HB 7 — OPPORTUNITY ENTERPRISE ACT

n d d i = = o h (1) survey potential opportunity enterprise l ] b ,d i a º e partners and enterprise development projects;

r(2) iprovide =outreach rservices tto elocal wgovernments dand mpotential aopportunity nenterprise opartners (2)for providethe outreachpurpose servicesof tomaking localrecommendations dregarding menterprise :assistance;

b e d s º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 5 - e a n e d r e l u [ A d governments and potential opportunity enterprise partners for the purpose of making recommendations regarding enterprise assistance;

[NEW MATERIAL ] OPPORTUNITY ENTERPRISE REVIEW HB 7/a Page 5 BOARD--CREATED--MEMBERSHIP.-- A.

h B.

The board is composed of the following twelve g o t hr members:

g e i k (1) the secretary of economic development or h r i s the secretary's designee;

h , t, (2) the secretary of finance and e u g e b l e e h administration or the secretary's designee;

n d d i = = o h (3) the secretary of general services or the l ] b ,d i a º e secretary's designee;

r i = r t e w d m a n o (4) the state treasurer or the state dtreasurer's mdesignee; :

b e d s º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 6 - e a n e d r e l u [ A d treasurer's designee;

HB 7/a Page 6 (d) commercial real estate development;

h (g) urban planning;

or g o t hr (h) environmentally sustainable g e i k construction and development.

h r i s C.

Members of the board appointed pursuant to h , t, Paragraphs (6) and (7) of Subsection B of this section shall e u g e b l e e h serve for staggered terms of six years;

provided that the n d d i = = o h initial term of members appointed pursuant to Paragraph (7) of l ] b ,d i a º e Subsection B of this section may be for a term of less than six r i = r t e w d m a n o years, as determined by the New Mexico legislative council, to densure mstaggered :membership of the board.

b e d s º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 7 - e a n e d r e l u [ A d ensure staggered membership of the board.

Members of the board appointed pursuant to HB 7/a Page 7 Paragraphs (6) and (7) of Subsection B of this section shall:

h E.

The members shall select a chair, vice chair and g o t hr other officers that the board deems necessary, who shall serve g e i k a term of two years.

The board shall maintain minutes of all h r i s meetings of the board, and all meetings shall be held pursuant h , t, to the Open Meetings Act.

e u g e b l e e h SECTION 6.

[NEW MATERIAL ] OPPORTUNITY ENTERPRISE REVIEW n d d i = = o h BOARD--POWERS.-- l ] b ,d i a º e A.

r i = r t e w d m a n o (1) meet quarterly and at the call of the dchair; m :

b e d s º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 8 - e a n e d r e l u [ A d chair;

(5) make recommendations to the authority of potential enterprise development HCEDCºprojects; projects»HCEDC;

(6) determine whether the use of enterprise assistance is a prudent expenditure of public funds and HB 7/a Page 8 report to the legislature annually on that determination;

h B.

The board and the department shall coordinate g o t hr to:

g e i k (1) provide outreach services to local h r i s governments and potential opportunity enterprise partners;

h , t, (2) evaluate opportunity enterprise partners e u g e b l e e h and eligible enterprise development projects for suitability n d d i = = o h for enterprise assistance;

and l ] b ,d i a º e (3) obtain input and information relevant to r i = r t e w d m a n o carrying out the purposes of the Opportunity Enterprise Act dfrom mrecipients :of enterprise assistance, local governments and local communities.

b e d s º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 9 - e a n e d r e l u [ A d from recipients of enterprise assistance, local governments and local communities.

[NEW MATERIAL ] RULEMAKING--BOARD.--The board shall adopt rules necessary to carry out the provisions of the Opportunity Enterprise Act to:

HB 7/a Page 9 D.

provide safeguards to protect public money and other public resources subject to the Opportunity Enterprise h Act.

g o t hr SECTION 8.

[NEW MATERIAL ] ENTERPRISE ASSISTANCE--GENERAL g e i k REQUIREMENTS.-- h r i s A.

h , t, (1) describe the scope and plans of the e u g e b l e e h enterprise development project or proposed use of leased n d d i = = o h property by the applicant;

l ] b ,d i a º e (2) demonstrate that the enterprise r i = r t e w d m a n o development project or lease will create or expand economic ddevelopment mopportunities :within the state;

b e d s º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 10 - e a n e d r e l u [ A d development opportunities within the state;

HB 7/a Page 10 (1) make the application publicly available, including a description of the scope and plans of the proposed enterprise development project or lease;

(2) ensure that all information relating to the enterprise development project or lease and the evaluation h of the application is made publicly available, unless the g o t hr information includes trade secrets or information that is g e i k otherwise unable to be disclosed as provided by law;

h r i s (3) prioritize applications for enterprise h , t, assistance that demonstrate local support and financial need;

e u g e b l e e h and n d d i = = o h (4) prior to providing enterprise assistance, l ] b ,d i a º e determine that:

r(a) ithe =proposed renterprise tdevelopment eproject wor dlease mwill acreate nor oexpand (a)economic the proposed enterprise development dopportunities mwithin :the state;

b e d s º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 11 - e a n e d r e l u [ A d project or lease will create or expand economic development opportunities within the state;

(1) define the roles and responsibilities of HB 7/a Page 11 the authority and the opportunity enterprise partner;

(3) provide a finance plan detailing the financial contributions and obligations of the authority and h opportunity enterprise partner;

g o t hr (4) require an opportunity enterprise partner g e i k to provide guarantees, letters of credit or other acceptable h r i s forms of security, as determined by the authority;

h , t, (5) specify how rents, if applicable, will be e u g e b l e e h collected and accounted for;

n d d i = = o h (6) specify how debts incurred on behalf of l ] b ,d i a º e the opportunity enterprise partner will be repaid;

and r i = r t e w d m a n o (7) provide that, in the event of a default, dthe mauthority :may:

b e d s º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 12 - e a n e d r e l u [ A d the authority may:

The authority may require any document, guarantee or certification from a recipient of enterprise assistance that the authority determines is necessary to HB 7/a Page 12 ensure economic development opportunities are advanced by the enterprise assistance.

Hfl2º E.

The authority may prioritize an application for enterprise assistance for a proposed enterprise development project located in a nonurban community.»Hfl2community. Hfl2ºE.»Hfl2 Hfl2ºF.»Hfl2 Enterprise assistance h shall only be provided if compliant with the Opportunity g o t hr Enterprise Act.

AllF. contracts for enterprise assistance shall g e i k be provided to the board no later than thirty days from the h r i s execution of that contract.

hEnterprise ,assistance t,shall eonly ube gprovided Hfl2ºif G.compliant with the Opportunity Enterprise Act.

AsAll usedcontracts infor thisenterprise section,assistance "nonurbanshall ebe bprovided l e e h community" means a municipality with a population of less than n d d i = = o h forty thousand according to the mostboard recentno federallater decennialthan lthirty ]days bfrom ,d i a º e r i = r census or the unincorporatedexecution area of athat county.»Hfl2contract. t e w d m a n o SECTION 9.

[NEWG. MATERIAL] OPPORTUNITY ENTERPRISE d m :

bAs eused din sthis ºsection, o"nonurban tcommunity" nmeans =a .221216.2AICmunicipality Februarywith 14,a 2022population (3:50pm)of sless kthan mforty ethousand -according 13to -the emost arecent nfederal edecennial dcensus ror ethe lunincorporated uarea [of Aa dcounty. FINANCING.-- A.

SECTION 9.

OPPORTUNITY ENTERPRISE FINANCING.-- A.

The authority shall ensure that all zoning, permitting and other regulatory requirements will be met by the enterprise development project and that the enterprise development project will create or expand economic HB 7/a Page 13 development opportunities within the state.

A property associated with the enterprise development project shall be the property of the h authority and shall be a property available for lease as g o t hr provided in Section 10 of the Opportunity Enterprise Act.

The g e i k authority may enter into agreements with the general services h r i s department or other state agency or entity approved by the h , t, board to administer and maintain the property as required by e u g e b l e e h the Opportunity Enterprise Act.

n d d i = = o h D.

Hfl1ºUpon»Hfl1As Hfl1ºAs provided in rules ladopted ]by bthe ,dboard, iupon acompletion ºof ean adoptedenterprise bydevelopment project, the board,authority upon»Hfl1shall completionallow ofthe anopportunity enterprise rpartner iresponsible =for rthe tcompletion eof wthat dproject man aopportunity nto oobtain developmentan project,opportunity theenterprise authoritylease shallfor allowthat theproperty opportunityas dprovided min :Section 10 of the Opportunity Enterprise Act;

bprovided ethat dany sbreach ºof othe tterms nof =the .221216.2AICcontract Februaryfor 14,opportunity 2022enterprise (3:50pm)financing smay kpreclude mthat eopportunity -enterprise 14partner -from eleasing athe nproperty, eand din rthat eevent, lthe uproperty [shall Abe dmade enterpriseavailable partner responsible for thelease completion of that project an opportunity to obtainother an opportunity enterprise leasepartners. for that property as provided in Section 10 of the Opportunity Enterprise Act;

provided that any breach of the terms of the contract for opportunity enterprise financing Hfl1º shall»Hfl1 Hfl1ºmay»Hfl1 preclude that opportunity enterprise partner from leasing the property, and Hfl1ºthat»Hfl1 Hfl1ºin that event, the»Hfl1 property shall be made available for lease to other opportunity enterprise partners.

[NEW MATERIAL ] OPPORTUNITY ENTERPRISE LEASE--LEASE--TERMS.-- TERMS.-- A.

If the HB 7/a Page 14 authority determines that an opportunity enterprise partner is eligible for an opportunity enterprise lease, the authority may h enter into a contract to lease an available property to that g o t hr opportunity enterprise partner in exchange for rent payments, g e i k subject to the terms provided by this section.

The authority h r i s may enter into agreements with the general services department h , t, e u g or other state agency or entity approved by the board to e b l e e h administer an opportunity enterprise lease.

n d d i = = o h B.

l ] b ,d i a º e (1) require that the property be used solely r i = r t e w d m a n o to create and expand economic development opportunities;

d(2) mprovide, :based on the fair market value of the property, for:

b e d s º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 15 - e a n e d r e l u [ A d Hfl1º(2) provide for sufficient rent and other securities to ensure the maintenance and protection of the property based on the fair market value of that property;»Hfl1 Hfl1º(2) provide, based on the fair market value of the property, for:

and (b) other securities to ensure the maintenance and protection of the property;»Hfl1property; (3) require that the property be properly insured for the duration of the lease;

(3) require that the property be properly insured for the duration of the lease;

Receipts from the payment of rent owed pursuant to an opportunity enterprise lease shall be deposited in the h fund.

gHB o7/a tPage hr15 SECTION 11.

[NEW MATERIAL ] OPPORTUNITY ENTERPRISE LOANS-- g e i k TERMS--REPAYMENT.-- h r i s A.

The authority shall receive and review h , t, e u g applications for opportunity enterprise loans.

The authority e b l e e h may make loans to opportunity enterprise partners if:

n d d i = = o h (1) funding is available;

l ] b ,d i a º e r i = r (2) the opportunity enterprise partner meets t e w d m a n o credit and identification criteria, as determined by the dauthority; m :

b e d s º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 16 - e a n e d r e l u [ A d authority;

The loans shall bear an annual interest rate of HCEDCº no less than»HCEDCthan zero percent.

Beginning HCEDCºon»HCEDCno HCEDCºno later than»HCEDCthan the third anniversary of the funding date of the h loan, payment on the outstanding principal of the loan shall be g o t hr due on a schedule determined HB 7/a Page 16 by the authority for the remainder g e i k of the loan period.

h r i s E.

Receipts from the repayment of opportunity h , t, e u g enterprise loans shall be deposited in the fund.

e b l e e h F.

No provision in an opportunity enterprise loan n d d i = = o h or the evidence of indebtedness of the loan shall include a l ] b ,d i a º e penalty or premium for prepayment of the balance of the r i = r t e w d m a n o indebtedness.

dG. m :

b e d s º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 17 - e a n e d r e l u [ A d HCEDCºG.

A guarantee pursuant to this subsection shall be provided subject to terms approved by the board.»HCEDCboard. SECTION 12.

[NEWSECTION MATERIAL]12. OPPORTUNITY ENTERPRISE REVOLVING FUND--CREATED--PERMITTED USES.-- A.

OPPORTUNITY ENTERPRISE REVOLVING FUND--CREATED--PERMITTED USES.-- A.

The fund consists of appropriations, distributions, transfers, gifts, grants, donations, bequests, fees collected, payments of principal Hfl1º and interest»Hfl1interest on opportunity enterprise loans, income from rents paid on opportunity enterprise leases, income from investment of the fund and any other money distributed or h otherwise allocated to the fund.

Balances in the fund at the u » r end of a fiscal year shall not revert to the general fund tHB h7/a gPage e17 l i except as provided in Section 13 of the Opportunity Enterprise h r i s Act.

The fund shall be administered by the authority as a h , e h separate account and may consist of such subaccounts as the t u g e b l e e , gh authority deems necessary to carry out the purposes of the n d d i = = o h fund.

l ] b ,d i a º r B.

Money in the fund shall be used by the authority e r = t e w d m a n o to carry out the provisions of the Opportunity Enterprise Act, dincluding mto: :

b r e t º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 18 - e a n e d r e l u [ A d including to:

[NEW MATERIAL ] EXCESS REVENUE TO THE GENERAL FUND--OPPORTUNITY ENTERPRISE REVOLVING FUND--TRANSFER.-- A.

If, on June 30, 2028 and by June 30 of each fiscal year thereafter, the balance in the fund for that fiscal year exceeds the annual average amount by an amount greater h than six percent, the amount in excess of six percent shall be g o t hr transferred to the general fund.

If there is not an excessHB g7/a ePage i18 kexcess amount pursuant to this section, no transfer shall be made from h r i s the fund.

h , t, B.

As used in this section, "annual average amount" e u g e b l e e h means the total balance of the fund in the immediately n d d i = = o h preceding five fiscal years, divided by five.

l ] b ,d i a º e SECTION 14.

[NEW MATERIAL ] REPORTS.-- r i = r t e w d m a n o A.

Prior to October 1, 2023 and each succeeding dOctober m1 :thereafter, the authority shall submit a report to the governor, the legislature, the legislative finance committee, the New Mexico finance authority oversight committee, the revenue stabilization and tax policy committee and other appropriate legislative interim committees.

b e d s º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 19 - e a n e d r e l u [ A d October 1 thereafter, the authority shall submit a report to the governor, the legislature, the legislative finance committee, the New Mexico finance authority oversight committee, the revenue stabilization and tax policy committee and other appropriate legislative interim committees.

(3) an overview of the industries and types ofHB h7/a Page 19 of business entities operating pursuant to an enterprise u » r development project or lease;

t h g e l i (4) the total number of employees currently h r i s employed directly or indirectly related to an enterprise h , e h development project or lease;

and t u g e b l e e , gh (5) any recommended changes to the Opportunity n d d i = = o h Enterprise Act to ensure proper safeguards for public money and l ] b ,d i a º r to ensure enterprise assistance is able to efficiently advance e r = t e w d m a n o the economic development interests of the state.

dB. m :

b r e t º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 20 - e a n e d r e l u [ A d B.

provided that nothing shall prevent the authority from disclosingdisclosing: Hfl1º information required by this section, the names of persons that have received enterprise assistance and the amount of enterprise assistance provided pursuant to the Opportunity Enterprise Act.»Hfl1 Hfl1º:»Hfl1 Hfl1º(1) information required in the report pursuant to this section;

(1) information required in the report pursuant to this section;

and (3) the names of persons that have received enterprise assistance and the amount of enterprise assistance provided pursuant to the Opportunity Enterprise Act.»Hfl1Act. h g SECTION 15.

[NEWSECTION MATERIAL]15. CONFLICT OF INTEREST.-- o t hr A.

IfCONFLICT aOF memberINTEREST.-- ofA. the board or an employee of the g e i k authority has an interest, either direct or indirect, in an h r i s h application Hfl1º for»Hfl1 Hfl1ºor»Hfl1 contract relating to , t, e u g enterprise assistance, that interest shall be disclosed to the e b l e e h authority and the board in writing.

TheIf persona havingmember suchof nthe dboard dor ian =employee =of othe hHB interest7/a shallPage not20 participateauthority inhas actionsan byinterest, theeither boarddirect or theindirect, lin ]an bapplication ,dor icontract arelating ºto eenterprise rassistance, ithat =interest rshall be disclosed to the authority withand respectthe toboard thatin conflict.writing.

tThe eperson whaving dsuch minterest ashall nnot oparticipate B.in actions by the board or the authority with respect to that conflict.

AB. person who has a conflict of interest and d m :

bA eperson dwho shas º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k m e - 21 - e a nconflict eof dinterest rand e l u [ A d participates in aan action involving that conflict of interest or knowingly fails to notify the authority and the board in writing of that conflict is guilty of a misdemeanor and upon conviction shall be sentenced pursuant to the provisions of Section 31-19-1 NMSA 1978.

-HB 227/a -Page »21 g25 o » r h t i k l i g t h s , e h t l i w l b l e e , g n d l h = = b , a l º d i a r e r = , a t e d m a n o d m :

b r e t º o t n = .221216.2AIC February 14, 2022 (3:50pm) s k em e e a n e d r e l u [ A d