SENATE BILL 555

52nd legislature - STATE OF NEW MEXICO - first session, 2015

INTRODUCED BY

George K. Munoz

AN ACT

RELATING TO TAXATION; EXCLUDING A MUNICIPALITY OR COUNTY FROM HOLD HARMLESS DISTRIBUTION REDUCTIONS IN CERTAIN CIRCUMSTANCES.

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] EXCEPTION TO THE REDUCTIONS IN HOLD HARMLESS DISTRIBUTIONS TO MUNICIPALITIES AND COUNTIES TO OFFSET THE FOOD AND HEALTH CARE PRACTITIONER SERVICES DEDUCTIONS.--

          A. Notwithstanding the requirements of Section 7-1-6.46 NMSA 1978, a distribution pursuant to that section to a municipality that does not have in effect and has not had in effect a municipal hold harmless gross receipts tax shall not be further reduced pursuant to that section if:

                (1) for:

                     (a) fiscal year 2017, the average annual growth of the taxable gross receipts tax base of the municipality from the end of fiscal year 2013 to the end of fiscal year 2015 is less than two percent of the average of the taxable gross receipts tax base for the municipality for fiscal years 2012, 2013 and 2014; or

                     (b) each subsequent fiscal year, the average annual growth of the taxable gross receipts tax base of the municipality from the end of fiscal year 2013 to the end of the fiscal year that ended twelve months earlier is less than two percent of the average of the taxable gross receipts tax base for the municipality for fiscal years 2012, 2013 and 2014; and

                (2) the poverty rate for the county in which the municipality is located is greater than thirty percent.

          B. Notwithstanding the requirements of Section 7-1-6.47 NMSA 1978, a distribution pursuant to that section to a county that does not have in effect and has not had in effect a county hold harmless gross receipts tax shall not be further reduced pursuant to that section if:

                (1) for:

                     (a) fiscal year 2017, the average annual growth of the taxable gross receipts tax base of the county from the end of fiscal year 2013 to the end of fiscal year 2015 is less than two percent of the average of the taxable gross receipts tax base for the county for fiscal years 2012, 2013 and 2014; or

                     (b) each subsequent fiscal year, the average annual growth of the taxable gross receipts tax base of the county from the end of fiscal year 2013 to the end of the fiscal year that ended twelve months earlier is less than two percent of the average of the taxable gross receipts tax base for the county for fiscal years 2012, 2013 and 2014; and

                (2) the poverty rate for the county is greater than thirty percent.

          C. As used in this section, "poverty rate" means the poverty rate for all ages as estimated by the United States census bureau in its 2013 small area income and poverty estimates published in December 2014."

     SECTION 2. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2016.

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