SB 167 — EARLY CHILDHOOD TRUST FUND

SENATE BILL 167 57TH LEGISLATURE -STATEOFNEWMEXICO-- STATEOFNEWMEXICO- FIRST SESSION, 2025 INTRODUCED BY Michael Padilla 6This 8document 10may ANincorporate ACTamendments RELATINGproposed TOby EARLYa CHILDHOODcommittee, FUNDING;but not yet adopted, as well as amendments that have been adopted during the current legislative session.

TRANSFERRINGThe THEdocument BALANCEis OFa THEtool EARLYto CHILDHOODshow EDUCATIONamendments ANDin CAREcontext FUNDand TOcannot THEbe EARLYused CHILDHOODfor TRUSTthe FUND;purpose of adding amendments to legislation.

RECOMPILINGh ANDAN AMENDINGACT CERTAINg o RELATING TO EARLY CHILDHOOD FUNDS;FUNDING;

EXPANDINGTRANSFERRING THE PURPOSESBALANCE FORt WHICHhr MONEYg INe i k OF THE FUNDSEARLY MAYCHILDHOOD BEEDUCATION USEDAND CARE FUND TO INCLUDETHE PRENATALEARLY PROGRAMSh ANDr SERVICES;i s CHILDHOOD TRUST FUND;

PROVIDINGRECOMPILING ANAND EFFECTIVEAMENDING DATECERTAIN CONTINGENTEARLY ONh APPROVAL, OFt, A e t 17 CONSTITUTIONAL AMENDMENT CREATING THE EARLY CHILDHOOD TRUSTFUNDS; w l n d 18 FUND.

=EXPANDING =THE 19PURPOSES aFOR lWHICH iMONEY aIN THE e ru 20g BEe ITb ENACTEDl BYe THEe LEGISLATUREh OFFUNDS THEMAY STATEBE OFUSED NEWTO MEXICO:INCLUDE PRENATAL PROGRAMS AND SERVICES;

n d d i = = o h PROVIDING AN EFFECTIVE DATE CONTINGENT ON APPROVAL OF A l ] b ,d i a º e CONSTITUTIONAL AMENDMENT CREATING THE EARLY CHILDHOOD TRUST r i = r t me w d m 21a SECTIONn 1.o FUND.

Section 6-4-27 NMSA 1978 (being Laws 2020, d rm e: 22 Chapter 3, Section 4, as amended) is amended to read:

cb e d s º o t n = .229674.3SAAIC February 19, 2025 (9:10pm) s k 23m "6-4-27.e e a n e d r e l u [ A d BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

EXCESSSECTION EXTRACTION1. TAXES SUSPENSE FUND--TRANSFER e a n b 24 OF EXCESS OIL AND GAS EMERGENCY SCHOOL TAX REVENUE--TAX u [ STABILIZATION RESERVE--EARLY CHILDHOOD [EDUCATION AND CARE] .229674.3SA TRUST FUND--SEVERANCE TAX PERMANENT FUND.-- A.

Section 6-4-27 NMSA 1978 (being Laws 2020, Chapter 3, Section 4, as amended) is amended to read:

"6-4-27.

EXCESS EXTRACTION TAXES SUSPENSE FUND--TRANSFER OF EXCESS OIL AND GAS EMERGENCY SCHOOL TAX REVENUE--TAX STABILIZATION RESERVE--EARLY CHILDHOOD [EDUCATION AND CARE ] TRUST FUND--SEVERANCE TAX PERMANENT FUND.-- A.

(1) if in the current fiscal year the total h g net receipts attributable to the tax imposed pursuant to o t hr Section 7-31-4 NMSA 1978 and distributed pursuant to Section g e i k 7-1-6.20 NMSA 1978 exceed the annual average amount, the h r i s h department shall distribute the excess amount above the annual , t, e u g average amount as follows:

e b l e e h (a) to the tax stabilization reserve, en td 17d i = = o h the amount necessary to bring the balance of state reserves to w l n] db 18,d i a º e r i = r a level equal to twenty-five percent of the aggregate recurring =t =e 19w d m a ln o appropriations for that fiscal year from the general fund, as id am e: r 20 determined by the department;

providedb that,e ifd thes balanceº ino a t mn m= 21.229674.3SAAIC theFebruary excess19, extraction2025 taxes(9:10pm) suspenses fundk ism note sufficient- to2 d- r e 22a meetn thate level,d ther entiree balancel shallu be[ transferredA tod thedetermined cby ethe sdepartment; k 23 tax stabilization reserve;

andprovided ethat, aif n b 24 (b) to the early childhood [education u [ and care] trust fund, the balance ofin the excess amountextraction abovetaxes .229674.3SAsuspense -fund 2is -not thesufficient annualto averagemeet amount,that iflevel, any, after the transferentire isbalance madeshall pursuantbe transferred to Subparagraphthe (a)tax ofstabilization thisreserve; paragraph;

and (b) to the early childhood [education and care] trust fund, the balance of the excess amount above the annual average amount, if any, after the transfer is made pursuant to Subparagraph (a) of this paragraph;

and (2) "state reserves" means the general fund h g balances, as determined by the department of finance and o t hr administration, including all authorized revenues and transfers g e i k to the general fund and balances in the appropriation h r i s contingency fund, the general fund operating reserve, the h , t, e u g state-support reserve fund and the tax stabilization reserve." e tb 17l e e h SECTION 2.

Section 9-29A-3 NMSA 1978 (being Laws 2020, w l n d 18d i = = o h Chapter 3, Section 3, as amended) is recompiled as Section =l =] 19b ,d i a lº e r i = r 6-4-27.1 NMSA 1978 and is amended to read:

it a e rw 20d m a n o "6-4-27.1.

DISTRIBUTION--EARLY CHILDHOOD [EDUCATION AND ad t m m: 21 CARE] TRUST FUND--SEVERANCE TAX PERMANENT FUND--PAYMENTS d r e 22 PURSUANT TO FEDERAL MINERAL LEASING ACT.-- c e s k 23 A.

If,b bye Juned 30s ofº eacho fiscalt year, the net e a n b= 24.229674.3SAAIC receiptsFebruary for19, that2025 fiscal(9:10pm) years ofk them moneye received by the u [ state pursuant to the federal Mineral Leasing Act exceed the .229674.3SA - 3 - annuale averagea amount,n thee excessd amountr abovee thel annualu average[ amountA shalld beCARE] distributedTRUST toFUND--SEVERANCE theTAX earlyPERMANENT childhoodFUND--PAYMENTS [educationPURSUANT andTO care]FEDERAL trustMINERAL fundLEASING andACT.-- attributedA. to that fiscal year.

If, by June 30 of each fiscal year, the net receipts for that fiscal year of the money received by the state pursuant to the federal Mineral Leasing Act exceed the annual average amount, the excess amount above the annual average amount shall be distributed to the early childhood [education and care ] trust fund and attributed to that fiscal year.

If, by [June 30, 2025, and by]by ] June 30 of each fiscal year, [thereafter][thereafter ] the remaining amount of the net receipts for that fiscal year of the money received by the state pursuant to the federal Mineral Leasing Act after the distribution pursuant to Subsection A of this section exceeds the threshold amount, the excess shall be distributed to the severance tax permanent fund.

The department of finance and administration h g shall make the calculations to determine if excess amounts o t hr shall be distributed pursuant to this section.

If there is an g e i k excess amount, the distribution shall be made as soon as h r i s practicable.

If there is not an excess amount, no distribution h , t, e tu 17g shall be made.

we b l ne de 18h D.

n d d i = = 19o ah l (1) "annual average amount" means the total l ] b ,d i a º e r 20i = r net receipts attributable to money received by the state a t me w d m 21a n o pursuant to the federal Mineral Leasing Act in the immediately d rm e: 22 preceding five fiscal years, divided by five;

andb c e d s kº 23o (2)t "thresholdn amount"= means.229674.3SAAIC theFebruary net19, receipts2025 e(9:10pm) as nk bm 24e of- the4 money- receivede bya then statee pursuantd tor thee federall u [ MineralA Leasingd Actpreceding distributedfive in fiscal yearyears, 2024divided pursuantby tofive; .229674.3SA - 4 - Subsection B of Section 22-8-34 NMSA 1978." SECTION 3.

and (2) "threshold amount" means the net receipts of the money received by the state pursuant to the federal Mineral Leasing Act distributed in fiscal year 2024 pursuant to Subsection B of Section 22-8-34 NMSA 1978." SECTION 3.

EARLY CHILDHOOD [EDUCATION AND CARE]CARE ] TRUST FUND.-- A.

The early childhood [education and care]care ] trust fund [is created within the state treasury.

Money in the fund shall be expended only as [provided in this section]section ] authorized by Article 20, Section h g 23 of the constitution of New Mexico.

o t hr B.

The state investment officer, subject to the g e i k approval of the state investment council, shall invest money in eh tr 17i s the [early childhood education and care]care ] fund:

wh l, nt, de 18u g (1) in accordance with the prudent investor =e =b 19l ae le h rule set forth in the Uniform Prudent Investor Act;

and n d d i a= e= ro 20h (2) in consultation with the [state treasurer]treasurer ] l ] b ,d i a tº me mr 21i = r secretary of early childhood education and care.care .

t e w d rm ea 22n o C.