SENATE BILL 263
53rd legislature - STATE OF NEW MEXICO - second session, 2018
INTRODUCED BY
Carlos R. Cisneros
AN ACT
RELATING TO TAXATION; IMPOSING THE STATE GROSS RECEIPTS TAX ON A NONPROFIT HOSPITAL; IMPOSING THE GOVERNMENTAL GROSS RECEIPTS TAX ON A GOVERNMENT HOSPITAL; PROVIDING THAT THE NET GOVERNMENTAL GROSS RECEIPTS ATTRIBUTABLE TO GOVERNMENT HOSPITALS SHALL BE DISTRIBUTED TO THE GENERAL FUND; AMENDING AND REPEALING A DISTRIBUTION AND TAX CREDIT RELATED TO HOSPITALS; MAKING APPROPRIATIONS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. Section 7-1-6.4 NMSA 1978 (being Laws 1983, Chapter 211, Section 9, as amended) is amended to read:
"7-1-6.4. DISTRIBUTION--MUNICIPALITY FROM GROSS RECEIPTS TAX.--
A. Except as provided in Subsection B of this section, a distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to each municipality in an amount, subject to any increase or decrease made pursuant to Section 7-1-6.15 NMSA 1978, equal to the product of the quotient of one and two hundred twenty-five thousandths percent divided by the tax rate imposed by Section 7-9-4 NMSA 1978 multiplied by the net receipts, except net receipts attributable to a nonprofit hospital licensed by the department of health, for the month attributable to the gross receipts tax from business locations:
(1) within that municipality;
(2) on land owned by the state, commonly known as the "state fairgrounds", within the exterior boundaries of that municipality;
(3) outside the boundaries of any municipality on land owned by that municipality; and
(4) on an Indian reservation or pueblo grant in an area that is contiguous to that municipality and in which the municipality performs services pursuant to a contract between the municipality and the Indian tribe or Indian pueblo if:
(a) the contract describes an area in which the municipality is required to perform services and requires the municipality to perform services that are substantially the same as the services the municipality performs for itself; and
(b) the governing body of the municipality has submitted a copy of the contract to the secretary.
B. If the reduction made by Laws 1991, Chapter 9, Section 9 to the distribution under this section impairs the ability of a municipality to meet its principal or interest payment obligations for revenue bonds outstanding prior to July 1, 1991 that are secured by the pledge of all or part of the municipality's revenue from the distribution made under this section, then the amount distributed pursuant to this section to that municipality shall be increased by an amount sufficient to meet any required payment, provided that the distribution amount does not exceed the amount that would have been due that municipality under this section as it was in effect on June 30, 1992.
C. 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 municipality pursuant to the Tax Increment for Development Act."
SECTION 2. Section 7-1-6.38 NMSA 1978 (being Laws 1994, Chapter 145, Section 1, as amended) is amended to read:
"7-1-6.38. DISTRIBUTION--GOVERNMENTAL GROSS RECEIPTS TAX.--
A. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made in amounts equal to the following percentages of the net receipts attributable to the governmental gross receipts tax, less the net receipts attributable to a hospital licensed by the department of health:
(1) seventy-five percent to the public project revolving fund administered by the New Mexico finance authority; [in an amount equal to seventy-five percent of the net receipts attributable to the governmental gross receipts tax.
B. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made]
(2) twenty-four percent to the energy, minerals and natural resources department [in an amount equal to twenty-four percent of the net receipts attributable to the governmental gross receipts tax]; provided that forty-one and two-thirds percent of the distribution is appropriated to the energy, minerals and natural resources department to implement the provisions of the New Mexico Youth Conservation Corps Act and fifty-eight and one-third percent of the distribution is appropriated to the energy, minerals and natural resources department for state park and recreation area capital improvements, including the costs of planning, engineering, design, construction, renovation, repair, equipment and furnishings; and
[C. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made]
(3) one percent to the [office of] cultural affairs [in an amount equal to one percent of the net receipts attributable to the governmental gross receipts tax] department for capital improvements at state museums and monuments administered by the [office of] cultural affairs department.
[D.] B. The state pledges to and agrees with the holders of any bonds or notes issued by the New Mexico finance authority or by the energy, minerals and natural resources department and payable from the net receipts attributable to the governmental gross receipts tax distributed to the New Mexico finance authority or the energy, minerals and natural resources department pursuant to this section that the state will not limit, reduce or alter the distribution of the net receipts attributable to the governmental gross receipts tax to the New Mexico finance authority or the energy, minerals and natural resources department or limit, reduce or alter the rate of imposition of the governmental gross receipts tax until the bonds or notes together with the interest thereon are fully met and discharged. The New Mexico finance authority and the energy, minerals and natural resources department are authorized to include this pledge and agreement of the state in any agreement with the holders of the bonds or notes."
SECTION 3. Section 7-9-4.3 NMSA 1978 (being Laws 1991, Chapter 8, Section 2, as amended by Laws 1993, Chapter 332, Section 1 and by Laws 1993, Chapter 352, Section 1) is amended to read:
"7-9-4.3. IMPOSITION AND RATE OF TAX--DENOMINATION AS "GOVERNMENTAL GROSS RECEIPTS TAX".--For the privilege of engaging in certain activities by governments, there is imposed on every agency, institution, instrumentality or political subdivision of the state, except any school district [and any entity licensed by the department of health that is principally engaged in providing health care services], an excise tax of five percent of governmental gross receipts. The tax imposed by this section shall be referred to as the "governmental gross receipts tax"."
SECTION 4. Section 7-9-29 NMSA 1978 (being Laws 1970, Chapter 12, Section 3, as amended) is amended to read:
"7-9-29. EXEMPTION--GROSS RECEIPTS TAX--CERTAIN ORGANIZATIONS.--
A. Exempted from the gross receipts tax are the receipts of organizations that demonstrate to the department that they have been granted exemption from the federal income tax by the United States commissioner of internal revenue as organizations described in Section 501(c)(3) of the United States Internal Revenue Code of [1954] 1986, as that section may be amended or renumbered, except as provided in Subsection B of this section.
B. Exempted from any local option gross receipts tax, but not the state gross receipts tax, are receipts of an organization that is a hospital licensed by the department of health that demonstrates to the department that it has been granted exemption from the federal income tax by the United States commissioner of internal revenue as an organization described in Section 501(c)(3) of the United States Internal Revenue Code of 1986, as that section may be amended or renumbered.
[B.] C. Exempted from the gross receipts tax are the receipts from carrying on chamber of commerce, visitor bureau and convention bureau functions of organizations that demonstrate to the department that they have been granted exemption from the federal income tax by the United States commissioner of internal revenue as organizations described in Section 501(c)(6) of the United States Internal Revenue Code of [1954] 1986, as that section may be amended or renumbered.
[C.] D. This section does not apply to receipts derived from an unrelated trade or business as defined in Section 513 of the United States Internal Revenue Code of [1954] 1986, as that section may be amended or renumbered."
SECTION 5. Section 7-9-73.1 NMSA 1978 (being Laws 1991, Chapter 8, Section 3, as amended) is amended to read:
"7-9-73.1. DEDUCTION--GROSS RECEIPTS--GOVERNMENTAL GROSS RECEIPTS--HOSPITALS.--
A. Fifty percent of the receipts of hospitals licensed by the department of health may be deducted from gross receipts; provided that this deduction may be applied only to the taxable gross receipts remaining after all other appropriate deductions have been taken.
B. Fifty percent of the receipts of a hospital licensed by the department of health may be deducted from governmental gross receipts; provided that this deduction may be applied only to the taxable governmental gross receipts remaining after all other appropriate deductions have been taken.
C. A taxpayer allowed a deduction pursuant to this section shall report the amount of the deduction separately in a manner required by the department.
D. The department shall compile an annual report on the deductions provided by this section that shall include the number of taxpayers that claimed the deductions, the aggregate amount of deductions claimed and any other information necessary to evaluate the effectiveness of the deductions. The department shall present the report to the revenue stabilization and tax policy committee and the legislative finance committee with an analysis of the cost of the deductions."
SECTION 6. REPEAL.--Sections 7-1-6.57 and 7-9-96.1 NMSA 1978 (being Laws 2007, Chapter 361, Sections 1 and 7) are repealed.
SECTION 7. APPROPRIATIONS--HEALTH PROVIDER FUNDING.--
A. Twenty million dollars ($20,000,000) is appropriated from the general fund to the medical assistance division of the human services department for expenditure in fiscal year 2019 to increase inpatient and outpatient medicaid provider reimbursement rates for hospitals. Any unexpended or unencumbered balance remaining at the end of fiscal year 2019 shall revert to the general fund.
B. Six million dollars ($6,000,000) is appropriated from the general fund to the medical assistance division of the human services department for expenditure in fiscal year 2019 to increase medicaid provider reimbursement rates for enhanced rural hospitals. Any unexpended or unencumbered balance remaining at the end of fiscal year 2019 shall revert to the general fund.
C. Nine million five hundred thousand dollars ($9,500,000) is appropriated from the general fund to the medical assistance division of the human services department for expenditure in fiscal year 2019 to increase medicaid provider reimbursement rates for physicians. Any unexpended or unencumbered balance remaining at the end of fiscal year 2019 shall revert to the general fund.
D. Five million dollars ($5,000,000) is appropriated from the general fund to the board of regents of the university of New Mexico for expenditure in fiscal year 2019 to fund medical residencies at hospitals. Any unexpended or unencumbered balance remaining at the end of fiscal year 2019 shall revert to the general fund.
E. Five million dollars ($5,000,000) is appropriated from the general fund to the medical assistance division of the human services department for expenditure in fiscal year 2019 to increase fee schedules for behavioral health providers. Any unexpended or unencumbered balance remaining at the end of fiscal year 2019 shall revert to the general fund.
F. One million dollars ($1,000,000) is appropriated from the general fund to the medical assistance division of the human services department for expenditure in fiscal year 2019 to fund behavioral health telehealth services. Any unexpended or unencumbered balance remaining at the end of fiscal year 2019 shall revert to the general fund.
G. Five million dollars ($5,000,000) is appropriated from the general fund to the higher education department for expenditure in fiscal year 2019 to fund health professional loan repayment programs. Any unexpended or unencumbered balance remaining at the end of fiscal year 2019 shall revert to the general fund.
SECTION 8. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2018.
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