SB0157

SENATE BILL 157

52nd legislature - STATE OF NEW MEXICO - second session, 2016

INTRODUCED BY

Lee S. Cotter

AN ACT

RELATING TO FINANCE; LIMITING THE SPACEPORT AUTHORITY'S POWER TO ISSUE BONDS OR TO REFUND BONDS; LIMITING THE USE OF CERTAIN PROCEEDS OF THE MUNICIPAL AND COUNTY REGIONAL SPACEPORT GROSS RECEIPTS TAX; REQUIRING VOTER APPROVAL FOR ADDITIONAL BONDS.

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

SECTION 1. Section 5-16-1 NMSA 1978 (being Laws 2006, Chapter 15, Section 1) is amended to read:

"5-16-1. SHORT TITLE.--[Sections 1 through 13 of this act] Chapter 5, Article 16 NMSA 1978 may be cited as the "Regional Spaceport District Act"."

SECTION 2. Section 5-16-13 NMSA 1978 (being Laws 2006, Chapter 15, Section 13) is amended to read:

"5-16-13. USE OF REVENUE BY GOVERNMENTAL UNITS.--

A. Each governmental unit that is a county or municipality and is a member of a combination shall have enacted a municipal regional spaceport gross receipts tax or a county regional spaceport gross receipts tax prior to December 31, 2008.

B. At least seventy-five percent of the municipal regional spaceport gross receipts tax or county regional spaceport gross receipts tax revenues received by each governmental unit [must] shall be used by the district for the financing, planning, designing, engineering and construction of a regional spaceport; provided that the full amount of revenues of the municipal or county regional spaceport gross receipts tax that are received on or after July 1, 2016 pursuant to this subsection shall only be used for:

(1) bonds issued prior to July 1, 2016 on behalf of the district pursuant to the terms and conditions of the version of the Spaceport Development Act in effect on the date of issuance of those bonds:

(a) to pay principal and interest on those bonds until those bonds are fully retired or discharged;

(b) for acceleration of the payment of principal and interest on those bonds or to retire or discharge

those bonds prior to their original term; or

(c) to refinance or refund those bonds as long as the refinancing or refunding does not increase the amount of outstanding principal owed by the spaceport authority or by a district; or

(2) bonds approved by voters and issued on behalf of the district by the spaceport authority pursuant to Paragraph (8) of Subsection B of Section 58-31-5 NMSA 1978.

C. No more than twenty-five percent of the municipal regional spaceport gross receipts tax or county regional spaceport gross receipts tax revenues may be used by the governmental unit enacting the tax for spaceport-related projects as approved by resolution of the governmental unit."

SECTION 3. Section 7-19D-15 NMSA 1978 (being Laws 2006, Chapter 15, Section 14) is amended to read:

"7-19D-15. MUNICIPAL REGIONAL SPACEPORT GROSS RECEIPTS TAX--AUTHORITY TO IMPOSE--RATE--ELECTION REQUIRED.--

A. A majority of the members of the governing body of a municipality that desires to become a member of a regional spaceport district pursuant to the Regional Spaceport District Act shall impose by ordinance an excise tax at a rate not to exceed one-half percent of the gross receipts of a person engaging in business in the municipality for the privilege of engaging in business. A tax imposed pursuant to this section may be imposed by one or more ordinances, each imposing any number of tax rate increments, but an increment shall not be less than one-sixteenth percent of the gross receipts of a person engaging in business in the municipality, and the aggregate of all rates shall not exceed one-half percent of the gross receipts of a person engaging in business in the municipality. The tax may be referred to as the "municipal regional spaceport gross receipts tax".

B. A governing body, at the time of enacting an ordinance imposing a tax authorized in Subsection A of this section:

(1) shall dedicate a minimum of seventy-five percent of the revenue from the tax to a regional spaceport district for the financing, planning, designing, engineering and construction of a regional spaceport pursuant to the Regional Spaceport District Act; provided that the full amount of revenues of the municipal regional spaceport gross receipts tax that are received on or after July 1, 2016 pursuant to this subsection shall only be used for:

(a) bonds issued prior to July 1, 2016 on behalf of a regional spaceport district pursuant to the terms and conditions of the version of the Spaceport Development Act in effect on the date of issuance of those bonds: 1) to pay principal and interest on those bonds until those bonds are fully retired or discharged; 2) for acceleration of the payment of principal and interest on those bonds or to retire or discharge those bonds prior to their original term; or 3) to refinance or refund those bonds as long as the refinancing or refunding does not increase the amount of outstanding principal owed by the spaceport authority or by a regional spaceport district; or

(b) bonds approved by voters and issued on behalf of a regional spaceport district by the spaceport authority pursuant to Paragraph (8) of Subsection B of Section 58-31-5 NMSA 1978; and

(2) may dedicate no more than twenty-five percent of the revenue for spaceport-related projects as approved by resolution of the governing body of the municipality.

C. An ordinance imposing a municipal regional spaceport gross receipts tax shall not go into effect until after an election is held and a majority of the voters of the municipality voting in the election votes in favor of imposing the tax. The governing body shall adopt a resolution calling for an election within seventy-five days of the date the ordinance is adopted on the question of imposing the tax. The question shall be submitted to the voters of the municipality as a separate question at a regular municipal election or at a special election called for that purpose by the governing body. A special municipal election shall be called, conducted and canvassed as provided in the Municipal Election Code. If a majority of the voters voting on the question approves the ordinance imposing the municipal regional spaceport gross receipts tax, the ordinance shall become effective in accordance with the provisions of the Municipal Local Option Gross Receipts Taxes Act. If the question of imposing the municipal regional spaceport gross receipts tax fails, the governing body shall not again propose the imposition of an increment of the tax for a period of one year from the date of the election.

D. Subject to the provisions of Subsection B of this section, the governing body of a municipality imposing the municipal regional spaceport gross receipts tax shall transfer a minimum of seventy-five percent of all proceeds from the tax to the regional spaceport district of which it is a member for regional spaceport purposes in accordance with the provisions of the Regional Spaceport District Act. The governing body of a municipality imposing the municipal regional spaceport gross receipts tax may retain no more than twenty-five percent of the municipal regional spaceport gross receipts tax for spaceport-related projects as approved by resolution of the governing body."

SECTION 4. Section 7-20E-25 NMSA 1978 (being Laws 2006, Chapter 15, Section 15) is amended to read:

"7-20E-25. COUNTY REGIONAL SPACEPORT GROSS RECEIPTS TAX--AUTHORITY TO IMPOSE--RATE--ELECTION REQUIRED.--

A. A majority of the members of the governing body of a county that desires to become a member of a regional spaceport district pursuant to the Regional Spaceport District Act shall impose by ordinance an excise tax at a rate not to exceed one-half percent of the gross receipts of a person engaging in business in the district area of the county for the privilege of engaging in business. A tax imposed pursuant to this section may be imposed by one or more ordinances, each imposing any number of tax rate increments, but an increment shall not be less than one-sixteenth percent of the gross receipts of a person engaging in business in the district area of the county, and the aggregate of all rates shall not exceed one-half percent of the gross receipts of a person engaging in business in the district area of the county. The tax may be referred to as the "county regional spaceport gross receipts tax".

B. A governing body, at the time of enacting an ordinance imposing the tax authorized in Subsection A of this section:

(1) shall dedicate a minimum of seventy-five percent of the proceeds of the revenue from the tax to the regional spaceport district for the financing, planning, designing, [and] engineering and construction of a spaceport or for projects or services of the district pursuant to the Regional Spaceport District Act; provided that the full amount of revenues of the county regional spaceport gross receipts tax that are received on or after July 1, 2016 pursuant to this subsection shall only be used for:

(b) bonds approved by voters and issued on behalf of a regional spaceport district by the spaceport authority pursuant to Paragraph (8) of Subsection B of Section 58-31-5 NMSA 1978; and

(2) may dedicate no more than twenty-five percent of the revenue for spaceport-related projects as approved by resolution of the governing body of the county.

C. An ordinance imposing a county regional spaceport gross receipts tax shall not go into effect until after an election is held and a majority of the voters of the district area of the county voting in the election votes in favor of imposing the tax. The governing body shall adopt an ordinance calling for an election within seventy-five days of the date the resolution is adopted on the question of imposing the tax. The question shall be submitted to the voters of the district area of the county as a separate question at a general election or at a special election called for that purpose by the governing body. A special election shall be called, conducted and canvassed substantially in the same manner as provided by law for general elections. If a majority of the voters voting on the question approves the ordinance imposing the county regional spaceport gross receipts tax, the ordinance shall become effective in accordance with the provisions of the County Local Option Gross Receipts Taxes Act. If the question of imposing the county regional spaceport gross receipts tax fails, the governing body shall not again propose the imposition of an increment of the tax for a period of one year from the date of the election.

D. Subject to the provisions of Subsection B of this section, the governing body of a county imposing a county regional spaceport gross receipts tax shall transfer a minimum of seventy-five percent of all proceeds from the tax to the regional spaceport district of which it is a member for the purposes in accordance with the provisions of the Regional Spaceport District Act. The governing body of a county imposing a county regional spaceport gross receipts tax may retain no more than twenty-five percent of the county regional spaceport gross receipts tax for spaceport-related projects as approved by the resolution of the governing body of the county.

E. As used in this section, "district area of the county" means that portion of a county that is outside the boundaries of a municipality and that is within the boundaries of a regional spaceport district of which the county is a member; provided that if no municipality within the county has imposed a municipal regional spaceport gross receipts tax, "district area of the county" may mean the area within the boundaries of the county that is within the boundaries of a regional spaceport district of which the county is a member."

SECTION 5. Section 58-31-1 NMSA 1978 (being Laws 2005, Chapter 128, Section 1) is amended to read:

"58-31-1. SHORT TITLE.--[This act] Chapter 58, Article 31 NMSA 1978 may be cited as the "Spaceport Development Act"."

SECTION 6. Section 58-31-5 NMSA 1978 (being Laws 2005, Chapter 128, Section 5, as amended) is amended to read:

"58-31-5. AUTHORITY POWERS AND DUTIES.--

A. The authority shall:

(1) hire an executive director, who shall employ the necessary professional, technical and clerical staff to enable the authority to function efficiently and shall direct the affairs and business of the authority, subject to the direction of the authority;

(2) be located within fifty miles of a southwest regional spaceport;

(3) advise the governor, the governor's staff and the New Mexico finance authority oversight committee on methods, proposals, programs and initiatives involving a southwest regional spaceport that may further stimulate space-related business and employment opportunities in New Mexico;

(4) initiate, develop, acquire, own, construct, maintain and lease space-related projects;

(5) make and execute all contracts and other instruments necessary or convenient to the exercise of its powers and duties;

(6) create programs to expand high-technology economic opportunities within New Mexico;

(7) create avenues of communication among federal government agencies, the space industry, users of space launch services and academia concerning space business;

(8) promote legislation that will further the goals of the authority and development of space business;

(9) oversee and fund production of promotional literature related to the authority's goals;

(10) identify science and technology trends that are significant to space enterprise and the state and act as a clearinghouse for space enterprise issues and information;

(11) coordinate and expedite the involvement of the state executive branch's space-related development efforts; and

(12) perform environmental, transportation, communication, land use and other technical studies necessary or advisable for projects and programs or to secure licensing by appropriate United States agencies.

B. The authority may:

(1) advise and cooperate with municipalities, counties, state agencies and organizations, appropriate federal agencies and organizations and other interested persons and groups;

(2) solicit and accept federal, state, local and private grants of funds or property and financial or other aid for the purpose of carrying out the provisions of the Spaceport Development Act;

(3) adopt rules governing the manner in which its business is transacted and the manner in which the powers of the authority are exercised and its duties performed;

(4) operate spaceport facilities, including acquisition of real property necessary for spaceport facilities and the filing of necessary documents with appropriate agencies;

(5) construct, purchase, accept donations of or lease projects located within the state;

(6) sell, lease or otherwise dispose of a project upon terms and conditions acceptable to the authority and in the best interests of the state;

(7) subject to the provisions of Paragraph (8) of this subsection, issue revenue bonds and borrow money for the purpose of defraying the cost of acquiring a project by purchase or construction and of securing the payment of the bonds or repayment of a loan;

(8) enter into contracts with regional spaceport districts and issue bonds on behalf of regional spaceport districts for the purpose of financing the purchase, construction, renovation, equipping or furnishing of a regional spaceport or a spaceport-related project; provided that on and after July 1, 2016, bonds may only be issued on behalf of a regional spaceport district if a majority of the voters in each municipality or county that form that district vote to approve of the authority issuing those bonds. The governing body of a municipality or county may adopt a resolution calling for an election on the question of approving the issuance of bonds. The question shall be submitted to the voters of a municipality as a separate question at a regular municipal election or at a special election called for that purpose by the governing body. A special municipal election shall be called, conducted and canvassed as provided in the Municipal Election Code. The question shall be submitted to the voters of the district area of a county as a separate question at a general election or at a special election called for that purpose by the governing body. A special county election shall be called, conducted and canvassed substantially in the same manner as provided by law for general elections. If the majority of voters in each municipality or county voting on the question approves the issuance of bonds, the authority may issue bonds pursuant to this paragraph. As used in this paragraph, "district area of the county" means that portion of a county that is outside the boundaries of a municipality and that is within the boundaries of a regional spaceport district of which the county is a member; provided that, if no municipality within the county has imposed a municipal regional spaceport gross receipts tax,

"district area of the county" includes the area within the

boundaries of the county that is within the boundaries of a

regional spaceport district of which the county is a member;

(9) refinance a project;

(10) contract with any competent private or public organization or individual to assist in the fulfillment of its duties;

(11) fix, alter, charge and collect tolls, fees or rentals and impose any other charges for the use of or for services rendered by any authority facility, program or service; and

(12) contract with regional spaceport districts to receive municipal spaceport gross receipts tax and county regional spaceport gross receipts tax revenues; provided that the full amount of revenues of the municipal or county regional spaceport gross receipts tax that are received on or after July 1, 2016 pursuant to this subsection shall only be used for:

(b) bonds approved by voters and issued on behalf of a regional spaceport district by the spaceport authority pursuant to Paragraph (8) of this subsection.

C. The authority shall not:

(1) incur debt as a general obligation of the state or pledge the full faith and credit of the state to repay debt; or

(2) expend funds or incur debt for the improvement, maintenance, repair or addition to property unless it is owned by the authority, the state or a political subdivision of the state."

SECTION 7. Section 58-31-6 NMSA 1978 (being Laws 2005, Chapter 128, Section 6, as amended) is amended to read:

"58-31-6. SPACEPORT AUTHORITY--BONDING AUTHORITY--POWER TO ISSUE REVENUE BONDS.--

A. Subject to the limitations in Paragraph (12) of Subsection B of Section 58-31-5 NMSA 1978, the authority may issue revenue bonds on its own behalf or on behalf of a regional spaceport district, for regional spaceport purposes and spaceport-related projects. Revenue bonds so issued may be considered appropriate investments for the severance tax permanent fund or collateral for the deposit of public funds if the bonds are rated not less than "A" by a national rating service and both the principal and interest of the bonds are fully and unconditionally guaranteed by a lease agreement executed by an agency of the United States government or by a corporation organized and operating within the United States, that corporation or the long-term debt of that corporation being rated not less than "A" by a national rating service. All bonds issued by the authority are legal and authorized investments for banks, trust companies, savings and loan associations and insurance companies.

B. The authority may pay from the bond proceeds all expenses, premiums and commissions that the authority deems necessary or advantageous in connection with the authorization, sale and issuance of the bonds.

C. Authority revenue bonds:

(1) may have interest or appreciated principal value or any part thereof payable at intervals determined by the authority;

(2) may be subject to prior redemption or mandatory redemption at the authority's option at the time and upon such terms and conditions with or without the payment of a premium as may be provided by resolution of the authority;

(3) may mature at any time not exceeding twenty years after the date of issuance if secured by revenue from the county or municipal regional spaceport gross receipts tax or thirty years if secured by revenue from other sources;

(4) may be serial in form and maturity; consist of one or more bonds payable at one time or in installments; or may be in such other form as determined by the authority;

(5) may be in registered or bearer form or in book-entry form through facilities of a securities depository either as to principal or interest or both;

(6) shall be sold for cash at, above or below par and at a price that results in a net effective interest rate that conforms to the Public Securities Act; and

(7) may be sold at public or negotiated sale.

D. Subject to the approval of the state board of finance, the authority may enter into other financial arrangements if it determines that the arrangements will assist the authority."

SECTION 8. Section 58-31-14 NMSA 1978 (being Laws 2005, Chapter 128, Section 14) is amended to read:

"58-31-14. SPACEPORT AUTHORITY REFUNDING BONDS--ESCROW.--

A. Refunding bonds issued pursuant to the Spaceport Development Act shall be authorized by resolution of the authority. Any bonds that are refunded under the provisions of this section shall be paid at maturity or on any permitted prior redemption date in the amounts, at the time and places and, if called prior to maturity, in accordance with any applicable notice provisions, all as provided in the proceedings authorizing the issuance of the refunded bonds or otherwise pertaining thereto, except for any such bond that is voluntarily surrendered for exchange or payment by the holder or owner.

B. Provision shall be made for paying the bonds refunded at the time provided in this section. The principal amount of the refunding bonds may [exceed the principal amount of the refunded bonds and may also] be less than or the same as the principal amount of the bonds being refunded; provided that provision is duly and sufficiently made for payment of the refunded bonds.

C. The proceeds of refunding bonds, including any accrued interest and premium pertaining to the sale of refunding bonds, shall either be immediately applied to the retirement of the bonds being refunded or be placed in escrow in a commercial bank or trust company that possesses and is exercising trust powers and that is a member of the federal deposit insurance corporation, to be applied to the payment of the principal of, interest on and any prior redemption premium due in connection with the bonds being refunded; provided that such refunding bond proceeds, including any accrued interest and any premium pertaining to a sale of refunding bonds, may be applied to the establishment and maintenance of a reserve fund and to the payment of expenses incidental to the refunding and the issuance of the refunding bonds, the interest thereon, the principal thereof or both interest and principal as the authority may determine. Nothing in this section requires the establishment of an escrow if the refunded bonds become due and payable within one year from the date of the refunding bonds and if the amounts necessary to retire the refunded bonds within that time are deposited with the paying agent for the refunded bonds. Any such escrow shall not necessarily be limited to proceeds of refunding bonds but may include other money available for its purpose. Any proceeds in escrow pending such use may be invested or reinvested in bills, certificates of indebtedness, notes or bonds that are direct obligations of or the principal and interest of which obligations are unconditionally guaranteed by the United States or in certificates of deposit of banks that are members of the federal deposit insurance corporation. Such proceeds and investments in escrow, together with any interest or other income to be derived from any such investment, shall be in an amount at all times sufficient as to principal, interest, any prior redemption premium due and any charges of the escrow agent payable to pay the bonds being refunded as they become due at their respective maturities or due at any designated prior redemption date in connection with which the authority shall exercise a prior redemption option. Any purchaser of any refunding bond issued under the Spaceport Development Act is in no manner responsible for the application of the proceeds by the authority or any of its officers, agents or employees.

D. Refunding bonds may bear such additional terms and provisions as may be determined by the authority subject to the limitations in this section."

SECTION 9. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2016.

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