0001|
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0002| HOUSE BILL 178
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0003| 43RD LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION, 1998
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0004| INTRODUCED BY
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0005| MAX COLL
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0006|
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0007|
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0008|
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0009|
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0010|
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0011| AN ACT
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0012| RELATING TO PUBLIC SCHOOL CAPITAL IMPROVEMENTS; ENACTING THE
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0013| PUBLIC SCHOOL CAPITAL EQUALIZATION ACT; AUTHORIZING THE
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0014| ISSUANCE OF SEVERANCE TAX BONDS FOR PUBLIC SCHOOL CAPITAL
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0015| PROJECTS; AMENDING, REPEALING AND ENACTING SECTIONS OF THE
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0016| NMSA 1978; MAKING AN APPROPRIATION.
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0017|
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0018| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
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0019| Section 1. [NEW MATERIAL] SHORT TITLE.--Sections 1
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0020| through 7 of this act may be cited as the "Public School
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0021| Capital Equalization Act".
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0022| Section 2. [NEW MATERIAL] FINDINGS AND PURPOSE.--
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0023| A. The legislature finds that, because of growth
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0024| rates, income levels, the presence or absence of natural
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0025| resources and other factors, a disparity exists between school
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0001| districts concerning their ability to finance public school
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0002| capital improvements. The legislature further finds that
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0003| there is no adequate remedy for the disparity under existing
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0004| law.
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0005| B. The purpose of the Public School Capital
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0006| Equalization Act is to equalize the funding for public school
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0007| capital improvements by providing an equitable procedure for
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0008| allocating state resources and by dedicating one-half of the
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0009| severance tax bonding capacity to public school capital
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0010| improvements.
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0011| Section 3. [NEW MATERIAL] DEFINITIONS.--As used in the
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0012| Public School Capital Equalization Act:
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0013| A. "capital project" means:
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0014| (1) constructing, renovating or purchasing
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0015| public school buildings; or
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0016| (2) purchasing or improving public school
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0017| grounds; and
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0018| B. "council" means the public school capital
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0019| outlay council.
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0020| Section 4. [NEW MATERIAL] PUBLIC SCHOOL CAPITAL
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0021| EQUALIZATION.--
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0022| A. A school district in need of funding for a
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0023| capital project may submit an application to the council.
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0024| Each application shall be in a form approved by the council
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0025| and shall include:
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0001| (1) a description of the capital project;
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0002| (2) an explanation of the need for the
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0003| capital project;
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0004| (3) a description of efforts used by
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0005| residents of the school district to meet the district's
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0006| capital outlay requirements;
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0007| (4) documentation showing how the school
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0008| district has used its financial resources;
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0009| (5) a calculation showing that the percentage
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0010| of the total debt authorized by law that the school district
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0011| has assumed is greater than fifty percent;
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0012| (6) a five-year facilities plan that includes
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0013| capital priorities and enrollment projections; and
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0014| (7) evidence that the school district can
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0015| meet any requirements for matching funds.
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0016| B. At least once each fiscal year the council
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0017| shall consider all complete applications at a public hearing
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0018| and prioritize the projects based upon the critical need for
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0019| each capital project.
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0020| Section 5. [NEW MATERIAL] LEVEL OF STATE FUNDING--
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0021| SCHOOL DISTRICT MATCH.--
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0022| A. For each capital project prioritized, the
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0023| council shall calculate the amount of the total capital
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0024| project cost that may be funded with severance tax bond
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0025| proceeds and the amount of the total capital project cost that
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0001| the school district shall be required to fund with its own
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0002| resources or with grant assistance pursuant to the Public
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0003| School Capital Outlay Act.
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0004| B. The percentage of the total capital project
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0005| cost that may be funded with severance tax bond proceeds shall
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0006| be calculated by subtracting one hundred from twice the
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0007| percentage of the total debt authorized by law that the school
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0008| district has assumed.
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0009| C. The school district shall match with its own
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0010| funds or with grant assistance pursuant to the Public School
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0011| Capital Outlay Act the portion of the total project cost not
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0012| funded by severance tax bond proceeds.
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0013| D. No capital project shall be funded in phases or
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0014| by installments. The total capital project cost shall include
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0015| an amount sufficient to complete the capital project.
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0016| Section 6. [NEW MATERIAL] SEVERANCE TAX BONDS--
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0017| APPROPRIATION OF PROCEEDS.--
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0018| A. After estimating the severance tax bonding
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0019| capacity available for capital projects, the council shall
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0020| allocate the capacity, in the prioritized order, to the
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0021| portion of the capital projects to be funded by severance tax
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0022| bond proceeds. When the council finds that the capital
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0023| projects have been developed sufficiently to justify the
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0024| issuance and that the capital projects can proceed to contract
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0025| within a reasonable time, the council shall, by resolution,
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0001| request severance tax bonds to be issued in the amount
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0002| necessary to fund the capital projects.
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0003| B. Unless prohibited by the provisions of Section
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0004| 7-27-14 NMSA 1978, the state board of finance shall issue and
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0005| sell severance tax bonds in compliance with the Severance Tax
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0006| Bonding Act in the amount requested by the council. The state
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0007| board of finance shall schedule the issuance and sale of the
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0008| bonds in the most expeditious and economical manner possible.
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0009| The state board of finance shall further take the appropriate
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0010| steps necessary to comply with the Internal Revenue Code of
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0011| 1986, as amended.
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0012| C. Proceeds from the sale of the bonds are
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0013| appropriated to the state department of public education for
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0014| the purpose of paying the portion of the capital projects to
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0015| be funded with the proceeds. Any unexpended or unencumbered
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0016| balance remaining after six months following the completion of
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0017| a capital project shall revert to the severance tax bonding
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0018| fund.
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0019| Section 7. [NEW MATERIAL] RULES.--The state department
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0020| of public education may adopt such rules as are necessary to
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0021| carry out the provisions of the Public School Capital
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0022| Equalization Act.
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0023| Section 8. A new Section 7-27-12.1 NMSA 1978 is enacted
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0024| to read:
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0025| "7-27-12.1. [NEW MATERIAL] BONDS TO BE ISSUED--
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0001| SPECIFIC AUTHORIZATION.--
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0002| A. Unless prohibited by the provisions of Section
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0003| 7-27-14 NMSA 1978, the state board of finance shall issue and
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0004| sell severance tax bonds when specifically authorized to do so
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0005| by a law that specifies the amount and purpose of the issue
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0006| and the recipient of the bond proceeds. The board shall issue
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0007| and sell the severance tax bonds only when so instructed by
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0008| resolution of the governing body of the recipient of the bond
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0009| proceeds.
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0010| B. The state board of finance shall also issue and
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0011| sell severance tax bonds authorized by Sections 72-14-36
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0012| through 72-14-42 NMSA 1978, and such authority as has been
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0013| given to the interstate stream commission to issue and sell
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0014| such bonds is transferred to the state board of finance."
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0015| Section 9. A new Section 7-27-12.2 NMSA 1978 is enacted
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0016| to read:
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0017| "7-27-12.2. [NEW MATERIAL] BONDS TO BE ISSUED--PUBLIC
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0018| SCHOOL CAPITAL EQUALIZATION ACT.--Unless prohibited by the
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0019| provisions of Section 7-27-14 NMSA 1978, the state board of
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0020| finance shall issue and sell severance tax bonds when
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0021| requested to do so by resolution of the public school capital
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0022| outlay council pursuant to the Public School Capital
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0023| Equalization Act."
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0024| Section 10. Section 7-27-14 NMSA 1978 (being Laws 1961,
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0025| Chapter 5, Section 11) is amended to read:
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0001| "7-27-14. AMOUNT OF TAX--SECURITY FOR BONDS.--
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0002| A. The legislature shall provide for the continued
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0003| assessment, levy, collection and deposit into the severance
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0004| tax bonding fund of the tax or taxes upon natural resource
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0005| products severed and saved from the soil of the state
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0006| [which] that, together with such other income as may be
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0007| deposited to the fund, will be sufficient to produce an amount
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0008| [which] that is at least the amount necessary to meet
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0009| annual debt service charges on all outstanding severance tax
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0010| bonds.
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0011| [B. The state board of finance shall issue no
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severance tax bonds unless the aggregate amount outstanding,
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including any severance tax bonds authorized prior to the
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enactment of this Severance Tax Bonding Act, but not yet
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issued, and including the issue proposed, can be serviced with
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not more than fifty percent of the annual deposits into the
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severance tax bonding fund, as determined by the deposits
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during the preceding fiscal year.]
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0019| B. The state board of finance shall issue no
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0020| severance tax bonds pursuant to Section 7-27-12.1 NMSA 1978
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0021| unless the aggregate amount outstanding for bonds issued
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0022| pursuant to that section, including the issue proposed, can be
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0023| serviced with not more than one-half of the difference
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0024| between:
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0025| (1) fifty percent of the annual deposits into
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0001| the severance tax bonding fund, as determined by the deposits
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0002| during the preceding fiscal year; and
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0003| (2) the amount needed during the current
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0004| fiscal year for any debt service remaining on those severance
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0005| tax bonds outstanding on July 1, 1998.
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0006| C. The state board of finance shall issue no
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0007| severance tax bonds pursuant to Section 7-27-12.2 NMSA 1978
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0008| unless the aggregate amount outstanding for bonds issued
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0009| pursuant to that section, including the issue proposed, can be
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0010| serviced with not more than one-half of the difference
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0011| between:
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0012| (1) fifty percent of the annual deposits into
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0013| the severance tax bonding fund, as determined by the deposits
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0014| during the preceding fiscal year; and
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0015| (2) the amount needed during the current
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0016| fiscal year for any debt service remaining on those severance
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0017| tax bonds outstanding on July 1, 1998.
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0018| [C.] D. The provisions of this section shall
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0019| not be modified by the terms of any bonds hereafter issued."
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0020| Section 11. TEMPORARY PROVISION.--All severance tax
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0021| bonds authorized, but not issued, before the effective date of
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0022| this act shall be issued pursuant to Section 7-27-12.1 NMSA
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0023| 1978.
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0024| Section 12. REPEAL.--Section 7-27-12 NMSA 1978 (being
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0025| Laws 1961, Chapter 5, Section 10, as amended) is repealed.
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0001| Section 13. EFFECTIVE DATE.--The effective date of the
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0002| provisions of this act is July 1, 1998.
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