2021 Municipal Day Legislation

HOUSE BILLS

HB 4 NM CIVIL RIGHTS ACT (, , Joseph Cervantes & Patricia Roybal Caballero) The House passed the House Judiciary Committee Substitute as amended on the House Floor this week, yet it still remains a chiefly-punitive measure without effect as to the behavior giving rise to risk, and as a result leaves significant gaps in our state for law enforcement training. The language in the substitute introduces a $2M cap, but limits the cap to each claim, allowing for multiple plaintiffs to leverage a shared event to stack the caps, or a singular plaintiff to use an individual occurrence to accomplish the same result via alleging multiple claims therein. [1] HSEIC/HJC-HSEIC [2] DP-HJC- DNP-CS/DP [4] fl/a- PASSED/H (39-29) [6] SHPAC/SJC-SHPAC

HB 11 GRT & PERMANENT FUND FOR LEDA PROJECTS ( & Brian Egolf) The House Taxation and Revenue Committee substitute for House Bill 11 expands the Local Economic Development Act (LEDA) in two ways and makes a $200 million one- time appropriation from the general fund to the renamed “local economic development recovery act fund” (the “LEDA fund,” previously the “local and regional economic development support fund”) for grants to certain businesses, to be administered by the Economic Development Department (EDD) and the New Mexico Finance Authority (NMFA). The Senate Finance Committee amendment to the House Taxation and Revenue Committee substitute for House Bill 11 makes significant changes to the bill. These changes include: • Removes the bill’s permanent changes to the Local Economic Development Act (LEDA) that would have allowed for state and gross receipts tax sharing for certain projects with construction costs greater than $350 million. By removing the permanent GRT-sharing provisions for certain LEDA projects, the SFC amendment address LFC’s concern that changes to tax expenditures should be fully vetted before approved. • Requires the economic decline for eligibility of the bill’s recovery grants be measured on a quarterly basis rather than an annual basis. • Provides for NMFA to issue recovery grants in multiple application rounds and requires the authority to prioritize applications demonstrating the largest revenue decline. • Requires businesses to demonstrate a net increase in the number of full-time employees relative to the immediately preceding quarter to qualify for recovery grants. • Eliminates the original bill’s exception to the Inspection of Public Records Act (IPRA) for recovery grants awarded. [2] HCEDC/HTRC-HCEDC- DP/a-HTRC- HTRC- DNP-CS/DP - ref HAFC-HAFC [3] w/drn - PASSED/H (51-16) [5] SFC-SFC [6] DP/a [8] fl/a- PASSED/S (41-1) [6] h/cncrd 1 HB 50 PRIVATE RIGHT OF ACTION FOR CERTAIN STATUTES (Georgene Louis) HB50 proposes to create a private right of action for individuals pursuing enforcement of the Oil and Gas Act, Air Quality Control Act, Hazardous ®Waste Act, Solid Waste Act, and the Water Quality Act (acts). Persons who are injured or imminently threatened with injury, economically or otherwise, would be able to commence a civil action against another person alleging a past or present violation pursuant to those acts. The suits could not be filed until the plaintiff has given 60-days’ notice to the appropriate regulatory entity, the attorney general and the alleged violator, unless the alleged violation constitutes an immediate threat to the health, safety or legal interest of the plaintiff. The respective regulatory agencies and the attorney general would be able to intervene as a matter of right in such actions. Likewise, if a regulatory agency is already prosecuting a civil. Once an action is brought, the plaintiff must serve a copy of the complaint on the appropriate regulatory agency and attorney general. The bill states that no decree or judgment may be entered in the action unless the agency is a party, or the plaintiff has provided a copy of the proposed decree or judgment to the agency who has 45 days to comment on the proposed settlement or decree. The House Judiciary Committee amended the bill to clarify that any person who is injured may bring an action against another person who is subject to the Oil and Gas Act, Air Quality Control Act, Hazardous Waste Act, Solid Waste Act, and the Water Quality Act HPREF [1] HENRC/HJC-HENRC [2] DP/a-HJC.

HB 65 INCREASE CERTAIN PERA CONTRIBUTIONS (William Rehm) HB 65 provides for continued employee contribution increases over what was passed in 2020. House Bill 65 (HB 65) amends the PERA Act’s statutory employee contribution rates, allows members who work in excess of 90 percent of final average salary at a reduced pension multiplier and lowers eligibility for and changes cost-of-living adjustments.

The increases are made on the employee and will thus not have a direct impact on state expenditures. However, local governments, counties and municipalities, often cover a portion of employee contributions required by statute. Section 10-11-5 NMSA 1978 allows municipal affiliated employers to pay up to 75 percent of employees’ member contributions. Should HB65 be enacted, local government employers will likely face increased costs as they pick up a portion of the increased employee contribution.

Increasing employee contributions will reduce employee take home pay and may be a disincentive to government employment. Additionally, municipalities which offer pension “pickups” will need to evaluate the compensation package and determine if they will continue paying employee contributions at the same rate. [1] HLVMC/HAFC-HLVMC (Bill has been tabled in HLVMC)

HB 92 SAFE DRINKING WATER TESTING FUND ( & Susan Herrera) House Bill 92 changes the fee amount charged on public water supply systems from $0.03 per thousand gallons of water produced to $0.05 per thousand gallons of water produced. The bill changes the name of the fee to the safe drinking water testing fee and changes the name of the fund in which the fee revenue is deposited to the safe drinking water testing fund (previously the water conservation fee and water conservation fund, respectively).

2 • Money in the safe drinking water testing fund is to be used by the Environment Department (NMED) to test public water supplies for drinking water contaminants as identified by the federal Safe Drinking Water Act (SDWA) and rules promulgated by the department. • Prohibits NMED from using these funds for any required increase in sampling and analysis services resulting from SDWA or state rule violations. In such cases, HB92 stipulates the public water system in violation is responsible for the collection, analysis, and expenses of those samples and must provide the results of the analysis to NMED. • NMED estimates the fee increase required by HB92 would generate an additional $1.4 million per year, which would support the agency’s drinking water testing program that provides sampling and analysis services to public water systems. • The additional revenue generated by HB92’s enactment would support the testing services that ensure New Mexicans have access to safe drinking water. HPREF [1] HAWC/HTRC-HAWC [2] DP-HTRC [3] DP [6] PASSED/H (49-17) [8] SCONC/STBTC-SCONC

HB 97 LOCAL GOVERNMENT TOBACCO PRODUCTS SALES ORDINANCES ( & Elizabeth Thomson) SB 95 House Bill 97 amends the Tobacco Products Act (Section 61-37-24 NMSA 1978) to include a provision that would allow counties and municipalities to enact ordinances, charter amendments, or other tobacco regulations that are stricter than, but not in conflict with, the provisions of the Tobacco Products Act. • The significant issue in this bill is that it specifically addresses the issue of state preemption of local ability to act in the arena of tobacco regulation. Current law specifically mandates that if municipalities, including home rule municipalities enact any measure concerning the sale tobacco products that the measure enacted by the municipality be consistent with the state Tobacco Products Act. Enactment of this bill will remove the consistency requirement and put in its place a prohibition that any enactment not be in conflict with state law. • The bill would allow local communities to develop tobacco ordinances and regulations that address unique characteristics of tobacco use in that community. HPREF [1] HHHC/HLLC-HHHC [2] DP-HLLC

HB 268 CORONAVIRUS & WORKERS’ COMP (Dayan Hochman-Vigil, Christine Chandler, and ) House Bill 268 (HB 268) amends Section 52-1-19 NMSA 1978 of the Workers’ Compensation Act to create the rebuttable presumption that contraction of Covid-19 by an essential employee is an injury arising by accident out of and in the course of employment, provided the employee can establish that the employer has not strictly complied with the existing public health orders. An essential worker is defined as any public safety employee or school employee or an employee declared to be an essential employee pursuant to a public health order of the governor or the Secretary of Health. The employer may rebut the presumption by a preponderance of the evidence that the worker substantially violated a public health order related to Covid-19. Section 2 prohibits insurers from using Covid-19 claims arising in the course of employment in developing rating plans. [2] HLVMC/HSEIC-HLVMC [6] DP/a-HSEIC

3 SENATE BILLS

SB 20 TRANSPORTATION PROJECT FUND () Senate Bill 20 changes the distribution of 18.75 percent of the motor vehicle excise tax revenue collected from the local government road fund to the transportation project fund. The bill does not make any other changes to the amount or distribution of motor vehicle excise tax revenue. The bill will create a recurring source of revenue to the transportation project fund. TRD estimates this revenue stream to be $41.1 million in FY22, growing to $42.5 million in FY22. • Revenue credited to the Local Governments Road Fund is distributed to the enumerated entities based on a statutorily created formula. Fund distribution is not based on needs and often results in some of the dedicated funds not being distributed during a particular fiscal year. Preference is given to entities who are able to contribute a match up to 25 percent of the project cost. • Distributions from the Transportation Project Fund is a competitive process based on need. Entities are only required to submit a 5 percent match with the ability to obtain a waiver of that match amount upon a showing of financial hardship. • The local Government Roads fund has more restrictive uses and high local match requirements than the Transportation Project Fund. [1] STBTC/SFC-STBTC [3] DP-SFC [8] DP

SB 26 GROSS RECEIPTS TAX DEDUCTION FOR DATA CENTERS () Senate Bill 26 creates gross receipts tax and compensating tax deductions for new or largely reconstructed large data centers. The Economic Development Department (EDD) is required to certify the eligibility for a data center nontaxable transaction certificate (NTTC). An eligible data center is a new or largely reconstructed data center for which the taxpayer and one or more other taxpayers expend $25 million in eligible costs. (Note: the taxpayer claiming the deduction is not the data center, but the recipient of a data center NTTC.) • The bill also proposes a property tax abatement for all data centers, including existing data centers currently receiving property tax abatements pursuant to an IRB deal. In lieu of the total property tax abatement for a period of up to 30 years pursuant to approval of an Industrial Revenue Bond IRB, or the declining abatement in last year’s bill, this bill provides for a permanent special method of valuation that is set at 5 percent of initial costs. • The bill might not significantly decrease state or local revenues below the levels already anticipated with current data centers in the state, but the bill could prevent future revenues the state and local governments would otherwise receive. The bill expands the limits of what would be considered tangible personal property exempt from property taxes and deductible under industrial revenue bonds (IRBs) using current statute and determinations by TRD and the Administrative Hearings Office. [1]STBTC/SFC-STBTC

SB 39 NAMES OF FINALISTS FOR EXECUTIVE POSITIONS (Bill Tallman) Senate Bill 39 relates to public records and requires publication of the names and resumes of at least three finalists for appointed executive positions other than political appointments, including cabinet secretaries. The names and resumes are to be posted for

4 at least 10 days before a selection is made. SB39 exempts applicants from public record inspection prior to being selected as a finalist. The bill exempts medical and psychological records of published finalists from public record inspection. [1] SHPAC/SJC-SHPAC [3] DP-SJC

SB 49 USES OF LOCAL ECONOMIC DEVELOPMENT FUNDING (Pat Woods, Elizabeth Stefanics, and ) The Senate Tax, Business and Transportation Committee (STBTC) substitute for Senate Bill 49 amends the Local Economic Development Act (LEDA). Amendments include changing the definition of retail business, removing the non-compete clause for retail businesses, expanding opportunities for a municipality to join in to a project participation agreement with the Department of Economic Development and includes that a project participation agreement can occur within the unincorporated portion of a county, rather than ten miles from the closest municipality with a population greater than fifteen thousand according to the most recent federal decennial census. [1] SHPAC/STBT-SHPAC [3] DNP-CS/DP-STBTC [5] DNP-CS/DP [6] ref SFC-SFC

SB 64 FEDERALLY INSURED OBLIGATIONS () Senate Bill 64 proposes a technical amendment to NMSA 1978, Section 6-10-10(F) (3) by removing the phrase “registry service” and replacing it with the phrase “placement services.” Counties and municipalities would be authorized to invest funds in “certificate of deposit account placement services.” • Currently, Section 6-10-10(F) (3) NMSA 1978 references the certificate of deposit account registry service (CDARS), which is a for-profit service that breaks up large deposits and places them across a network of more than 3,000 banks and savings associations. SB64 would replace that language to reference a generic service – a certificate of deposit account placement service – providing greater flexibility to county and municipal treasurers. [1] SHPAC/STBT-SHPAC [3] DP-STBTC [5] DP

SB 72 ELECTRIC GENERATION PROJECT REQUIREMENTS () HB 105 SB 72 provides for IRB treatment for electric transmission and generating facilities and provided for in-lieu of property tax sharing for the state and various school districts. • The bill further amends the municipal IRB statute (3-32-6.2 NMSA 1978) and the county IRB statute (4-59-4 NMSA 1978) to establish a formula to share negotiated in-lieu of property tax payments between the IRB sponsoring jurisdiction (generally County governments) and the school districts within that sponsoring jurisdiction and proposes that all school districts located within the county or municipal jurisdictions would share the formula amount of sharing equally. • The STBTC committee adopted technical amendments to the bill. [1] STBTC/SFC-STBTC [5] DP/a-SFC

SB 88 PUBLIC PROJECT REVOLVING FUND PROJECTS () Senate Bill 88 authorizes the New Mexico Finance Authority (NMFA) to provide loans from the public project revolving fund (PPRF) to 146 separate state and local government entities based on terms and conditions established by NMFA. • The bill voids legislative authorization if a qualified entity does not notify NMFA by the end of the fiscal year 2024 of its intent to pursue a loan from the NMFA.

5 • The bill does not appropriate funds but may reduce borrowing costs to qualified entities because they would receive competitive market-driven interest rates through the PPRF program. [1] SCONC/SFC-SCONC [3] DP-SFC [8] DP

SB 261 COVID PRESUMPTION FOR FIREFIGHTERS (George Munoz) SB 261 amends section 52-3-32.1 that relates to occupational conditions for firefighters. Under this section, “firefighter” means a person who is employed as a full-time non- volunteer firefighter by the state or a local government entity and who has taken the oath prescribed for firefighters.

Under the bill, if a firefighter is diagnosed with a virus or disease that has been declared a pandemic by the president of the United States, the , the world health organization or the federal centers for disease control and prevention, including the coronavirus disease and other future qualifying pandemics, and the condition was not revealed during an initial employment medical screening examination the condition is presumed to be proximately caused by employment as a firefighter.

The law requires employment as a firefighter for a stated period of time prior to the diagnosis of the condition for that condition to be presumed to be proximately caused by employment as a firefighter. There is no such “waiting period” for a virus or disease that has been declared a pandemic. [3] SHPAC/SJC-SHPAC

SB 268 CHANGE AUDIT REPORTING REQUIREMENTS (Harold Pope) Senate Bill 268 adds language that confidential audit documentation, including working papers, are not public records of the state and shall not be subject to the provisions of IPRA. The bill removes the thirty-day notification of any errors in the report by the agency auditing and adds any revisions of a report that is a public record shall comply with generally accepted auditing standards. [3] SHPAC/SJC-SHPAC

SB 375 OFFICER TRAINING & CERTIFICATION (George Munoz & ) Senate Bill 375 adds specific medical services training requirements be included in the basic law enforcement training class that include: crisis management and intervention; dealing with individuals who are experiencing mental health issues; methods of de- escalation; peer-to-peer intervention; stress management; and racial sensitivity. • Similar requirements are imposed on the State Fire Marshal training programs. • The bill restructures the Law Enforcement Academy Board. It drops the requirement that one member of the Board be a municipal police chief. • Creates the "law enforcement certification board" which is administratively attached to the department of public safety as an independent board. • The Board shall have the power to issue, deny, renew, suspend or revoke a peace officer's certification for just cause as provided in the Law Enforcement Training Act; and issue, deny, renew, suspend or revoke telecommunicator’s certification for just cause as provided in the Public Safety Telecommunicator Training Act. [5] SJC/SFC-SJC

6 SB 376 PROHIBIT DEFENSE OF QUALIFIED IMMUNITY (Joseph Cervantes) SB 376 specifically eliminates the defense of Qualified Immunity and the common law good faith defense from actions brought under the NM Tort Claims Act. • The bill also provides for a mandatory award of attorney’s fees and reasonable litigation expenses in any successful action or proceeding. • The bill would create a new 3-year statute of limitations. • The bill would also increase the maximum recovery or “caps” under the Tort Claims Act:  Property damage from $200K to $500K  Medical Expenses from $300K to $800K  Per Person Claim from $400K to $1.2M. (Non-property/non-medical claims)  Per Occurrence from $750K to $2M • Creates a cost-of-living escalator of the consumer price index for all urban consumers, United States city average. [5] SHPAC/SJC-SHPAC

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