature that provides a new method for determining the state equalization guarantee distribution to public schools. If no such bill is enacted into law, the provisions of this act shall not become effective.

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