SENATE TAX, BUSINESS AND TRANSPORTATION
COMMITTEE SUBSTITUTE FOR
SENATE BILL 321
55th legislature - STATE OF NEW MEXICO - first session, 2021
AN ACT
RELATING TO COURTS; ENACTING THE COUNTY COURTHOUSE BONDING ACT; AUTHORIZING THE NEW MEXICO FINANCE AUTHORITY TO ISSUE COUNTY COURTHOUSE TAX REVENUE BONDS; CREATING THE COUNTY COURTHOUSE BONDING FUND; CREATING THE COUNTY COURTHOUSE GRANT FUND; PROVIDING FOR GRANTS TO CERTAIN COUNTIES FOR COURTHOUSE PROJECTS; PROVIDING A TAX DISTRIBUTION TO THE COUNTY COURTHOUSE BONDING FUND.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. [NEW MATERIAL] SHORT TITLE.--Sections 1 through 6 of this act may be cited as the "County Courthouse Bonding Act".
SECTION 2. [NEW MATERIAL] NEW MEXICO FINANCE AUTHORITY--BUILDING BONDS--PROCEEDS.--The New Mexico finance authority is authorized to issue and sell revenue bonds, known as "county courthouse tax revenue bonds", payable solely from the county courthouse bonding fund, in compliance with the County Courthouse Bonding Act for the purpose of remodeling, renovating or constructing courthouses, including the purchase of equipment and furnishings but excluding the purchase of land or buildings; provided that state funding shall be expended only for courtrooms and court-related facilities in counties that meet the requirements set by the authority pursuant to the County Courthouse Bonding Act. The net proceeds from the county courthouse tax revenue bonds shall be appropriated to the county courthouse grant fund.
SECTION 3. [NEW MATERIAL] COUNTY COURTHOUSE BONDING FUND--CREATED--MONEY IN THE FUND PLEDGED.--
A. The "county courthouse bonding fund" is created as a special fund within the New Mexico finance authority. The fund shall be administered by the New Mexico finance authority as a special account. The fund shall consist of money appropriated and transferred to the fund and gross receipts tax revenues distributed to the fund pursuant to Section 8 of the County Courthouse Bonding Act. Earnings of the fund shall be credited to the fund. Balances in the fund at the end of any fiscal year shall remain in the fund, except as provided in this section.
B. Money in the county courthouse bonding fund is pledged for the payment of principal and interest on all county courthouse tax revenue bonds issued pursuant to the County Courthouse Bonding Act. Money in the fund is appropriated to the New Mexico finance authority for the purpose of paying debt service on the county courthouse tax revenue bonds and the expenses incurred in the issuance, payment and administration of the bonds.
C. Any balance remaining in the county courthouse bonding fund shall be transferred to the general fund upon certification by the New Mexico finance authority that:
(1) the local government division of the department of finance and administration, the New Mexico finance authority and the administrative office of the courts have agreed that the county courthouse tax revenue bonds issued pursuant to the County Courthouse Bonding Act have been retired, that no additional obligations of the county courthouse bonding fund exist and that no additional expenditures from the fund are necessary; or
(2) a court of proper jurisdiction has ruled that the county courthouse tax revenue bonds have been retired, that no additional obligations of the county courthouse bonding fund exist and that no additional expenditures from the fund are necessary.
D. The county courthouse tax revenue bonds issued pursuant to the County Courthouse Bonding Act shall be payable solely from the county courthouse bonding fund or, with the approval of the bondholders, such other special funds as may be provided by law and do not create an obligation or indebtedness of the state within the meaning of any constitutional provision. No breach of any contractual obligation incurred pursuant to that act shall impose a pecuniary liability or a charge upon the general credit or taxing power of the state, and the bonds are not general obligations for which the state's full faith and credit are pledged.
SECTION 4. [NEW MATERIAL] COURTHOUSE BONDS--AGREEMENT OF THE STATE.--
A. The state does hereby pledge to and agree with the holders of any bonds or notes issued under the County Courthouse Bonding Act that the state will not limit or alter the rights hereby vested in the authority to fulfill the terms of any agreements made with the holders thereof or in any way impair the rights and agreements made with the holders thereof or in any way impair the rights and remedies of those holders until the bonds or notes together with the interest thereon, with interest on any unpaid installments or interest, and all costs and expenses in connection with any action or proceedings by or on behalf of those holders, are fully met and discharged. The New Mexico finance authority is authorized to include this pledge and agreement of the state in any agreement with the holders of the bonds or notes.
B. Any law authorizing the imposition, collection or distribution from the net receipts attributable to the gross receipts tax imposed by the Gross Receipts and Compensating Tax Act or that affects the tax shall not be amended, repealed or otherwise directly or indirectly modified so as to impair or reduce debt service coverage for any outstanding revenue bonds that may be secured by a pledge of those tax revenues, unless the revenue bonds have been discharged in full or provisions have been made for a full discharge.
C. The New Mexico finance authority may secure the county courthouse tax revenue bonds issued pursuant to this section by a pledge of money in the public project revolving fund with a lien priority on the money in the public project revolving fund as determined by the authority.
SECTION 5. [NEW MATERIAL] FULL AUTHORITY FOR THE ISSUANCE OF BONDS--BONDS AS LEGAL INVESTMENTS.--
A. The County Courthouse Bonding Act shall, without reference to any other act of the legislature, be full authority for the issuance and sale of county courthouse tax revenue bonds, which bonds shall have all the qualities of investment securities under the Uniform Commercial Code and shall not be invalid for any irregularity or defect or be contestable in the hands of bona fide purchasers or holders thereof for value.
B. County courthouse tax revenue bonds are legal investments for the public project revolving fund created in the New Mexico finance authority and any person or board charged with the investment of any public funds and are acceptable as security for any deposit of public money.
SECTION 6. [NEW MATERIAL] COUNTY COURTHOUSE GRANT FUND--CREATION--ADMINISTRATION--PURPOSES.--
A. There is created in the New Mexico finance authority the "county courthouse grant fund", which shall be administered by the authority. The authority shall adopt, in accordance with the New Mexico Finance Authority Act, rules necessary to administer the fund.
B. The following shall be deposited directly into the county courthouse grant fund:
(1) the net proceeds from the sale of bonds issued pursuant to the County Courthouse Bonding Act;
(2) money appropriated by the legislature to implement the provisions of this section; and
(3) any other public or private money dedicated to the fund.
C. Money in the county courthouse grant fund is appropriated to the authority to:
(1) make grants to qualified counties to remodel, renovate or construct courthouses, including equipment and furnishings, but excluding the purchase of land or buildings; provided that the grant shall be expended only for courtrooms and court-related facilities; and
(2) administer the provisions of this section.
D. The authority shall adopt rules governing the terms and conditions of grants made from the county courthouse grant fund. Grants shall be made from the fund only if the qualified county provides matching funding for a proposed project, which shall be in an amount equal to the grant. Grants from the county courthouse grant fund shall be made only after the authority has determined that the financing for the complete project is cost-effective.
SECTION 7. A new section of the Tax Administration Act is enacted to read:
"[NEW MATERIAL] DISTRIBUTION--GROSS RECEIPTS TAX--
COUNTY COURTHOUSE BONDING FUND.--Beginning July 1, 2021 and continuing monthly through June 30, 2026, a distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the county courthouse bonding fund in the amount of one million dollars ($1,000,000) from the net receipts attributable to the gross receipts tax imposed by the Gross Receipts and Compensating Tax Act."
SECTION 8. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2021.
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