SB 294 — PUBLIC PEACE, HEALTH, SAFETY & WELFARE

SB0294COS SENATE CONSERVATION COMMITTEE SUBSTITUTE FOR SENATE BILL 294 56TH56th LEGISLATURElegislature -STATEOFNEWMEXICO-- SECONDSTATE SESSIONOF ,NEW MEXICO - second session, 2024 INTRODUCED  BY  Elizabeth  "Liz"  Stefanics  and  George  K.AN ACT RELATING TO THE PUBLIC PEACE, HEALTH, SAFETY AND WELFARE;

MuñozCREATING andTHE WilliamSTRATEGIC E.WATER SUPPLY PROGRAM;

SharerPROVIDING 7FOR 9THE ANSTATE ACTBOARD RELATINGOF FINANCE TO ISSUE SEVERANCE TAX BONDS FOR THE PUBLICDEPARTMENT PEACE,OF HEALTH,ENVIRONMENT SAFETYTO ENTER INTO CONTRACTS TO ACQUIRE AND WELFARE.MANAGE TREATED BRACKISH WATER;

13MAKING BEAN ITAPPROPRIATION. ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

15  eBE tIT 17ENACTED wBY lTHE nLEGISLATURE dOF 18THE =STATE =OF 19NEW aMEXICO: l i a e r 20 a t m m 21 d r e 22 c e s k 23 e a n b 24 u [ .227343.1

     SECTION 1.

A new section of Chapter 75 NMSA 1978 is enacted to read:

     "[NEW MATERIAL] STRATEGIC WATER SUPPLY PROGRAM CREATED--SEVERANCE TAX BONDS AUTHORIZED.--           A.

The "strategic water supply program" is created to reduce reliance on limited freshwater resources while furthering clean energy and advanced manufacturing development that meaningfully contributes to the state achieving a measurable reduction in greenhouse gas emissions.

The department of environment shall administer the strategic water supply program.

          B.

The state board of finance may issue or sell severance tax bonds in accordance with the Severance Tax Bonding Act in fiscal years 2025 through 2027 in amounts not to exceed a total of one hundred million dollars ($100,000,000);

provided that the issuance or sale of the bonds is specifically authorized by law by the first session of the fifty-seventh legislature;

and further provided that the department of environment, with concurrence from the office of the state engineer, the Indian affairs department and the economic development department, certifies the need for the issuance of bonds to the state board of finance;

and provided further that the state board of finance shall only issue bonds with a term that does not extend beyond the fiscal year in which they are issued.

The proceeds from the sale of the bonds are appropriated to the department of environment to enter into valid contracts in accordance with the Procurement Code to acquire and manage treated brackish water.

          C.

In certifying the need for the issuance of bonds or notes to the state board of finance, the department of environment shall demonstrate that:

                (1) the price to be paid for treated brackish water through the strategic water supply program represents a fair market value as determined by a market analysis of comparable sales;

                (2) the department will consult with the office of the state engineer, the Indian affairs department and potentially impacted Indian nations, tribes and pueblos and has determined that a brackish water treatment project will not impair existing water rights or adversely impact landowners;

and                 (3) a selected contractor has demonstrated technology to treat water that meets applicable standards for water quality established by the water quality control commission pursuant to the Water Quality Act.

          D.

Any unencumbered balance from the proceeds of bonds authorized pursuant to this section shall revert to the severance tax bonding fund two years from the issuance date of those bonds.

          E.

Fifty percent of state proceeds that result from the sale of treated brackish water acquired pursuant to this section shall be deposited in the severance tax bonding fund and fifty percent shall be deposited in the general fund.

          F.

Brackish water treatment projects associated with the strategic water supply program shall comply with applicable state, tribal and local governmental standards, permit requirements and other provisions of law to protect the environment and public health.

          G.

By September 1, 2024 and semiannually thereafter, the department of environment shall report on the implementation of the strategic water supply program to the legislative finance committee and the appropriate legislative interim committee dealing with natural resources.

          H.

As used in this section, "treated brackish water" means water that:

                (1) is sourced from an aquifer, the top of which is at a depth of two thousand five hundred feet or more below the surface of the ground;

                (2) contains not less than one thousand parts per million of dissolved solids;

and                 (3) has undergone a process to remove or eliminate contaminants to meet applicable standards for water quality established by the water quality control commission pursuant to the Water Quality Act." - 4 -