February 17, 1999

Mr. President:

Your JUDICIARY COMMITTEE, to whom has been referred

has had it under consideration and reports same with recommendation that it DO PASS, amended as follows:

1. On page 14, between lines 18 and 19, insert the following new section:

"Section 6. Section 6-21-21 NMSA 1978 (being Laws 1992, Chapter 61, Section 21, as amended) is amended to read:

"6-21-21. MONEY OF THE AUTHORITY--EXPENSES--AUDIT--

ANNUAL REPORT.--

A. All money of the authority, except as otherwise authorized or provided in the New Mexico Finance Authority Act or in a bond resolution, trust indenture or other instrument under which bonds are issued, shall be deposited as soon as practical in a separate account or accounts in banks or trust companies organized under the laws of this state. All deposits of money shall be secured, if required by the authority, in such a manner as the authority determines to be prudent. Banks or trust companies are authorized to give security for deposits of the authority.

B. Subject to the provisions of any contract with bondholders, the authority shall prescribe a system of accounts.

C. Money held by the authority that is not needed for immediate disbursement, including [any funds] money held in reserve, may be deposited with the state treasurer for short-term investment

pursuant to Section 6-10-10.1 NMSA 1978 or may be invested in direct and general obligations of or obligations fully and unconditionally guaranteed by the United States, obligations issued by agencies of the United States, obligations of this state or any political subdivision of the state, interest-bearing time deposits, commercial paper issued by corporations organized and operating within the United States and rated "prime" quality by a national rating service, other investments permitted by Section 6-10-10 NMSA 1978 or as otherwise provided by the trust indenture or bond resolution, if the [funds are] money is pledged for or [secure] secures payment of bonds issued by the authority.

D. The authority shall have an audit of its books and accounts made at least once each year by the state auditor or by a certified public accounting firm whose proposal has been reviewed and approved by the state auditor. The cost of the audit shall be an expense of the authority. Copies of the audit shall be submitted to the governor and the New Mexico finance authority oversight committee and made available to the public.

E. The authority shall submit a report of its activities to the governor and to the legislature not later than December 1 of each year. Each report shall set forth a complete operating and financial statement covering its operations for that year and a complete list of qualified entities requesting loans from the public project revolving fund during the preceding year whose requests were denied because the qualified entities lacked the financial resources to repay a loan."".

2. Renumber the succeeding section accordingly.

Respectfully submitted,

__________________________________

Cisco McSorley, Vice Chairman

Adopted_______________________ Not Adopted_______________________

(Chief Clerk) (Chief Clerk)

Date ________________________

The roll call vote was 5 For 0 Against

Yes: 5

No: None

Excused: Aragon, Sanchez, Stockard

Absent: None

S0080JU1 .127756.1