SENATE BILL 465
49th legislature - STATE OF NEW MEXICO - first session, 2009
INTRODUCED BY
John Pinto
AN ACT
RELATING TO TAXATION; AMENDING SECTIONS OF THE NMSA 1978 CONCERNING THE NATIVE AMERICAN VETERANS' INCOME TAX SETTLEMENT FUND; MAKING APPROPRIATIONS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
Section 1. Section 7-2H-1 NMSA 1978 (being Laws 2008, Chapter 89, Section 1) is amended to read:
"7-2H-1. LEGISLATIVE FINDINGS.--
A. Native Americans have had a long history of serving their country through active duty in the armed forces of the United States during periods of both war and peace and have made great sacrifices in serving their country through active duty in the military during periods of war and peace.
B. Native American veterans domiciled [on] within the boundaries of their tribal lands or their spouse's tribal lands during their periods of active military service may have been exempt from paying state personal income taxes on their military [income] pay, but may have had state personal income taxes improperly withheld from their military [income] pay.
C. Native American veterans now are barred by the state statute of limitations from claiming refunds of state personal income taxes that may have been improperly withheld from their military [income] pay when they were domiciled within the boundaries of their tribal lands or their spouse's tribal lands during the period of their active military duty, and even if not barred by the statute of limitations, the passage of time extending to decades will make it difficult for many Native American veterans to meet strict standards of proof that they are entitled to a refund of improperly withheld state personal income taxes.
D. It is incumbent upon the state to ensure that it was not unjustly enriched by the improper withholding of state personal income taxes from Native American veterans who were domiciled within the boundaries of their tribal lands or their spouse's tribal lands during the period of their active military duty, and the state should implement a feasible means of refunding to Native American veterans any state personal income taxes that were improperly withheld from military pay while they were domiciled within the boundaries of their tribal lands or their spouse's tribal lands during the period of their active military duty."
Section 2. Section 7-2H-2 NMSA 1978 (being Laws 2008, Chapter 89, Section 2) is amended to read:
"7-2H-2. DEFINITIONS.--As used in [this act:
A. "department" means the veterans' services department;
B.] Chapter 7, Article 2H NMSA 1978:
A. "fund" means the Native American veterans' income tax settlement fund [and
C. "secretary" means the secretary of veterans' services]; and
B. "intertribal veterans task force" means a group of Native American veterans of the United States armed forces, including five representatives of the Navajo Nation, one representative of the Mescalero Apache Tribe, one representative of the Jicarilla Apache Nation and three representatives of the nineteen Indian pueblos in New Mexico, one of whom shall represent the Pueblo of Zuni."
Section 3. Section 7-2H-3 NMSA 1978 (being Laws 2008, Chapter 89, Section 3) is amended to read:
"7-2H-3. NATIVE AMERICAN VETERANS' INCOME TAX SETTLEMENT FUND--CREATED--PURPOSE--APPROPRIATIONS.--
A. The "Native American veterans' income tax settlement fund" is created as a nonreverting fund in the state treasury and shall be administered by the taxation and revenue department. The fund shall consist of money that is appropriated or donated or that otherwise accrues to the fund. Money in the fund shall be invested by the state investment officer in the manner that land grant permanent funds are invested pursuant to Chapter 6, Article 8 NMSA 1978. Income from investment of the fund shall be credited to the fund.
B. The taxation and revenue department shall, in consultation with the intertribal veterans task force, establish procedures and adopt rules as required to administer the fund and to make settlement payments from the fund as approved by the [secretary] legislature.
C. Money in the fund is appropriated to the taxation and revenue department to make settlement payments to Native American veterans who were domiciled within the boundaries of their tribal lands or their spouse's tribal lands during the period of their active military duty and had state personal income taxes improperly withheld from their military pay. No settlement payment shall be made until the Indian affairs department has completed and presented to the appropriate interim legislative committee a comprehensive independent study regarding New Mexico state personal income taxes that may have been withheld during the period 1942 through 1978 from the military income of Native American veterans when they were domiciled within the boundaries of their tribal lands or their spouse's tribal lands during the period of their active military duty. Money shall be disbursed from the fund only on warrant of the secretary of finance and administration upon vouchers signed by the secretary of [veterans' services] taxation and revenue or the secretary's authorized representative. Any unexpended or unencumbered balance remaining in the fund at the end of a fiscal year shall not revert to the general fund."
Section 4. Section 7-2H-4 NMSA 1978 (being Laws 2008, Chapter 89, Section 4) is amended to read:
"7-2H-4. DUTIES OF THE SECRETARY.--
[A. The secretary shall conduct a study in cooperation with the taxation and revenue department to determine whether Native American veterans who were domiciled on tribal lands during the period of their active military duty had state personal income taxes improperly withheld from their pay and if so, to determine the amount of state personal income taxes improperly withheld and the number and identity of Native American veterans or their survivors affected by the improper withholding of state personal income taxes.]
A. The secretary of veterans' services shall assist and cooperate with the taxation and revenue department and the intertribal veterans task force to conduct as thoroughly as possible a survey to determine the number and identity of Native American veterans or their survivors affected by the improper withholding of state personal income taxes.
B. The secretary of taxation and revenue and the secretary of veterans' services, in consultation with the intertribal veterans task force, shall promulgate rules for a state program to compensate Native American veterans or their survivors for state personal income taxes improperly withheld from military [income] pay while on active military duty and domiciled within the boundaries of the veteran's or the veteran's spouse's tribal lands.
C. The secretary of taxation and revenue shall report to the appropriate interim legislative committee no later than October 1 of each year regarding estimates of the amount of state personal income taxes improperly withheld from the military pay of Native American veterans domiciled on their respective tribal lands, the number of Native American veterans or their survivors affected by the improper withholding of state personal income taxes, total expenditures from the fund for the previous fiscal year and the anticipated appropriations to the fund needed to pay for settlements to be entered into for the next fiscal year."
Section 5. A new Section 7-2H-5 NMSA 1978 is enacted to read:
"7-2H-5. [NEW MATERIAL] INTERTRIBAL VETERANS TASK FORCE.--Each Indian nation, tribe or pueblo specifically entitled to membership on the intertribal veterans task force pursuant to Subsection B of Section 7-2H-2 NMSA 1978 shall designate its own task force members. The all Indian pueblo council shall designate two pueblo members to represent eighteen of the Indian pueblos of New Mexico, not including the Pueblo of Zuni. Native American veterans shall be consulted in the establishment of criteria for the designation of task force members."
Section 6. APPROPRIATIONS.--
A. Three hundred thousand dollars ($300,000) is appropriated from the general fund to the Indian affairs department for expenditure in fiscal year 2010 for an independent study, including legal research, regarding New Mexico state personal income taxes that may have been withheld during the period 1942 through 1978 from the military income of Native American veterans when they were domiciled within the boundaries of their tribal lands or their spouse's tribal lands during the period of their active military duty. The Indian affairs department, in collaboration with the intertribal veterans task force, shall contract with independent legal counsel to participate in the study and conduct legal research required pursuant to this act. The study required pursuant to this subsection shall be completed and presented to the appropriate interim legislative committee no later than October 1, 2009. Any unexpended or unencumbered balance remaining at the end of fiscal year 2010 shall revert to the general fund.
B. An appropriate amount based upon the conclusions of the study conducted pursuant to Subsection C of Section
7-2H-3 NMSA 1978 is appropriated from the general fund to the Native American veterans' income tax settlement fund for expenditure in fiscal year 2010 and subsequent fiscal years to carry out the purposes of the fund. Any unexpended or unencumbered balance remaining at the end of a fiscal year shall not revert to the general fund.
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