HOUSE BILL 24

51st legislature - STATE OF NEW MEXICO - first session, 2013

INTRODUCED BY

James E. Smith and Timothy M. Keller

FOR THE SCIENCE, TECHNOLOGY AND TELECOMMUNICATIONS COMMITTEE AND THE REVENUE STABILIZATION AND TAX POLICY COMMITTEE

AN ACT

RELATING TO TAXATION; PROVIDING FOR A CREDIT OF GROSS RECEIPTS TAX DUE EQUAL TO FIFTY PERCENT OF CONTRIBUTIONS TO AN ELIGIBLE ENDOWMENT FUND OF A FOUR-YEAR PUBLIC POST-SECONDARY EDUCATIONAL INSTITUTION.

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

     SECTION 1. A new section of the Gross Receipts and Compensating Tax Act is enacted to read:

     "[NEW MATERIAL] CREDIT--GROSS RECEIPTS TAX--TECHNOLOGY COMMERCIALIZATION FUNDING.--

          A. A taxpayer may claim a credit against gross receipts tax due in an amount equal to fifty percent of a contribution made to an eligible endowment fund of a New Mexico four-year public post-secondary educational institution that promotes the commercialization of licensed technology conceived in a New Mexico four-year public post-secondary educational institution or federal scientific and engineering laboratory or test facility located in New Mexico.

          B. A taxpayer eligible for the tax credit pursuant to this section may claim the amount of each tax credit by crediting that amount against gross receipts taxes otherwise due pursuant to the Gross Receipts and Compensating Tax Act. The total amount of the tax credit shall be divided by twelve and taken on each monthly gross receipts tax return filed by the taxpayer against gross receipts taxes due the state for twelve consecutive months after the date of contribution. In no event shall the tax credits taken by an individual taxpayer exceed five hundred thousand dollars ($500,000) in a given calendar year. The department may allow a maximum annual aggregate of two million dollars ($2,000,000) in tax credits provided pursuant to this section. Claims for the tax credit shall be considered in the order received by the department. A taxpayer who submits a claim for a tax credit and who is unable to receive the tax credit because the claims exceed the annual aggregate limitation in this subsection shall be placed for the subsequent year ahead of the other taxpayers submitting claims in the subsequent year in the order of the date on which the department received the claim.

          C. An educational institution that receives a contribution to an eligible endowment fund shall certify to the department the use of money in the fund, the amount of contribution to the fund and the taxpayer who made the contribution. The department shall administer the credit provided pursuant to this section.

          D. The purpose of the tax credit provided by this section is to provide an incentive for the technology commercialization industry to locate and expand in New Mexico.

          E. On an annual basis starting in fiscal year 2018, an educational institution that receives a contribution to an eligible endowment fund shall report to the legislative finance committee, which shall evaluate and report to the appropriate legislative interim committee, on the uses of and expenditures from the fund, including:

                (1) the number of faculty recruited and retained;

                (2)  a description of any collaboration among the universities and between the universities funded by the fund and other institutions, agencies, entities or persons;

                (3) a description of current and projected technology research, development and commercialization and patent applications, and their economic impact;

                (4) an analysis of current and projected job creation and industry incubation and growth; and

                (5) any other information that the legislative finance committee deems appropriate or as requested by the appropriate legislative interim committee.

          F. As used in this section, "eligible endowment fund" means an endowment fund of a New Mexico four-year public post-secondary educational institution for which money in the fund is primarily used to:

                (1) develop and maintain collaboration agreements with universities or federal laboratories or research, development, testing and evaluating facilities to facilitate the transfer and commercialization of technology licensed or conceived in a New Mexico four-year public post-secondary educational institution or federal scientific and engineering laboratory or test facility located in New Mexico;

                (2) promote and market federal and state technology commercialization programs;

                (3) advise, assist, promote and develop business relating to technology commercialization or technology-based new business; or

                (4) develop early market demand that will advance the commercialization and widespread application of technology licensed or conceived in a New Mexico four-year public post-secondary educational institution or federal scientific and engineering laboratory or test facility located in New Mexico."

     SECTION 2. APPLICABILITY.--The provisions of this act apply to contributions made on or after July 1, 2013 and applied to gross receipts tax returns filed on or after August 1, 2013.

     SECTION 3. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2013.

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