SENATE BILL 217

51st legislature - STATE OF NEW MEXICO - second session, 2014

INTRODUCED BY

George K. Munoz

AN ACT

RELATING TO TAXATION; PROVIDING AN EXCEPTION ON THE REDUCTION IN HOLD HARMLESS DISTRIBUTIONS FOR CERTAIN COUNTIES.

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

     SECTION 1. Section 7-1-6.47 NMSA 1978 (being Laws 2004, Chapter 116, Section 2, as amended) is amended to read:

     "7-1-6.47. DISTRIBUTION TO COUNTIES--OFFSET FOR FOOD DEDUCTION AND HEALTH CARE PRACTITIONER SERVICES DEDUCTION.--

          A. [For a county that has not elected to impose a county hold harmless gross receipts tax through an ordinance and that has a population of less than forty-eight thousand according to the most recent federal decennial census] A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to [a county] the following counties in an amount, subject to any increase or decrease made pursuant to Section 7-1-6.15 NMSA 1978, equal to the [sum of:

                (1) the total deductions claimed pursuant to Section 7-9-92 NMSA 1978 for the month by taxpayers from business locations within a municipality in the county multiplied by the combined rate of all county local option gross receipts taxes in effect for the month that are imposed throughout the county;

                (2) the total deductions claimed pursuant to Section 7-9-92 NMSA 1978 for the month by taxpayers from business locations in the county but not within a municipality multiplied by the combined rate of all county local option gross receipts taxes in effect for the month that are imposed in the county area not within a municipality;

                (3) the total deductions claimed pursuant to Section 7-9-93 NMSA 1978 for the month by taxpayers from business locations within a municipality in the county multiplied by the combined rate of all county local option gross receipts taxes in effect for the month that are imposed throughout the county; and

                (4) the total deductions claimed pursuant to Section 7-9-93 NMSA 1978 for the month by taxpayers from business locations in the county but not within a municipality multiplied by the combined rate of all county local option gross receipts taxes in effect for the month that are imposed in the county area not within a municipality] applicable maximum distribution for each county:

                (1) a county that does not have in effect a county hold harmless gross receipts tax through an ordinance and that has a population of less than forty-eight thousand according to the most recent federal decennial census; and

                (2) a class B county that does not have in effect a county hold harmless gross receipts tax through an ordinance and that has a population of seventy thousand or more according to the most recent federal decennial census and a property valuation of more than seven hundred thirty million dollars ($730,000,000) and less than one billion dollars ($1,000,000,000).

          B. For a county not described in Subsection A of this section, a distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the county in an amount, subject to any increase or decrease made pursuant to Section 7-1-6.15 NMSA 1978, equal to the [sum of:

                (1) the total deductions claimed pursuant to Section 7-9-92 NMSA 1978 for the month by taxpayers from business locations within a municipality in the county multiplied by the combined rate of all county local option gross receipts taxes in effect on January 1, 2007 that are imposed throughout the county in] applicable maximum distribution for the county multiplied by the following percentages:

                [(a)] (1) prior to July 1, 2015, one hundred percent;

                [(b)] (2) on or after July 1, 2015 and prior to July 1, 2016, ninety-four percent;

                [(c)] (3) on or after July 1, 2016 and prior to July 1, 2017, eighty-eight percent;

                [(d)] (4) on or after July 1, 2017 and prior to July 1, 2018, eighty-two percent;

                [(e)] (5) on or after July 1, 2018 and prior to July 1, 2019, seventy-six percent;

                [(f)] (6) on or after July 1, 2019 and prior to July 1, 2020, seventy percent;

                [(g)] (7) on or after July 1, 2020 and prior to July 1, 2021, sixty-three percent;

                [(h)] (8) on or after July 1, 2021 and prior to July 1, 2022, fifty-six percent;

                [(i)] (9) on or after July 1, 2022 and prior to July 1, 2023, forty-nine percent;

                [(j)] (10) on or after July 1, 2023 and prior to July 1, 2024, forty-two percent;

                [(k)] (11) on or after July 1, 2024 and prior to July 1, 2025, thirty-five percent;

                [(l)] (12) on or after July 1, 2025 and prior to July 1, 2026, twenty-eight percent;

                [(m)] (13) on or after July 1, 2026 and prior to July 1, 2027, twenty-one percent;

                [(n)] (14) on or after July 1, 2027 and prior to July 1, 2028, fourteen percent; and

                [(o)] (15) on or after July 1, 2028 and prior to July 1, 2029, seven percent.

                [(2) the total deductions claimed pursuant to Section 7-9-92 NMSA 1978 for the month by taxpayers from business locations in the county but not within a municipality multiplied by the combined rate of all county local option gross receipts taxes in effect on January 1, 2007 that are imposed in the county area not within a municipality in the following percentages:

                     (a) prior to July 1, 2015, one hundred percent;

                     (b) on or after July 1, 2015 and prior to July 1, 2016, ninety-four percent;

                     (c) on or after July 1, 2016 and prior to July 1, 2017, eighty-eight percent;

                     (d) on or after July 1, 2017 and prior to July 1, 2018, eighty-two percent;

                     (e) on or after July 1, 2018 and prior to July 1, 2019, seventy-six percent;

                     (f) on or after July 1, 2019 and prior to July 1, 2020, seventy percent;

                     (g) on or after July 1, 2020 and prior to July 1, 2021, sixty-three percent;

                     (h) on or after July 1, 2021 and prior to July 1, 2022, fifty-six percent;

                     (i) on or after July 1, 2022 and prior to July 1, 2023, forty-nine percent;

                     (j) on or after July 1, 2023 and prior to July 1, 2024, forty-two percent;

                     (k) on or after July 1, 2024 and prior to July 1, 2025, thirty-five percent;

                     (l) on or after July 1, 2025 and prior to July 1, 2026, twenty-eight percent;

                     (m) on or after July 1, 2026 and prior to July 1, 2027, twenty-one percent;

                     (n) on or after July 1, 2027 and prior to July 1, 2028, fourteen percent; and

                     (o) on or after July 1, 2028 and prior to July 1, 2029, seven percent;

                (3) the total deductions claimed pursuant to Section 7-9-93 NMSA 1978 for the month by taxpayers from business locations within a municipality in the county multiplied by the combined rate of all county local option gross receipts taxes in effect on January 1, 2007 that are imposed throughout the county in the following percentages:

                     (a) prior to July 1, 2015, one hundred percent;

                     (b) on or after July 1, 2015 and prior to July 1, 2016, ninety-four percent;

                     (c) on or after July 1, 2016 and prior to July 1, 2017, eighty-eight percent;

                     (d) on or after July 1, 2017 and prior to July 1, 2018, eighty-two percent;

                     (e) on or after July 1, 2018 and prior to July 1, 2019, seventy-six percent;

                     (f) on or after July 1, 2019 and prior to July 1, 2020, seventy percent;

                     (g) on or after July 1, 2020 and prior to July 1, 2021, sixty-three percent;

                     (h) on or after July 1, 2021 and prior to July 1, 2022, fifty-six percent;

                     (i) on or after July 1, 2022 and prior to July 1, 2023, forty-nine percent;

                     (j) on or after July 1, 2023 and prior to July 1, 2024, forty-two percent;

                     (k) on or after July 1, 2024 and prior to July 1, 2025, thirty-five percent;

                     (l) on or after July 1, 2025 and prior to July 1, 2026, twenty-eight percent;

                     (m) on or after July 1, 2026 and prior to July 1, 2027, twenty-one percent;

                     (n) on or after July 1, 2027 and prior to July 1, 2028, fourteen percent; and

                     (o) on or after July 1, 2028 and prior to July 1, 2029, seven percent; and

                (4) the total deductions claimed pursuant to Section 7-9-93 NMSA 1978 for the month by taxpayers from business locations in the county but not within a municipality multiplied by the combined rate of all county local option gross receipts taxes in effect on January 1, 2007 that are imposed in the county area not within a municipality in the following percentages:

                     (a) prior to July 1, 2015, one hundred percent;

                     (b) on or after July 1, 2015 and prior to July 1, 2016, ninety-four percent;

                     (c) on or after July 1, 2016 and prior to July 1, 2017, eighty-eight percent;

                     (d) on or after July 1, 2017 and prior to July 1, 2018, eighty-two percent;

                     (e) on or after July 1, 2018 and prior to July 1, 2019, seventy-six percent;

                     (f) on or after July 1, 2019 and prior to July 1, 2020, seventy percent;

                     (g) on or after July 1, 2020 and prior to July 1, 2021, sixty-three percent;

                     (h) on or after July 1, 2021 and prior to July 1, 2022, fifty-six percent;

                     (i) on or after July 1, 2022 and prior to July 1, 2023, forty-nine percent;

                     (j) on or after July 1, 2023 and prior to July 1, 2024, forty-two percent;

                     (k) on or after July 1, 2024 and prior to July 1, 2025, thirty-five percent;

                     (l) on or after July 1, 2025 and prior to July 1, 2026, twenty-eight percent;

                     (m) on or after July 1, 2026 and prior to July 1, 2027, twenty-one percent;

                     (n) on or after July 1, 2027 and prior to July 1, 2028, fourteen percent; and

                     (o) on or after July 1, 2028 and prior to July 1, 2029, seven percent.]

          C. [The] A distribution pursuant to [Subsections A and B of] this section is in lieu of revenue that would have been received by the county but for the deductions provided by Sections 7-9-92 and 7-9-93 NMSA 1978. The distribution shall be considered gross receipts tax revenue and shall be used by the county in the same manner as gross receipts tax revenue, including payment of gross receipts tax revenue bonds. [A distribution pursuant to this section to a county not described in Subsection A of this section or to a county that has imposed a gross receipts tax through an ordinance that does not provide a deduction contained in the Gross Receipts and Compensating Tax Act shall not be made on or after July 1, 2029.]

          D. If the reductions made by this [2013] 2014 act to the distributions made pursuant to [Subsections A and B of] this section impair the ability of a county to meet its principal or interest payment obligations for revenue bonds that are outstanding prior to July 1, 2013 and that are secured by the pledge of all or part of the county's revenue from the distribution made pursuant to this section, then the amount distributed pursuant to this section to that county shall be increased by an amount sufficient to meet the required payment; provided that the total amount distributed to that county pursuant to this section does not exceed the amount that would have been due that county pursuant to this section as it was in effect on June 30, [2013] 2015.

          E. A distribution pursuant to this section may be adjusted for a distribution made to a tax increment development district with respect to a portion of a gross receipts tax increment dedicated by a county pursuant to the Tax Increment for Development Act.

          F. For purposes of this section:

                (1) "maximum distribution" means:

                     (a) for counties that have a population of less than forty-eight thousand according to the most recent federal decennial census, the sum of: 1) the total deductions claimed pursuant to Sections 7-9-92 and 7-9-93 NMSA 1978 for the month by taxpayers from business locations within a municipality in the county multiplied by the combined rate of all county local option gross receipts taxes in effect for the month that are imposed throughout the county; and 2) the total deductions claimed pursuant to Sections 7-9-92 and 7-9-93 NMSA 1978 for the month by taxpayers from business locations in the county but not within a municipality multiplied by the combined rate of all county local option gross receipts taxes in effect for the month that are imposed in the county area not within a municipality; and

                     (b) for counties that have a population of forty-eight thousand or more according to the most recent federal decennial census, the sum of: 1) the total deductions claimed pursuant to Sections 7-9-92 and 7-9-93 NMSA 1978 for the month by taxpayers from business locations within a municipality in the county multiplied by the combined rate of all county local option gross receipts taxes in effect on January 1, 2007 that are imposed throughout the county; and 2) the total deductions claimed pursuant to Sections 7-9-92 and 7-9-93 NMSA 1978 for the month by taxpayers from business locations in the county but not within a municipality multiplied by the combined taxes in effect on January 1, 2007 that are imposed in the county area not within a municipality; and

                (2) "tax revenue" means the net receipts attributable to a county hold harmless gross receipts tax."

     SECTION 2. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2015.

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