2015 Legislature FOCUS REPORT FOCUS Report 2015

ACI Battled Partisanship in 2015 Legislature By Dr. Beverlee McClure ACI was successful in moving much sprint, and ACI President and CEO of our priority legislation forward in with our both the House and the Senate. members we The 2015 Legislative session was While many other associations strug- are equipped one of the most divisive and grid- gled to get their bills heard, ACI’s to continue locked in New Mexico history. extensive groundwork paid off. By working for Many in New Mexico’s businesses working closely with both chambers change in the community assumed that the new and with both D’s and R’s, ACI long haul. Republican-controlled House would fared better than most in navigating None of this mean new opportunities for business. the ugly partisanship that stalled oth- would be But in many ways, the newly divided er proposals this session. possible legislature only meant bad news. The And many ideas—right to work, im- without our members. partisanship and division was evident provements to unemployment insur- This year’s FOCUS report is a valua- on both sides, and the number of ance, headquarters incentives, and ble tool for you as a leader to evalu- bills that ultimately passed both others—came to the forefront this ate what happened this year and help houses was a record low. year and started conversations that us prepare for 2016. We look for- Still, there were many new opportu- will not end with the legislative ses- ward to hearing from you, and to nities for change this session, and sion. Only days since the closing working together in the year ahead ACI capitalized on these at every gavel, ACI is already working on for a stronger, more prosperous New turn. taking the lead and continuing the Mexico. As you will see in this year’s legisla- conversation in 2016. New Mexi- tive scorecard and bill summary, co’s future is a marathon, not a

Inside: 2015 Legislative Scorecard: ACI’s 2015 Legislative Scorecard 3-5 Here you can see how your legislator voted on the 29 bills Senate 3 tracked by ACI as FOCUS priorities. Because the major- ity of the action to kill or promote a bill happens in com- House 4-5 mittee, scores include both floor and committee votes. FOCUS on Committees 6-7 Keep in mind, ACI tracked hundreds of other bills during 2015 FOCUS Priority Bill Summary 8-12 the legislative session; FOCUS bills are selected as our FOCUS on the Issues key priorities and as indicators of friendliness to business. Anti-Business Legislation 12 Reading the Scorecard: The Budget 10 Legislators: (D/R) indicates party; (*) indicates a freshman. Capital Outlay 10 Bills in black type were supported by ACI. Independent Hearing Officers 8 Bills in red type were opposed by ACI. Procurement Reform 8 Vote supported by ACI Right to Work 13 Tax Package 13 Vote opposed by ACI Worker’s Compensation 14 Sponsorship supported by ACI 2015 Legislature by the Numbers 9 Sponsorship opposed by ACI FOCUS on the Governor 14 Position changed between committee and floor Bill Catalog 16-17 ACI Investors 18 e Excused– no vote cast How a Bill Becomes Law 15 a Absent– no vote cast

The Voice of New Mexico Business Page 2 Vol. XXV Vol. XXV ofVoiceThe MexicoNew Business Pat Woods (R Woods Pat (D Wirth Peter A.(R Lisa Torraco (D Stewart *Mimi Soules(D P. William Arthur (D John Smith Benny (D Jr. Shendo, (R Sharer E. William Sapien(D John M. Sanchez(DS. Michael (D Sanchez Clemente C. Ryan John (R (R Rue Sander Nancy (D Rodriguez (R R. Pirtle Cliff Pinto (D John Payne H. William (R Mary(D Kay Papen Padilla (D Michael y Ortiz Gerald Pino(D (D O'Neill B. Bill (R Neville StevenP. (D Munoz K. George C. (D Morales Howie (R Mark Moores McSorley Cisco (D C. (D Richard Martinez Lopez Linda M. (D (R Leavell H. Carroll Gay(R G.Kernan A. Daniel Ivey Ingle(R Stuart (R Griggs Ron A. Phil (D Griego Cotter S. (R Lee Cisneros (D R. Carlos (D Cervantes Joseph Candelaria (D Jacob Campos(D Pete Burt (R F. William (R Brandt W. Craig (R Beffort Wilson Sue

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FOCUS Scorecard 2015: Senate

HB75: RTW e e e

HB 130: RFP Reviews e e e e e e e

HB 238: Wkrs Comp/Intox. e e

HB 250: Return to Work

152: Health Security

SB 164: Job Training

SB 183: RTW e e

SB 194: Admin. Proc. Act.

SB 233: Temp. Disability a a

SB 356: Ind. Hearing Office e e e

SB 374: Enviro. Covenants

e e

SB 413: Angel Investment

e e e

SB 537: Sunshine Portal

e e e e

SB 553: Wkrs Comp/Intox.

ward (and are thus opposed by by opposed are thus ward (and for- bill which the moves dation, pass recommen- to without motion a were 152 SB on on Yes votes recorded. not was amendment that on business.Theon vote up- impact itsbecause negative of opposed that HB238 ACI ment to amend- an added Sen. Cervantes tee votes. commit- key well as committee, as in bills FOCUS on action taken pp.See 6 and Senate. House in the ion introduced bills compan- were andHB 238 553 SB the bill. over concern expressACI) butdo

- 7 for a full picture of of picture afor full 7

Page 3 Page

FOCUS Report 2015

FOCUS Scorecard 2015: House of Representatives

HB 130: RFP ReviewsRFP 130: HB HB 55/80: Project 55/80: HB Wages RTW HB75: Wkrs 238: HB Comp/Intox. Work Return 250: HB to HQ 286: HB Operations LEDA 312: HB 233: Temp.Disability SB 356: Hearing Ind. SB Office 537: Portal Sunshine SB *David E. Adkins (R-29) HB 312, funding for Eliseo Lee Alcon (D-6) LEDA, was ultimately *Deborah A. Armstrong included in the budget (R-8) a passed by the House and Senate and signed Paul C. Bandy (R-3) by the Governor (see Cathrynn N. Brown(R-55) page 10). (D-18) S. Clahchischilliage (R-4) Zachary J. Cook (R-56) a a HB 286 was tabled in *Randal S. Crowder(R-64) the House Ways and *Jim Dines (R-20) Means Committee, but was included in the Tax , Jr. (D-63) Package, SB 386. SB (D-47) 386 was created as a (R-59) tax package by the Candy Spence Ezzell House Ways and Means Kelly K. Fajardo (R-7) Committee. (see page David M. Gallegos (R-61) 13). Doreen Y. Gallegos(D-52) Miguel P. Garcia (D-14) e It is important to note S. Garcia Richard (D-43) a that HB 75 was brought Nate Gentry (R-30) for a floor vote with an *Bealquin Bill Gomez(D-34) amendment attached Roberto J. Gonzales (D-42) which proposed to in- Jimmie C. Hall (R-28) crease the statewide Dianne Miller Hamilton(R-38) e e minimum wage to $8 Jason C. Harper (R-57) an hour. Yvette Herrell (R-51) e Dona G. Irwin (D-32) a e e *Conrad James (R-24) *D. Wonda Johnson (D-5) Larry A. Larrañaga (R-27) Tim D. Lewis (R-60) *Rick Little (R-53) (D-26) (D-9)

The Voice of New Mexico Business Page 4 Vol. XXV FOCUS Report 2015

FOCUS Scorecard 2015: House of Representatives (continued)

HB75: RTW HB75: HB 55/80: Project 55/80: HB Wages RFP 130: HB Reviews Wkrs 238: HB Comp/Intox. Work Return 250: HB to HQ 286: HB Operations LEDA 312: HB 233: Temp.Disability SB 356: Hearing Ind. SB Office 537: Portal Sunshine SB James Roger Madalena (D-65) e e Antonio Maestas (D-16) *Sarah Maestas Barnes(R-15) *Stephanie Maez (D-21) e a W. Ken Martinez (D-69) e *Javier Martínez (D-11) Bill McCamley (D-33) Terry H. McMillan (R-37) *Matthew McQueen (D-50) * (R-1) *Andy Nunez (R-36) a Paul A. Pacheco (R-23) e Jane E. Powdrell-Culbert(R-44) e William "Bill" R. Rehm(R-31) Dennis J. Roch (R-67) Debbie A. Rodella (D-41) *G. Andres Romero (D-10) P. Roybal Caballero(D-13) * (D-12) Nick L. Salazar (D-40) e e e e a Tomás E. Salazar (D-70) *Larry R. Scott (R-62) James E. Smith (R-22) a S. Williams Stapleton(D-19) a Jeff Steinborn (D-35) James R.J. Strickler (R-2) *James G. Townsend(R-54) Don L. Tripp (R-49) (D-46) (D-25) Jim R. Trujillo (D-45) Luciano "Lucky" Varela(D-48) e e e e e e (R-66) a *John L. Zimmerman(R-39)

The Voice of New Mexico Business Vol. XXV Page 5 FOCUS Report 2015

FOCUS on Committees As shown below, the vast majority of Affairs (5), Judiciary (3), and Conser- brought up for discussion or a vote in what happens to a bill happens in com- vation (2). the committee. Because neither of mittee. ACI works extensively in the The House, too, had its share of stalled these are recorded (unlike a motion to committee process, both to block job- pro-business proposals, with five pass a bill) it is difficult to hold indi- killing legislation, and to make sure FOCUS priorities dying in House vidual legislators accountable for bills pro-business bills move forward. Of committees. that fail in a particular committee. the 24 bills supported by ACI as FO- Still, it is important to recognize which CUS priorities, ten were killed by one Bills can die either by a vote to table, committees as a whole are friendly to of three Senate Committees: Public or simply because they are never and opposed to business. Bill Progress in Committees

Bill Progressed Bill Died Bill Referred, Never Heard Cmte Cmte Floor Cmte Cmte Floor Gov Bills Supported by ACI as FOCUS Priorities: HB 55/80: Public Works Project Wages HBEC HTPWC House SJC SFC HB75: Right to Work HBEC HJC House SPAC SJC HB 130: Procurement Review HGEIC HBEC House SCORC Senate† HB 238: Workers’ Comp/Intoxication HJC HBEC House SCORC SJC not heard HB 250: Workers’ Comp/Return to Work HBEC HJC House SCORC SJC HB 261: Angel Investment Min. & Sunset HWMC* HAFC HB 286: Single Sales Factor/HQ HBEC* HWMC *HB 286 and SB 413/HB 261 were rolled into the tax package that was never brought HB 312: LEDA Implementation HBEC** HAFC for a vote in the Senate. HB 395: Venue Shopping HSCAC HJC HB 498: Preemption/Wage & Leave HRPAC HBEC SB 103: Right to Work SPAC SJC **HB 312 and SB 164 were included in the budget that was passed by both chambers SB 164: Job Training SCORC** SFC and signed into law by the Governor. SB 183: Right to Work SPAC SJC SB 184: No STB in Certain Counties SCONC SFC SB 194: Proposing & Changing Rules SRC SJC Senate HJC SB 233: Temporary Disability Benefit SCORC SJC Senate HJC House signed SB 356: Independent Hearing Office SPAC SJC Senate HWMC House signed SB 374: Uniform Enviro Covenants SCONC SJC SB 413: Angel Investment Min. & Sunset SCORC* SFC SB 421: Local Govt Zoning & Commissions SCONC SJC SB 537: Sunshine Portal State Contract Info SPAC SJC Senate HGEIC HJC House signed SB 553: Workers Comp./Intoxication SCORC SJC not heard SB 664: Right to Work SPAC SJC † Bills Opposed by ACI as FOCUS Priorities: HB 130 passed the House and Senate, but was rejected in conference committee. HB 21: Supplemental Income Tax HRPAC HWMC See the story on page 8. SB 56: Unitary combined Tax Reporting SCORC SFC SB 57: Unitary Restaurant Tax Reporting SCORC SFC ‡ The Senate Public Affairs Committee ‡ SB 152: Health Security Act SPAC SJC passed SB 152 without recommendation.

The Voice of New Mexico Business Page 6 Vol. XXV FOCUS Report 2015

Key Committee Votes Senate Corporations and Transportation Committee Senate Judiciary Committee SB 56: Unitary Combined Tax Reporting HB 250: Workers’ Compensation/ ACI Position: Supported Motion to Table Return to Work ACI Position: Supported Do Pass Motion Voted to Table (pro-business position) Voted For Do Pass Motion Sen. Phil Griego (Chair) (pro-business position) Sen. Clemente Sanchez (Vice Chair) Sen. William H. Payne (Ranking Member) Sen. William E. Sharer (Ranking Member) Sen. Ron Griggs Sen. Lee S. Cotter Sen. John C. Ryan Sen. Mark Moores Sen. Mary Kay Papen Voted Against Do Pass Motion Sen. Sander Rue (anti-business position) Sen. Richard C. Martinez (Chair) Voted Against Motion to Table Sen. Joseph Cervantes (Vice Chair) (anti-business position) Sen. Linda M. Lopez Sen. Michael Padilla Sen. Cisco McSorley Sen. Mimi Stewart Sen. Michael A. Sanchez Sen. Lisa A. Torraco Sen. Peter Wirth Senate Conservation Committee SB 184: No STB in Certain Counties ACI Position: Opposed Motion to Table Senate Public Affairs Committee HB 75: Right to Work Voted to Table ACI Position: Opposed Motion to Table (anti-business position) Sen. Peter Wirth (Chair) Voted to Table Sen. Benny Shendo, Jr. (Vice Chair) (anti-business position) Sen. Joseph Cervantes Sen. Gerald Ortiz y Pino (Chair) Sen. Phil Griego Sen. Jacob Candelaria Sen. William P. Soules Sen. Daniel Ivey-Soto Sen. Bill O’Neill Voted Against Motion to Table Sen. Mimi Stewart (pro-business position) Sen. John C. Ryan (Ranking Member) Voted Against Motion to Table Sen. William H. Payne (pro-business position) Sen. Pat Woods Sen. Craig Brandt (Ranking Member) Sen. Ron Griggs Sen. William E. Sharer (bill sponsor) Sen. Gay Kernan (did not vote)

Speaker Tripp and House Committee Leadership deserve kudos from the New Mexico business community this year for making the committee process more accessi- ble to New Mexicans. The status quo had been long delays and frequent schedule changes that made it difficult or impossible for New Mexicans to participate. House committees this year were reliable and punctual. As a result, New Mexicans taking the time to testify on a bill or sit in on a committee meeting were able to do so with much greater access and convenience.

The Voice of New Mexico Business Vol. XXV Page 7 FOCUS Report 2015

FOCUS on the Issues

Mexico or out-of-state companies, ACI’s other priority legislation was Procurement Reform copies of the contracts. SB 537 was HB 130, a bill to strengthen the pro- Procurement Reform was a key priori- sponsored by Sen. Sander Rue (R-23), curement process in New Mexico and ty for ACI during the 2015 legislative who also modernize the session, and a key legislative victory. introduced state’s defini- In 2014, ACI member businesses ex- the original ACI’s procurement reform bills tion of small pressed concerns that New Mexico Sunshine addressed transparency and the need to business. The companies were not being given a fair Portal legis- reinvest taxpayer dollars in New Mexico. bill improved chance to compete for state contracts. lation, along upon the state Through a series of public inquiries, with Rep. Stephanie Garcia Richard procurement process by allowing the ACI discovered that it is extremely (D-43). After passing both houses state standards and specifications com- difficult or impossible to access infor- with broad bipartisan support, the bill mittee to conduct monthly reviews of mation on factors used in awarding was signed into law. This will mean RFPs coming from the state and make state contracts, or even the percentage more accountability in the way state recommendations to state agencies. of state dollars spent with New Mexico tax dollars are spent, and better invest- Further, the bill updates the state defi- businesses versus out-of-state compa- ment for New Mexico. nition of small business, which cur- nies. Research has shown substantial rently excludes any business with over economic benefits to in-state procure- $1.5 million in annual revenues, a ment, as up to 60% of money spent in- threshold set in the 1980s. The pro- state is reinvested in the local econo- posed legislation would amend the my, benefiting other local businesses definition to include businesses with and spurring local job creation. fewer than 150 employees. ACI helped to author and introduce HB 130 passed both chambers with two key procurement bills to improve overwhelming bipartisan support. transparency and accountability with However, the Administration was un- regard to how New Mexico tax dollars supportive of the proposal throughout are spent: SB 537, and HB 130. Sen. Sander Rep. Stephanie the process, and as a result, concur- SB 537 is a bipartisan bill to enhance Rue Sponsored Garcia Richard rence on amendments was not reached the Sunshine Portal by publishing in- SB 537 sponsored SB in conference committee and the bill formation on state contracts, including 537 and HB 130 died. ACI will continue to support this whether state contracts went to New proposal as a top priority.

nue Department (TRD) uses an internal Independent Hearing hearing officer system for handling Office administrative protests, raising con- One of ACI’s key victories this session cerns about accountability and trans- was Senate Bill 356, a bill to introduce parency. SB 356 creates an Adminis- an independent hearing office separate trative Hearings Office administratively from the Taxation and Revenue Depart- attached to the Department of Finance ment. The bill was sponsored by Sena- and Administration and separate from tor Jacob Candelaria (D-26) and Rep. TRD. The bill also creates procedures for tax protests, motor vehicle adminis- Jason Harper (R-57). Sen. Jacob Candelaria and Rep. Making sure that tax issues are handled trative hearings, and amends several definitions. This legislation will create Jason Harper sponsored ACI’s with accountability and fairness is a top SB 356 concern of New Mexico businesses, a more fair appeal process for taxpay- and a top priority for ACI. Independ- ers in New Mexico. Candelaria, whose district includes solve their tax disputes. This bill re- ent hearing officers ensure that taxpay- moves even the appearance of a con- ers, whether individuals or businesses, parts of Albuquerque’s west side, said that the bill is about protecting New flict of interest, so that New Mexicans receive a fair hearing in front of a neu- can have every confidence in the hear- tral, independent decision maker. This Mexicans. “This is a bipartisan pro- posal,” Candelaria said. “We can all ing process, and so that disputes are is good for business, good for individu- resolved fairly and openly.” als, and good for our state. agree that New Mexicans deserve a fair, transparent hearing process to re- SB 356 was signed into law after re- Currently, the State Taxation and Reve- ceiving broad bipartisan support.

The Voice of New Mexico Business Page 8 Vol. XXV FOCUS Report 2015 The 2015 By the Numbers

16 ACI-supported bills 87 0 became law Anti-business bills Became Law opposed by ACI

Bills tracked of by ACI 10 24 Based on Pro-business FOCUS priority bills Member Input blocked by the 423 Senate Public Affairs, Conservation, and Judiciary Committees ACI blocked 12 major tax increase bills, saving NM businesses FY 2015 Budget $152,115,000 $37.5 million In FY 2016 alone Funding for LEDA (“Closing Fund”) $7.5 million 18 94 Funding for JTIP Freshmen Legislators Returning Legislators $2.5 million Recurring JTIP funding $1.18 million Funding for the New Mexico Part- nership, the marketing arm of New $50,000 Mexico’s economic development ef- Taxpayer cost per day for a special legislative session forts. $1.25 million The last time the New Mexico State Legislature passed fewer Increase for tourism marketing 1949 funding bills than it did in 2015

The Voice of New Mexico Business Vol. XXV Page 9 FOCUS Report 2015

versified approach to economic devel- ing. Recurring funding for JTIP is The Budget opment. New Mexico must attract new itself a major accomplishment, as it One of the greatest victories for busi- business and jobs, but in doing so we means a strong future for this im- ness in 2015 was the passage of con- must not forget about the companies portant program. siderable new funding for key recom- already investing here. It is vital that According to the New Mexico Eco- mendations of the Legislative Jobs any economic development policy nomic Development Department, JTIP Council. ACI’s Dr. Beverlee McClure helps New Mexico businesses grow, “funds classroom and on-the-job train- is a member of the Jobs Council, and and gives them every reason to keep ing for newly-created jobs in expand- ACI has advocated for the Jobs Coun- their jobs and investment in New Mex- ing or relocating businesses for up to 6 cil’s recommendations of reinvesting ico. months,” helping to offset the cost of state funds in economic development creating new jobs and helping employ- efforts. This year, those efforts paid ers invest in New Mexicans. Since its off: Major funding increases for creation, JTIP has supported the crea- JTIP, LEDA, and marketing tion of 43,000 jobs in nearly 1,300 LEDA efforts send a clear message: businesses statewide. The budget passed with bipartisan sup- port and signed by the Governor in- New Mexico is committed to Marketing cluded $37.5 million in funding for investing in businesses that The budget also included $1.18 million LEDA, the Local Economic Develop- for the New Mexico Partnership, the ment Act, commonly referred to as the invest in New Mexico. marketing arm of New Mexico’s eco- “closing fund.” The Jobs Council has nomic development efforts, and a recommended a total of $50 million for Last year, only $15 million was appro- $1.25 million increase for tourism mar- LEDA. With broad partisan tensions priated for LEDA. With that number keting funding. ACI supports both throughout the session and crippling more than double for the coming year, investment in local businesses, and loss of expected funds with the sudden New Mexico has not only expanded recruitment to bring outside business drop in oil prices just before the ses- opportunities to invest in job-creators here. This year’s budget includes a sion opened, the $37.5 million allocat- here, but also sends a clear message strong mix of funding for both goals. ed in the budget represents a major that we are open for business and com- victory for job growth in New Mexico. Note: Part of the budget deal between mitted to investing in businesses that This funding goes towards attracting the House and the Senate was the tax invest in New Mexico. new business and jobs from out of package, SB 386, that was never state, and to helping local businesses passed. SB 386 included a number of grow—for example, Santa Fe Brewing JTIP The budget also included $7.5 million key ACI initiatives. See p. 13 for more Co. was able to access LEDA funding in funding for JTIP, the Jobs Training information on this important bill and to help it expand and add jobs. ACI Incentive Program, $2.5 million of why it still needs to be passed. has been a constant advocate of a di- which is designated as recurring fund-

ed over 5700 individual projects with an especially severe impact on Capital Outlay throughout the state. While some capi- local businesses who rely on in-state In the final hours of the 2015 session, tal projects are funded in the budget projects. Some have estimated that the legislature failed to pass a $264 that was passed by both chambers and this year’s capital outlay bill equates to million capital outlay bill, and the fu- signed into law by the governor, the jobs for 6500 New Mexicans. ture of that spending remains uncer- lack of a capital outlay bill this session A special session costs taxpayers ap- tain. still leaves an immense funding short- proximately $50,000 per day. With age at a vital time for New Mexico’s Capital outlay is a package of funding thousands of jobs and hundreds of mil- economy. In addition to the local lions of dollars in reinvestment in New for a broad array of projects, such as needs left unfunded without the pas- improvements and new construction of Mexico on the line, ACI has advocated sage of this bill, New Mexico contrac- for a special session, but holds that an senior centers, schools, libraries, and tors, builders, and related industries other community buildings; waste agreement must be reached ahead of will be hit hard by the unexpected loss time to curb costs to taxpayers and management projects; community un- of a quarter-billion dollars in projects. dertakings, infrastructure projects, and avoid a fruitless partisan battle. With- other initiatives. The list of requested The uncertainty and loss of funding out a special session, new funding will capital outlay projects for 2015 includ- will cost the state thousands of jobs, not be available until July of 2016.

The Voice of New Mexico Business Page 10 Vol. XXV Join ACI! ACI Memberships can cost less than a dollar a Company: ______day, and make a true difference in our state. ACI membership gives you: Primary Contact: ______

 Influence: ACI can help guide your organiza- Email: ______

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The Voice of New Mexico Business Vol. XXV Page 11 FOCUS Report 2015

members as anti-business bills, and Anti-Business were opposed by ACI. Not a single Tax Increases one of these became law. Eighty-four Tax Increases that ACI helped Legislation of these bills died in the legislature, defeat in 2015 One of ACI’s historic strengths has most of them never passing a single included: been our ability to block bad legisla- chamber. While floor votes get most tion. That was especially true this of the publicity, a bill is assigned to a HB 16: Surtax on session, where the early days of the number of committees and must be Certain Corporations session were spent testifying against a voted out of each before making it to a (Rep. McCamley) flurry of misnamed and misguided floor vote. It is here that most bills HB 21: Phased-In proposals that would have hurt busi- live or die, and it is here that ACI is Supplemental Income Tax ness. This year, not a single ACI- most effective. Using data, member (Rep. Roybal Caballero) opposed bill became law. testimony, and the direct engagement HB 110: New Tax Bracket & of our member businesses, ACI is able Income Tax rates to educate legislators in committee (Rep. McCamley) Every anti-business bill hearings on the negative impacts of HB 137: Reduce Income Tax & opposed by ACI this year was misguided legislation. Create New Brackets prevented from becoming law. (Rep. Miguel Garcia) Only two bills opposed by ACI made HB 495: Corporate Tax it to the Governor’s desk: SB 105, for PreSchool Programs County Gross Receipts for School (Rep. Roybal Caballero) The Process Improvements, and SB 114, Local HB 239: Repeal Capital As bills are introduced throughout the Government Special Fuels Taxes. Gains Deduction session, ACI’s FOCUS Committee Both were vetoed. Both of these bills (Rep. Christine Trujillo) (made up of ACI members) meets would have meant higher taxes for weekly to review every new bill intro- businesses in New Mexico, killing duced and compare these against the jobs and impeding growth. Other Bills ACI Opposed priorities outlined by ACI’s policy None of the following made it out of the legislature: committees in the prior months. It is Minimum Wage Increases either determined that ACI will watch, ACI helped defeat a number of support, or oppose these bills, or re- HB 111 / SB 697: Shared minimum wage increases in 2015, main neutral (if a bill has no impact Renewable Energy including: on business or on ACI’s member pri- Facility Operations (Rep. Gonzales / Sen. Wirth) orities). HB 20: Raise Minimum Wage HB 180 – Minimum Wage Act (Rep. Varela) Many anti-business proposals had HB 138: Increase Minimum “Employee” Definitions positive-sounding titles and stated Wage (Rep. Maez) goals that make it difficult for legisla- (Rep. Garcia) HB 331 / SB 609 – ABQ- tors and the public to understand the HB 360: Increase Minimum Bernalillo Water Authority bill’s real consequences. Because of Wage & Annual Increase Board Election ACI’s constant, direct engagement (Rep. Roybal Caballero) (Rep. Romero / Sen. Ortiz y Pino) with members during the legislative SB 10: Raise Minimum Wage SB 145 – Use of Credit Info for session, we are able to quickly identi- (Sen. C. Sanchez) Employee Recruitment fy potential problems with such bills, SB 350: Increase Minimum (Senator O’Neill) disseminate information, and voice Wage & Index to Inflation SB 152 – Health Security Act (Senator Morales) employers’ concerns before these bills (Sen. Campos) SB 351 – Dairy Workers in become law. SB 432: Increase Minimum Wage & Annual Increases Minimum Wage Act Results (Sen. Soules) (Sen. Stewart) Of the 423 pieces of legislation ACI SJR 9: Increase & Index SB 583 – Criminal Offender Employment Eligibility tracked during the 2015 legislative Minimum Wage (Sen. O’Neill, Rep. Baldonado) session, 86 were identified by ACI (Sen. Soules)

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Right to Work and Indiana , the most recent states to proposals this year. become right-to-work, have both add- It was especially concerning that Right to Work has long been a priori- ed over 140,000 jobs each in less than many opponents of right-to-work— ty for ACI, and this year the issue two years. Job growth is consistently legislators and activists alike— took center stage. ACI was actively faster in right-to-work states, and site acknowledged the difficulty of finding working for right-to-work long before selectors continue to point to New good jobs in New Mexico, but still the session began, helping to elect Mexico’s non-right-to-work status as argued for the status quo. The cogni- many of the pro-business representa- a key factor keeping us off many lists tive dissonance is saddening and dis- tives whose votes shifted the discus- for new jobs. sion, and organizing business leaders plays much of the After passing the statewide to unite on key priorities. reason New Mex- House with bi- Many opponents of right-to-work ico continues to What was striking about the debate on partisan support, rank at the bottom acknowledged the difficulty of right-to-work was the overwhelming the measure was of the nation. We emotion that surrounded the issue. assigned to three finding good jobs in New Mexico, recognize our ACI listened to hours of testimony committees in the but still argued for the status quo. weaknesses, but from the opposition, and the union Senate—usually insist on doing members who showed up by the hun- anything more everything the dreds to oppose the bill genuinely than two is a death sentence for a same way. ACI, by contrast, is com- believe (wrongly) that right-to-work bill—and tabled without delay in the mitted to fighting this stagnancy will mean lost benefits, an end to their Senate Public Affairs Committee. As through education, engagement, and union memberships, and lost opportu- you will notice in the Legislative advocacy, which we did this session nities. Scorecard, Senate Public Affairs was at every turn and will always continue The reality is the opposite: Michigan a graveyard for many pro-business to do.

“The Tax Package” ter opportunities for New Mexicans. panding the Angel Investment Tax One piece addresses the way New Credit creates more incentive for in- In the final moments of the legislative Mexico taxes headquarters. You might vestors to keep their money here, in- session, New Mexicans lost out as nu- have noticed there aren’t many region- stead of investing in companies outside merous important bills were aban- al or national companies headquartered the state. That means more jobs get doned. The most publicized was the here. That’s because New Mexico created here, more jobs stay here, and capital outlay bill, and ACI has active- uses an outdated tax structure that pe- New Mexicans have more opportuni- ly called for a special session to get it nalizes headquarters who expand here ties to succeed. passed. But New Mexico shouldn’t by increasing their tax burden as addi- The package also includes a deduction forget about another bill that also tional New Mexicans are hired. In for energy companies, whom New needs to be on any special session other words, we actually encourage Mexico currently places at a seven agenda: Senate Bill 386, a bipartisan these businesses not to invest in New percent disadvantage compared to oth- package of tax code improvements. Mexico. The proposed change would er states. As a result of this disad- Some have said we should ignore all keep jobs here, instead of rewarding vantage, energy companies can save other legislation to focus only on capi- employers for moving jobs out of money by moving away, despite our tal outlay. But this kind of thinking state. Headquarter operations bring ideal location as a center of energy holds our state back. The tax package jobs, opportunities, and expanded reve- innovation. New Mexico has lost was created as part of a bipartisan deal nue for local small businesses—which thousands of jobs and hundreds of mil- already agreed upon by the House and means even more jobs and more op- lions of dollars to other states because Senate. New Mexico’s tax system portunities for New Mexico. of this issue alone. Until a fix is enact- needs to be improved, and this session Another proposal included in the pack- ed, our state will continue to bleed jobs Democrats and Republicans worked age improves the Angel Investment and money that be staying here. together to identify improvements and Tax Credit. One of the most significant A special session is needed, but let’s assemble a strong proposal that will problems faced by small businesses make sure we make the most of benefit our state. There is no reason and entrepreneurs here is lack of ac- it. New Mexicans shouldn’t have to not to finish the job and pass the bill. cess to capital. Companies needing a wait another year for fixes to some of The package contained a number of little extra money to start a new busi- the simplest problems holding our state key proposals that ACI championed ness, hire another employee, or buy back—especially when we already this year for one simple reason: they new equipment just can’t get the funds have those solutions ready to go. will help our economy and create bet- they need to reinvest in the state. Ex-

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which have previously been extended bills proposed to limit worker’s com- Workers’ Comp and without limit at a major potential cost pensation for employees who are un- to employers. Without limitation, in- der the influence of alcohol or drugs Workplace Issues surance premiums for employers are when injured. Three key workplace issues proposals difficult to set, especially for New were backed by ACI this session, and House Bill 250 would have required Mexico’s self-insured employers. The employees on worker’s compensation one of the three ultimately became passage of this bill is an important law. to return to work if their employer achievement for New Mexico’s job- offers them a job with equal or higher Senate Bill 233 provides clear defini- creators. pay which they are medically capable tions for temporary disability pay- House Bill 238 and its companion of doing. ments, and was signed into law after bill Senate Bill 553 both passed the ACI will continue to advocate for being passed by both houses. The bill House and the Senate Corporations provides a maximum lifetime period these proposals in future legislative and Judiciary Committees, but were sessions. for temporary disability payments, never heard on the Senate Floor. The

take questions from ACI members FOCUS on the statewide. ACI has taken the lead on this issue, and will continue to work Governor closely with Secretary Bussey on a As shown in the scorecard below, ACI proposal to address high unemploy- tracked 20 bills that made it to the gov- ment insurance rates faced by New ernor’s desk: 18 pro-business bills ACI Mexico businesses. supported, and 2 anti-business bills ACI opposed. Of the 18 pro-business Secretary Tom Clifford of the Depart- bills, 16 became law, one was pocket- ment of Finance and Administration, vetoed, and one was vetoed. Of the and Secretary Demesia Padilla of the two bills opposed by ACI, both were Taxation and Revenue Department vetoed. were also helpful and lent their support to ACI’s efforts, particularly on ACI’s Committee & Reviews. ACI believes ACI worked effectively with various headquarter incentive bill (HB 286) administration officials during the ses- that this bill—which would have up- and independent hearing office bill dated the definition of small business sion. For example, Cabinet Secretary (SB 356). Celina Bussey of the New Mexico and added accountability measures for Department of Workforce Solutions Unfortunately, the Administration was state contracting—is important. ACI was helpful in discussions about un- not supportive of ACI’s robust over- will continue working on this im- employment insurance rates. The Sec- sight and transparency measures intro- portant issue. retary even agreed to join a call and duced in HB 130, State Procurement Governor’s Scorecard 2015 Actions taken on ACI-tracked bills that made it to the Governor’s desk: A “thumbs up” reflects an action by the Governor (signature or veto) supported by ACI, while a “thumbs down” reflects an action opposed by ACI. Bills in red were opposed by ACI as anti-business; bills in black were supported by ACI as pro-business.

HB 38: Forest & Watershed Restoration Act SB 302: Admin & Accounting Svc. Gross Receipts HB 121: Use of Nurse Educators Fund SB 319: County IRB Projects & Complaint Process HB 383: Fin. Assurance for Abandoned Oil Wells SB 352: Utility Economic Development Rates SB 52: Extend Port of Entry Overweight Zones SB 356: Tax Administrative Hearings Office Act SB 153: Streamline Teacher Admin. Licensure SB 379: Child Care Assistance Accountability Act SB 226: Public Water Use & Landowner Protection SB 480: State Purchasing Expenditure Codes SB 233: Temporary Disability Benefit Changes SB 537: Sunshine Portal State Contract Info SB 241: Certain Liquor License Transfer Limits SB 552: Drinking Water System Financing SB 276: State Engineer Hearing Locations SB 105: Gross Receipts. for School Improvements SB 291: Capital Outlay Reauthorizations SB 114: Local Government Special Fuels Taxes

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The Legislative Process In New Mexico

BILL DRAFTED

All bills follow the same path through the legislature. Any bill can be introduced in the house or the senate. The bill is assigned a number, read twice, printed and referred to the proper committee.

BILL REVIEWED

Each bill is reviewed by one or more committees in each house. The committees can approve the bill, amend it, forward it to the next committee with no recommendation, or kill the bill by tabling it.

BILL INTRODUCED

If a bill passes its committee hearings, it will be considered by the full house where it was introduced. The bill is placed on that house’s calendar, which means it is formally scheduled for its third reading and a final vote. BILL INTRODUCED TO 2ND HOUSE

If it passes, the bill moves to the other house and repeats the entire process. If approved in the same form, it goes to the Governor to be signed or vetoed. If each house passes a different bill, they form a conference committee to work on a compromise. If the committee agrees ona compromise, the bill goes back to the house and senate for a final vote.

GOVERNOR’S DESK

Bills that pass both houses go to the Governor to be signed or vetoed. The governor can sign the bill, making it law, veto it or veto portions of it, if it contains an appropriation. NOT SIGNED BILL SIGNED

If the governor doesn’t sign or veto a bill within Signed bills typically become law 90 days after three days—and if the legislature is still in the legislature adjourns. However, the session—it becomes law. Once the legislature legislature can specify an emergency, which has adjourned, the Governor has 20 days to makes the bill effective when the Governor sign bills. Unsigned bills are pocket-vetoed. The signs it, or a later date for the law to go into legislature can pass a bill over the Governor’s effect. veto with a two-thirds vote in each house.

50th Legislature, First Session, 2011 Legislative Almanac

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Bill Catalog: Key Bills ACI Tracked and Where They Ended Up *Indicates a bill supported or opposed by ACI as a FOCUS Priority help with economic development and tourism. for hearings relating to regulations or water quality standards. Current- Passed both the House and the Senate and was signed into law by the ly, the Commission meets in Santa Fe and it is difficult for business Bills Supported by ACI: Governor. people to have input into the process. This moves the meetings to the HB261: Angel Investment Credit Minimum Investments (J. Powdrell- area impacted by the rule being promulgated by the Commission. Economic Development Culbert): This bill, a companion bill to SB 413, increased the annual Passed the House on a unanimous vote and was given a do pass by the SB52: Extend Port of Entry Overweight Zones (M.K. Papen): This bill amount of Angel Investment Credits that can be issued to an aggregate Senate Corporations Committee, but was blocked by the Senate extended the overweight zone from border crossings to 12 miles with $2M and eliminates some restrictions on the type and number of Judiciary Committee. approval of the Department of Safety (and with the exception of investments that can be made and still be eligible for the Angel Invest- *SB194: Requirements for Proposing & Changing Rules (D. Ivey-Soto): manufactured homes) in the case of emergencies. The department will ment credits. The credit percentage remains at 25%, but the amount of This bill revised the State Rules Act regarding the requirements for guide the transportation with respect to a route appropriate for size and a qualified investment increases to $250K from $100K.The bill also proposing, adopting, amending or repealing rules. The bill requires weight. Permits will be valid for no more than one year and with a fee extended the December 31, 2016 sunset date on the credit to Decem- agencies to follow the Administrative Procedures Act (APA) when of no more than $250.This extension is necessary to encourage and ber 31, 2012. The credit remains non-refundable, but the carry-forward promulgating rules. Implementing the APA has been a long-time priority increase our border enterprise. period is extended to 5 years from the current 3 years. The bill also for ACI. We believe this will standardize the process and make it easier Passed both the House and the Senate; signed into law by the Gover- contained several other provisions. for businesses and individuals to have a voice in the regulatory process. nor. Rolled into SB 386 by the House Ways and Means Committee as part Passed the Senate but was blocked by the House Judiciary Committee. SB69: Resident Business Set-Aside Act (M. Padilla): This bill modeled of the tax package that ran out of time in the final hour of the legisla- *SB356: Tax Administrative Hearings Office Act (J. Candelaria, J. the federal procurement process in that it required the state to award tive session (see p. 13 for details). Harper): This bill creates the Administrative Hearings Office administra- 33% of certain contracts to resident businesses. The bill had stringent *HB286: Single Sales Factor for Corporate Income (C. James): The bill tively attached to the Department of Finance and Administration (DFA), guidelines to qualifications for a resident business, as well as penalties provided a tax incentive for businesses that are headquartered in New and separate from the Taxation and Revenue Department (TRD). This for falsely filing as a resident business. In addition, the bill called for Mexico, encouraging retention and expansion of current headquarters legislation moves the hearing bureau of the TRD to DFA and establishes agencies to annually report the number of contracts that the dollar operations, as well as the addition of new jobs. The bill defines the position of a chief hearing officer. The bill also creates procedures amount to resident versus out-of-state businesses. “headquarters operation” by function, not size: the center of operations for tax protests, motor vehicle administrative hearings, and amends Passed the Senate on a 21-18 vote but was not brought up for consid- of a business. several definitions. This legislation will create a more fair appeal process eration in the House. HB 286 was rolled into SB 386 by the House Ways and Means Com- for taxpayers in New Mexico. Special thanks to Anthony Trujillo, owner & CEO of Holman’s USA and mittee as part of the tax package that ran out of time in the final hour Passed both the Senate and the House with overwhelming bipartisan ACI Executive Committee member for serving as the expert witness, and of the legislative session (see p. 13 for details). support, and was signed into law by the Governor. for his constant assistance on this bill. HB299: Public Private Partnership Act (L. Larranaga): This bill enacted HB366: Oil & Gas Preemption (N. Gentry): This bill delineated the *HB75: Employee Preference Act (D. Roch): This bill was a comprehen- the Public-Private Partnership Act (PPPA) to allow state and local powers and duties of the Oil Conservation Commission and EMNRD’s Oil sive Right to Work bill impacting the private and the public sector. A governments to enter into long-term agreements with private sector Conservation Division, to expressly declare the state’s exclusive jurisdic- committee substitute for the bill was introduced by Rep. Nate Gentry partners to facilitate public projects such as schools, hospitals, recrea- tion and authority over all matters relating to oil and gas operations. and approved by the committee. The substitute bill increased the tional facilities, parking lots, roads, habitat restoration, dams, water This bill prevented future reductions in revenue that could be caused by minimum wage to $8 with a 6 month training wage of $7.50. treatment facilities, pipelines, transmission lines, recycling facilities, etc. county or municipal regulations restricting oil and gas operations. Tabled by the Senate Public Affairs Committee on a party-line vote. Passed the House and was blocked by the Senate Judiciary Committee. Passed the House but was blocked by the Senate Conservation Com- *HB130: State Procurement Committee & Reviews (S. Garcia Richard): *HB 312: Local Economic Development Act Implementation (W.K. mittee. This bill proposed to expand the state procurement standards and Martinez, M.K. Papen): This bill appropriates $50 million from the specification committee from 11 to 13 members, adding two more general fund to the Economic Development Department (EDD) for the Workplace Issues private sector representatives, and requires the committee to meet purpose of funding projects pursuant to the Local Economic Develop- *SB233: Temporary Disability Benefit Changes (P. Woods/C. Trujillo): monthly and review requests for proposals and notify the relevant ment Act (LEDA). LEDA is a key Jobs Council priority and a top priority This bill amended the workers’ compensation act and the New Mexico agency of its concerns and recommendations on how to remedy those for ACI. occupational disease disablement law to change temporary disability concerns. $37.5 million was ultimately appropriated for LEDA in the budget sent benefits, providing for lifetime maximum period. 700 weeks (13.5 years) Passed both the House and the Senate, but ran out of time in confer- to the Governor’s desk. has been considered “temporary disability.” Recent court cases have ence committee. SB413: Angel Investment & Minimum & Sunset (C. Sanchez): This bill, a extended this definition to an unlimited amount of time. Without SB160: Implement Local Economic Development Act (M.K. Papen): companion bill to HB 261, amended provisions of the Angel Investment limitation, insurance premiums for employers may increase and re- This bill appropriated $50 million from the general fund to the Economic Credit by clarifying the number of investments that would qualify for serves may be difficult to set, especially for New Mexico’s self-insured Development Department (EDD) for the purpose of funding projects the credit, extending the sunset date, increasing the total amount of employers. pursuant to the Local Economic Development Act (LEDA). In addition to annual credits that may be issued to two million dollars ($2,000,000) Passed both the Senate and the House, and was signed into law by the being an ACI priority, this funding is also a Jobs Council Priority. and increasing the carry forward to five years. This provided a mecha- Governor. Given a do pass by the Senate Corporations Committee, blocked by the nism for greater private investment into companies in our state to *HB238: Worker’s Comp Benefits & Intoxication (D. Roch, J. Cervan- Senate Finance Committee. enhance job growth and retention. This helped address the lack of tes): This bill amended the Workers' Compensation Act to provide that *SB164: Job Training (Rep. K. Martinez, Sen. M.K. Papen): This bill capital available in New Mexico, which is the number one concern of compensation benefits under the Workers' Compensation Act are to be proposes a $12 million appropriation from the general fund to the entrepreneurs that ACI has met with across the state. reduced by the degree to which an employee was intoxicated or under development training fund for expenditure in fiscal year 2016 and Rolled into SB 386 by the House Ways and Means Committee as part the influence of alcohol and/or a drug. The companion bill in the Senate subsequent fiscal years for the Job Training Incentive Program (JTIP), of the tax package that ran out of time in the final hour of the legisla- was SB 553: Workers’ Comp Benefits & Intoxication (J. Cervantes). administered by the Economic Development Department. Note: HB2 tive session (see p. 13 for details). Passed the House, the Senate Judiciary Committee, and the Senate contains a $7.5M appropriation for JTIP. *SB537: Sunshine Portal State Contract Info (S. Rue, S. Garcia Richard): Corporations Committee, but was not brought for a vote on the Senate $7.5 million was ultimately appropriated for JTIP in the budget sent to This bill requires the following information to be placed on the Sunshine floor. the Governor’s desk. Portal Act regarding state contracts: the name of the recipient of the *HB250: Worker’s Comp Return to Work & Benefits (R. Crowder): This SB193: PRC Jurisdiction Over Local Phone Carriers (M. Padilla): The contract; the purpose of the contract; the amounts expended on the bill clarified language to address recent court rulings which the Workers’ companion bill to HB 626, this bill amended the New Mexico Telecom- contract; a copy of or an internet web site link to a copy of the contract Compensation Administration (WCA) believes adversely impacts the munications Act to substantially reduce Public Regulation Commission document, including amendments; and a copy of or an internet web site return to work provisions and formulaic design of the Workers’ Com- (PRC) authority over “incumbent local exchange carriers” serving more link to a copy of a resident business, resident veteran business, resident pensation Act. The bill attempted to restore balance to the workers’ than 50 thousand access lines (telephone lines) within the state (and contractor and resident veteran contractor certification used in the compensation system and clarify a worker’s entitlement to disability thereby releasing certain incumbent carriers from the higher level of award of a contract. This bill will create better transparency with the benefits when an injured worker (1) returns to work earning the at regulation adopted in 1985 prior to the large-scale introduction of procurement process and help insure more in-state companies are injury wage, (2) refuses to accept a return to work offer from an em- wireless communications and the elevated need for broadband internet given a fair chance to compete. ployer, or (3) engages in misconduct or is terminated for cause unrelat- access). The bill made extensive changes to the definitions section of Passed the House and the Senate with overwhelming bipartisan ed to the work injury after returning to work following an injury. The bill the act and redefines its purpose by extending to all consumers and support; was signed into law by the Governor. also provided for bad faith penalties against an employer who termi- carriers in the state “the benefits of the regulatory flexibility previously HB 626: PRC Telecom Jurisdiction (J.E. Smith) The companion bill to SB nates a worker for pre-textual reasons to avoid payment of benefits. provided only to incumbent rural telecommunications carriers” and by 193, this bill also amends the New Mexico Telecommunications Act to Passed the House on a unanimous vote, and passed the Senate adding greater investment in broadband infrastructure in the explana- substantially reduce Public Regulation Commission (PRC) authority over Corporations Committee, but was blocked by the Senate Judiciary tion of legislative intent. “incumbent local exchange carriers” serving more than 50 thousand Committee. Given a do pass by the Senate Corporations Committee but blocked by access HB 482: Reduce Some Unemployment Benefits (L. Larranaga): This bill the Senate Judiciary Committee. lines (telephone lines) within the state (and thereby releasing certain proposed changes that would reduce an individual's weekly benefit *SB183: Employee Preference Act (W. Sharer): This bill is a comprehen- incumbent carriers from the higher level of regulation adopted in 1985 amount from fifty-three and one half percent (53½%) to forth-five sive right-to-work bill that impacts the private and the public sector. prior to the large-scale introduction of wireless communications and the percent (45%) for insured work paid to the individual in that quarter; Right to Work will be beneficial to the New Mexico workforce. Statistics elevated need for broadband internet access). The bill makes extensive and amends (B)(1) by adding that no benefit computed may be less than over the last 20 years have shown a greater increase in jobs in those changes to the definitions section of the act and redefines its purpose ten percent or more than forty-five percent of the state's average states are Right to Work vs. New Mexico and others states that are not. by extending to all consumers and carriers in the state “the benefits of weekly wage for all insured work. Right to Work status is also documented as a determining factor for the regulatory flexibility previously provided only to incumbent rural Failed on the House Floor in a 25-39 vote. ACI has already taken the companies expanding operations for economic based jobs to new telecommunications carriers” and by adding greater investment in lead on continuing the conversation in the interim to identify potential states. There is consensus among economic development professionals broadband infrastructure in the explanation of legislative intent. legislative solutions. that many site selectors will never even consider non-right-to-work Passed the House but was blocked by the Senate Judiciary Committee. states. Private sector employees have the right to organize and partici- Agriculture and Food pate in unified representation in the work place; however, organized Regulatory and Government HB564: Right to Farm and Operations as Nuisance (B. Wooley): This bill labor union membership should be voluntary and no employee should HB 55/80: Public Works Project Wages Through Survey (N. Espinoza, C. revises current law regarding Agricultural Operations Deemed Not a be required to join a union as a condition of employment, which Pirtle, W. Rehm): This bill was put forth to effectively repeal SB33 that Nuisance. Agricultural operations are deemed "not a nuisance" if at the subjects them to full union dues and to union rules and fines. was passed in the 2009 legislative session. This bill proposed to deter- time the operation began, and it has been in operation for more than a Blocked by the Senate Public Affairs Committee. mine wage rate and fringe benefit rates on public works projects year, there are no nuisance issues. The change in language removes the SB241: Certain Liquor License Transfer Limits (P. Griego): This bill through a survey process conducted by the director. The bill was to one-year of operation language. This bill would ensure the availability of impacted the transferability of quota liquor licenses statewide. It delete Subsection B of the statute, in which the director must use the a safe, abundant, and cost-effective local food supply. allowed dispenser’s licenses which are currently restricted in under prevailing rates of collective bargaining agreements that exist in the Passed the House and the Senate Conservation Committee, but was quota local option districts to be able to transfer out of such districts; locality of the project. blocked by the Senate Judiciary Committee. allowing the license to be sold and moved to another location. It further Passed the House but was blocked by the Senate Judiciary Committee. allowed liquor licenses to transfer into local option districts already over HB87: Water Quality Control Commission Meetings (C. Ezzell): This bill Education quota. This bill helped transfer stranded liquor license to rural areas and required the Water Quality Control Commission to set a time and place HB41: School Grade Promotion & Retention (M. Youngblood): The bill

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was part of the administration’s educational reform package and restricts Agriculture and Food Blocked by the Senate Finance Committee. promotion of students who are not academically proficient in reading HB275: Separate Reporting of Tax Expenditures (D. Armstrong): This bill *HB110: New Tax Bracket & Income Tax Rates (B. McCamley): This before third grade. The bill also called for intensive remediation for those would require all taxpayers who reduce tax liabilities by taking advantage legislation expanded current income tax brackets and created a new students and intervention prior to the third grade. The legislation provid- of a tax expenditure to separately report that tax expenditure to the 5.9% bracket for taxable incomes in excess of $60K for single filers, $90K ed for assistance for students in fourth through eighth grade, but did not Taxation and Revenue Department. The bill was not specific about what for married filing jointly and head of households, and $45K for married require a delay in their promotion. School districts are required to create constitutes a tax expenditure. However TRD is instructed in the bill to filing single. This bill would have a negative impact on small businesses, an alternative program for students deemed in need of assistance. promulgate regulations as to which tax expenditures would be affected most of which pay PIT. Passed the House on a 38-30 vote but was blocked by the Senate Public by separate reporting. Blocked by the House Regulatory and Public Affairs Committee. Affairs Committee. This bill added greater regulation and administrative burden to business, *HB137: Reduce Income Tax & Create New Brackets (M. Garcia): This bill HB71: Streamline Teacher & Administrator Licensure (T. Lewis): This bill including small businesses. reduced rates in existing income tax brackets and creates three new was also part of the administration’s education reform package. This Blocked in the House Ways and Means Committee. brackets on higher incomes. The increased rate is as high as 7.1%. legislation changes to the three-tiered licensure system for school Blocked by the House Regulatory and Public Affairs Committee. administrator (principal and assistant principal) license. The bill de- Health Care HB158: Gross Receipts Tax & Deductions (B. McCamley): This bill amend- creased the administrator license from a nine-year license to a five-year SB12: Obesity & Weight Reduction Weight Reduction Insurance Cover- ed the Gross Receipts Tax and Compensating Act to repeal selected gross license and changes the pathway to school administration. Pursuant to age (J. Candelaria): This bill enacted a new section of the Health Care receipts tax and compensating tax exemptions and deductions. To offset the bill, administrator licenses will be granted to level two teacher Purchasing Act that requires health insurers to cover obesity prevention, the revenue gains from these expansions of the taxable gross receipts applicants who have completed or are participating in a Public Education screening and treatment for weight reduction. While we applaud what base, the bill reduced the state gross receipts tax rate by 1/10 percent, Department-approved administrator preparation program and hold a the sponsor is trying to accomplish, mandated benefits increase cost from 5.125 percent to 5.025 percent. The provisions of this bill appear current level two license. which will be passed on to the consumer. Additionally, the language is intended to be approximately revenue neutral to the general fund. That Passed the House on a 38-24 bipartisan vote and was given a do pass by extremely broad and will also increase the cost to the state to imple- is, the general fund revenue generated by the repeals is used to offset the Senate Education Committee, but was blocked by the Senate Public ment. Many of the services listed are already included in coverage if the the general fund revenue loss resulting from the GRT rate reduction. Affairs Committee employer group wants them to be. However, the expansion of the taxable gross receipts base, combined SB153: Streamline Teacher Administrative Licensure (S. Beffort): The bill We would prefer to see this kind of coverage incentivized, not mandated. with unchanged local government taxing authority, would result in decreased the administrator license from a nine-year license to a five- Blocked by the Senate Corporations and Transportation Committee. increased revenue to the state’s municipalities and counties. Additional- year license and changes the pathway to school administration. Pursuant HB81: Patient Safe Staffing Act (Christine Trujillo): This bill’s title makes it ly, ACI supports comprehensive reform. to the bill, administrator licenses will be granted to level two teacher sound like a good piece of legislation. However, passage of this bill would Blocked by the House Regulatory and Public Affairs Committee. applicants who have completed or are participating in a Public Education take New Mexico's hospitals away from making outcome-based health Department-approved administrator preparation program and hold a care policy decisions and replace it with a mandated quota system that is Regulatory and Government current level two license. disconnected from needs of the patient and the hospital. Additionally, HM1: ENMRD Website Oil & Gas Info (P. Caballero): This memorial Passed both the House and the Senate; signed into law by the Gover- mandated staffing legislation stifles innovation and quality care and can resolves that EMNRD’s Oil Conservation Division (OCD) post on its nor. even lead to the unintended consequence of increasing costs to the website information related to the number of active and inactive wells in HB181: Adjunct Instructors Act (C. James): This bill allowed for the patient. Staffing decisions are best made at the local hospital by New Mexico, the number of inspectors, the number of violations of the certification and contracting of adjunct instructors in the public school healthcare professionals who understand the patients' needs. Oil and Gas Act, the actions taken in response to violations, a list of oil code. The act requires background checks for instructors but other Blocked by the House Regulations and Public Affairs Committee. and gas facilities fined for violations, the cash balance in the Oil and Gas provisions of the School Personnel Act shall not apply to adjunct instruc- HB17: Health Care Coverage and ID Card Requirements (B. McCamley): Reclamation Fund, and expenditures from the fund. HM1 also resolves tors. This bill allowed the state to take advantage of New Mexico’s talent This bill required the issue of an identification card to the primary that OCD present this information with recommendations to address and will allow industry professionals to share their expertise with stu- insured, and allows the plans to issue identification cards to individuals public concerns about the impact of drilling for oil and gas on groundwa- dents in the classroom. covered under the primary insured’s coverage. The bill provides what ter to relevant interim legislative committees and the governor. Passed the House on a 31-21 vote and was given a do pass by the must be on the identification card (name, number, contact information) This memorial would have cost over $400,000 to the state to imple- Senate Education Committee, but was blocked by the Senate Judiciary and when the health plan must issue the card (within 30 days of effective ment and be costly to producers across the state. It was blocked by the Committee. date of insurance, or of any change of information). HB 17 required that House Energy, Environment and Natural Resources Committee. by July 1, 2015, the Secretary of General Services must adopt rules to Taxation establish machine readability standards for these identification cards. Minimum Wage *SB184: No STB Projects in Certain Counties (W. Sharer): This bill The implementation of this legislation will be extremely costly and will SB10: Raise Minimum Wage (C. Sanchez): This bill increased the mini- enacted a new section of the Severance Tax Bonding Act to forbid soon be archaic as hospitals and doctor offices become more dependent mum wage to $8.30 an hour. The bill does call for a lower rate of $7.50 severance tax bonds from being issued to benefit projects in counties on Electronic Health Records and other forms of IT. for trainee employees during a training period that lasts no longer than that have enacted ordinances that increase costs by 25% or more to oil, Passed the House but was not brought forward for a vote in the Senate. six months. gas, carbon dioxide, or geothermal industries. Severance tax dollars are Blocked by the Senate Public Affairs Committee. generated by the extractive industries. Counties who ban the extractive Taxation industries currently continue to benefit from the proceeds of counties HB16: Surtax on Certain Corporations (B. McCamley): This bill imposed a HB20: Raise Minimum Wage (L. Varela): This bill raised the minimum who support the industries. This would have still allowed counties the 1% Corporate Income Tax on corporations that pay their CEOs or other wage to $10.10 per hour, and provides for the minimum wage to be power to ban or heavily regulate drilling, however, it would also withhold senior officers more than 100% of the average annual salary of all other increased in accordance to the consumer price index on an annual them profiting from other counties. non-upper management employees. basis. Blocked by the Senate Conservation Committee. Blocked in the House Regulatory and Public Affairs Committee. Blocked by the House Regulatory and Public Affairs Committee. HB21: Phased-In Supplemental Income Tax (P. Caballero): This bill Water & Land Use imposed an additional 0.3% tax on single individuals, married filing HB138: Increase Minimum Wage (M. Garcia): This bill proposed the SB276: State Engineer Hearing Locations (C. Pirtle/B. Wooley): This bill separately, and estates and trusts on taxable income in excess of $100K exact same increase to $10.10 per hour with the difference of phasing it specified that a state engineer hearing can only be held in the county in in 2016. Married filing jointly, surviving spouse and head of households on over a period of time. The wage would be increased based on the which the water right at issue is adjudicated, licensed or permitted, would be taxes at the same rate on taxable income in excel of $150K. The consumer price index on an annual basis. unless the parties and the state engineer agree to another site for the tax rate increases to .8% in 2017, 10% in 2018. This bill would have a Blocked by the House Regulatory and Public Affairs Committee. hearing. ACI believes that this provides greater access to the hearing negative impact on small businesses, most of which pay PIT. process for our members. Blocked in the House Regulatory and Public Affairs Committee. HB180: Minimum Wage “Employee” Definitions (S. Maez): This bill Passed the House and the Senate; signed into law by the Governor. *SB56: Unitary Corporation Combined Tax Reporting (P. Wirth): This bill proposed to cover individuals 18 years old or younger under the New SB313: Water Rights Review & Court Hearings (S. Neville): Similar to amended the Corporate Income and Franchise Tax Act to require a Mexico Minimum Wage Act. The Act excludes individuals under the age SB276, this bill amended statues to protect certain constitutional rights unitary corporation subject to corporate income tax (CIT) to file a com- of 18 from the definition of “employee,” thereby permitting employers to and to minimize the cost and delay to water rights owners by ensuring bined return. Current law permits combined filing, but only requires it for pay them less than the statewide minimum wage. This bill would have the right to de novo review, providing for expedited determination of unitary corporations that provide retail sales of goods in a facility of more forced employers to raise the wage for workers under 18. water rights, and clarifying the scope of district court review and the than 30 thousand square feet that do not also have nonretail operations Blocked by in its first committee, House Regulatory and Public procedures for appeals to and from district court. ACI believes that a in New Mexico with at least 750 employees. As this bill required com- Affairs. more streamlined, accessible, and transparent process is crucial. bined reporting for all corporations, the bill struck the requirements Blocked by the Senate Conservation Committee. specific to these corporations. The provisions of SB 56 apply to taxable Water & Land Use years beginning on or after January 1, 2016. HB111: Shared Renewable Facilities Operations (R. Gonzales): This bill's Bills Opposed by ACI: Blocked in the Senate Corporations and Transportation Committee. stated purpose was to promote the construction and operation of *SB57: Unitary Corporation Restaurant Tax Reporting (P. Wirth): This bill "shared renewable energy facilities”, requires investor-owned utilities to Economic Development amended the Corporate Income and Franchise Tax Act to require a allow shared renewable energy facilities to operate in their areas, and HJR3: Economic Development Tax Incentives, CA (B. McCamley): This restaurant that is a unitary corporation to file a combined return. The bill provide a potential exemption from the Public Utility Act's jurisdiction for constitutional amendment proposed to amend Article 8 the Constitution defines a restaurant as a coffee shop, cafeteria or other eating establish- shared renewable energy facilities. of New Mexico by adding a new section that required that an economic ment that gives or sells food, including kitchens and catering facilities in Affordable rates are important to the business community and ACI does development tax incentive that becomes effective after January 1, 2017 which food is prepared on the premises for serving elsewhere or a bar not believe it’s fair for some people to benefit from net metering be- may not be in effect for more than ten years after its effective date area within or attached to the premises. "Restaurant" does not include a cause they are a subscriber of a Shared Renewable Facility while others without subsequent legislative action. The new section defined an private or public school cafeteria. Current law permits combined filing, have to pay for the subscribers cost to use the grid. ACI believes it’s economic development tax incentive as a credit, deduction, rebate, but only requires it for unitary corporations that provide retail sales of important that we all contribute to the use of the grid since we all are exemption or other tax benefit for the primary solution purpose of goods in a facility of more than 30 thousand square feet that do not also beneficiaries of the electric infrastructure. ACI also believes reliable promoting economic development or offering an advantage to a particu- have nonretail operations in New Mexico with at least 750 employees. electricity is important for the business community and the economy. lar industry or type of business to do business in New Mexico. The provisions of SB 57 apply to taxable years beginning on or after Our electric companies are regulated at the State and Federal level to As a reminder, a constitutional amendment does not require the Gover- January 1, 2016. make sure they provide a reasonable rate and reliable electricity to nor’s signature. ACI supports total reform of the tax code including a Blocked in the Senate Corporations and Transportation Committee. consumers. This bill allows an entity to generate electricity and sell to review of incentives. We do not believe this should be constitutionally SB75: Limit Spaceport Bond & Tax Authority (L. Cotter): This bill re- customers and not be regulated. How will we ensure that consumers are mandated. moved the bonding ability of the Spaceport Board and limits the fund protected, especially if they are not able to deliver what is expected? Blocked by the House Business and Employment Committee. allocation for bonds sold prior to July 1, 2015. In effect, this legislation Blocked by the House Energy, Environment, and Natural Resources SB131: Local Gov't IRB Notices & Impacts (M. Stewart): This bill made would override the communities who voted to tax themselves to support Committee. several changes to the IRB process including removing the requirement and grow the Spaceport. Further, even the introduction of SB 75 will that the county assessor open the process for comments for those make it more difficult to attract new customers to the Spaceport as it impacted by the bond. Other proposed changes would make IRBs less gives the appearance that the New Mexico legislature is not fully sup- attractive to private entities and harm economic development efforts. portive of the endeavor at a time when the New Mexico Spaceport Blocked by the Senate Education Committee. Authority is very actively seeking new customers that will create new jobs in the State of New Mexico.

The Voice of New Mexico Business

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Principal Investors

Patron Investors Supporting Investors

Associate Investors

Affiliate Investors

The Voice of New Mexico Business Page 18 Vol. XXV FOCUS Report 2015

About ACI Members of ACI represent small and large businesses from eve-  Agriculture and Food ry region and business sector of New Mexico. Through our poli-  Economic Development and Research & Development cy committees, ACI develops a robust policy agenda that reflects  Education and Workforce Development the needs of the statewide business community. The agenda is revised twice annually, so that our recommendations always  Energy and Extractive Industries reflect the very latest developments in the state. And our policy  Entrepreneurship positions always come straight from New Mexico businesses.  Environment We then work year-round—at the legislature in Santa Fe,  Federal through the interim session, and with countless local and region-  Health Care al governments, councils, and committees—to promote our poli-  Regulatory Reform and Government Accountability cy agenda and ensure that New Mexico’s job creators are care- fully considered in every decision made in the state.  Taxation  Water and Land Use As a testament to ACI’s respected position as the voice of New Mexico business, ACI is often called upon to represent the busi-  Work Place Issues and Legal Reform ness community ACI was the only business advocacy group in the state to be invited to serve on the well-known Legislative Jobs Council that has been so central in statewide dialogue on Thank you for your support and involvement in economic development and job creation. ACI. Your voice is what empowers us to make an As an ACI member, you ensure that your business is not forgot- impact, and your engagement is the only way New ten in the rules, legislation, and regulations that impact you eve- Mexico will achieve a brighter economic future. ry day. ACI offers the following policy committees for members to par- ticipate in and to prepare priorities for the legislative session:

New Mexico Association of Commerce and Industry 2014 - 2015 Officers & Executive Committee

PRESIDENT SECRETARY Beverlee McClure Walter Bolic MEMBERSHIP/MARKETING Ben Jaime Chris Stagg CHAIR Xcel Energy-Hobbs Taos Ski Valley, Inc. Association of Commerce Delta Dental Plan of NM Leean Kravitz Hobbs, NM Taos, NM and Industry Albuquerque, NM Fidelity Investments Albuquerque, NM Albuquerque, NM T. Greg Merrion David Seely TREASURER Merrion Oil & Gas Kirtland Federal BOARD CHAIR Janice Torrez AT LARGE MEMBERS Farmington, NM Credit Union Dan Girand Blue Cross Blue Shield of NM JR Allison Albuquerque, NM Mack Energy Albuquerque, NM Old Republic Title Insurance Derrick Jones Roswell, NM IMMEDIATE PAST CHAIR Rio Rancho, NM Lovelace Rehabilitation Don Tarry Hospital FIRST VICE CHAIR Paul DiPaola Public Service Albuquerque, NM Doug Cox US Bank Brian Brichford Company of NM

Atkinson & Co., Ltd Albuquerque, NM Hewlett-Packard Company Albuquerque, NM Steve Perich Rio Rancho, NM Albuquerque, NM Dekker/Perich/Sabatini FOCUS CHAIR Anthony D. Trujillo Albuquerque, NM SECOND VICE CHAIR Allison Kuper Smith John Chavez Holman’s USA LLC

Lillian Montoya Kuper, Smith, & Associates LLC Sandia Peak Tram Company Albuquerque, NM David Seely Christus St. Vincent Regional Medical Las Cruces, NM Albuquerque, NM Kirtland Federal Credit Center Tony Trujillo Union Santa Fe, NM Valerie Dodd Freeport- GOVERNMENT AFFAIRS CHAIR Albuquerque, NM CenturyLink McMoRan Inc. Danny Jarrett Albuquerque, NM Silver City, NM Jackson Lewis P.C.

Albuquerque, NM

The Voice of New Mexico Business Vol. XXV Page 19

New Mexico Association of Commerce and Industry PO Box 9706 Albuquerque, NM 87119-9706 505-842-0644 [email protected]

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New Mexico Association of Commerce and Industry