SB 3 — EARLY CHILDHOOD EDUCATION & CARE FUND

AsB. used in this section, "annual average amount" t e a t means the total net receipts attributable to money received by m m 21 e d r e 22 the state pursuant to the federal Mineral Leasing Act in the c e r c 23 immediately preceding five fiscal years, divided by five.

eAs aused nin bthis 24section, SECTION"annual 4.average amount" means the total net receipts attributable to money received by the state pursuant to the federal Mineral Leasing Act in the immediately preceding five fiscal years, divided by five.

SectionSFCº 7-1-6.20SECTION NMSA4. 1978 (being Laws 1985, u [ Chapter 65, Section 6, as amended) is amended to read:

.216643.1A -new section of Chapter 6, Article 4 -NMSA "7-1-6.20.1978 is enacted to read:

IDENTIFICATION"[NEW OFMATERIAL] MONEYEXCESS IN EXTRACTION TAXES SUSPENSE FUND--DISTRIBUTION.--FUND--TRANSFER OF EXCESS OIL AND GAS EMERGENCY SCHOOL TAX REVENUE--TAX STABILIZATION RESERVE--EARLY CHILDHOOD EDUCATION AND CARE FUND.-- A.

ExceptThe as"excess provided in Subsection B of this section, after the necessary disbursements have been made from the extraction taxes suspense fund,fund" theis moneyh remainingcreated inas thea suspensenonreverting fund as of the last day of the month shall be identified by tax source and distributed or transferred in accordance with the provisionsstate oftreasury. Sections 7-1-6.21 through 7-1-6.23 [NMSA 1978 ] and [Section 3 of this 2017 act] 7-1-6.61 NMSA 1978.

Money in g o t hr the fund shall only be used to make transfers by the department g e i k of finance and administration as required by this section.

h r i s B.

At the end of each fiscal year, the department h , t, e u g of finance and administration shall transfer the balance of the e b l e e h fund attributable to that fiscal year as follows:

n d d i = = o h (1) to the tax stabilization reserve, the l ] b ,d i a º e r i = r amount necessary to bring the balance of state reserves to a t e w d m a n o level equal to twenty-five percent of the aggregate recurring d m :

b e d s º o t n = .216643.1AIC January 28, 2020 (9:56am) s k m e - 5 - e a n e d r e l u [ A d appropriations for that fiscal year from the general fund, as determined by the department;

provided that, if the balance in the excess extraction taxes suspense fund is not sufficient to meet that level, the entire balance shall be transferred to the tax stabilization reserve;

and (2) to the early childhood education and care fund, the balance remaining in the excess extraction taxes suspense fund, if any, after the transfer is made pursuant to Paragraph (1) of this subsection.

C.

As used in this section, "state reserves" means the general fund balances, as determined by the department of finance and administration, including all authorized revenues and transfers to the general fund and balances in the appropriation contingency fund, the general fund operating reserve, the state-support reserve fund, the tax stabilization reserve and the tobacco settlement permanent fund."»SFC h SECTION SFCº4»SFC SFCº5»SFC.

Section 7-1-6.20 NMSA 1978 u » r t h (being Laws 1985, Chapter 65, Section 6, as amended) is amended g e l i to read:

h r i s "7-1-6.20.

IDENTIFICATION OF MONEY IN EXTRACTION TAXES h , e h t u g SUSPENSE FUND--DISTRIBUTION.-- e b l e e , gh A.

Except as provided in Subsection B of this n d d i = = o h section, after the necessary disbursements have been made from l ] b ,d i a º r e r = the extraction taxes suspense fund, the money remaining in the t e w d m a n o suspense fund as of the last day of the month shall be d m :

b r e t º o t n = .216643.1AIC January 28, 2020 (9:56am) s k m e - 6 - e a n e d r e l u [ A d identified by tax source and distributed or transferred in accordance with the provisions of Sections 7-1-6.21 through 7-1-6.23 [NMSA 1978 ] and [Section 3 of this 2017 act] 7-1-6.61 NMSA 1978.

Payments on assessments issued by the department pursuant to the Oil and Gas Conservation Tax Act, the Oil and Gas Emergency School Tax Act, the Oil and Gas Ad Valorem Production Tax Act and the Oil and Gas Severance Tax Act shall e e 17 be held in the extraction taxes suspense fund until the e e n d 18 secretary determines that there is no substantial risk of = = l ] 19 protest or other litigation, whereupon after the necessary a l r i 20 disbursements have been made from the extraction taxes suspense t e a t fund, the money remaining in the suspense fund as of the last m m 21 e d r e 22 day of the month attributed to these payments shall be ch e r c 23 identified by tax source and distributed or transferred in eg ao nt bhr 24 accordance with the provisions of Sections 7-1-6.21 through ug [e i k 7-1-6.23 [NMSA 1978 ] and [Section 3 of this 2017 act] 7-1-6.61 .216643.1h -r 5i -s NMSA 1978.

After the necessary distributions and transfers, h , t, any balance, except for remittance unidentified as to source or e u g e b l e e h disposition, shall be transferred to the general fund." n d d i = = o h SFCº SECTION 5.

Section 7-1-6.61 NMSA 1978 (being Laws l ] b ,d i a º e 2017 (1st S.S.), Chapter 3, Section 3) is amended to read:

r i = r t e w d m a n o "7-1-6.61.

DISTRIBUTION--TAX STABILIZATION RESERVE FROM THEd OILm AND: GAS EMERGENCY SCHOOL TAX--EARLY CHILDHOOD EDUCATION AND CARE FUND.-- A.

Ab distributione pursuantd tos Sectionº 7-1-6.20o NMSAt 1978n shall= be.216643.1AIC madeJanuary [to28, the2020 tax(9:56am) stabilizations reservek ]m ine an- amount7 as- calculatede pursuanta ton Subsectione Bd ofr thise section.l u [ A d THE OIL AND GAS EMERGENCY SCHOOL TAX--EARLY CHILDHOOD EDUCATION AND CARE FUND.-- A.

A distribution pursuant to Section 7-1-6.20 NMSA shall be made [to the tax stabilization reserve] in an amount as calculated pursuant to Subsection B of this section.

e e 17 (1) equal to or greater than twenty-five e e n d 18 percent of the aggregate recurring appropriations for the = = l ] 19 current fiscal year from the general fund as determined by the a l r i 20 department of finance and administration, then the excess t e a t revenue shall be distributed to the early childhood education m m 21 e d r e 22 and care fund as soon as practicable;

or ch e r c 23 (2) less than twenty-five percent of the eu a» nr bt 24h aggregate recurring appropriations for the current fiscal year ug [e l i from the general fund as determined by the department of .216643.1h -r 6i -s finance and administration, then the excess amount distributed h , e h t u g to the tax stabilization reserve shall be limited to the amount e b l e e , gh necessary to bring the balance equal to twenty-five percent of n d d i = = o h l ] b ,d the aggregate recurring appropriations from the general fund as i a º r e r = determined by the department of finance and administration and 6t anye remainingw excessd revenuem shalla ben distributedo tod them early: childhood education and care fund as soon as practicable.

b r e t º o t n = .216643.1AIC January 28, 2020 (9:56am) s k m e - 8 - e a n e d r e l u [ A d any remaining excess revenue shall be distributed to the early childhood education and care fund as soon as practicable.

(1) "annual average amount" means the total net receipts attributable to the tax imposed pursuant to e e 17 Section 7-31-4 NMSA 1978 and distributed pursuant to Section e e n d 18 7-1-6.20 NMSA 1978 in the immediately preceding five fiscal = = l ] 19 years, divided by five;

[and[and] ] a l r i 20 (2) "state reserves" means the general fund t e a t balances, including all authorized revenues and transfers to mh m 21 e d r e 22 the general fund and balances in the appropriation contingency cu e» r ct 23h fund, the general fund operating reserve, theSFCºSECºthe taxstate- stabilizationg e al ni bsupport 24reserve fund,»SEC»SFC the tax stabilization reserve h r i s and the tobacco settlement permanent fund;

and h , e h t u [g [(2)] (3) "year-to-date amount" means the .216643.1e -b 7l -e e , gh cumulative year-to-date net receipts attributable to the tax n d d i = = o h l ] b ,d imposed pursuant to Section 7-31-4 NMSA 1978 and distributed to i a º r e r = the general fund in the prior months of the current fiscal year."t SECTIONe 6.w d m a n o d m :

b r e t º o t n = .216643.1AIC January 28, 2020 (9:56am) s k m e - 9 - e a n e d r e l u [ A d year."»SFC SFCºSECTION 6.

Section 7-1-6.61 NMSA 1978 (being Laws (1st S.S.), Chapter 3, Section 3) is amended to read:

"7-1-6.61.

DISTRIBUTION--[TAX STABILIZATION RESERVE FROM THE] OIL AND GAS EMERGENCY SCHOOL TAX--EXCESS EXTRACTION TAXES SUSPENSE FUND.-- A.

A distribution pursuant to Section 7-1-6.20 NMSA shall be made to the [tax stabilization reserve] excess extraction taxes suspense fund in an amount as calculated pursuant to Subsection B of this section.

B.

If the year-to-date amount plus the current net receipts exceeds the annual average amount, the excess shall be distributed by the taxation and revenue department to the [tax stabilization reserve] excess extraction taxes suspense fund.

Each month the department of finance and administration shall make the calculation to determine the excess amount to be h distributed.

If there is not an excess amount, no distribution u » r t h shall be made [to the tax stabilization reserve.

Each month g e l i the department shall make the calculation to determine if an h r i s excess amount should be distributed].

h , e h t u g C.

As used in this section:

e b l e e , gh (1) "annual average amount" means the total n d d i = = o h l ] b ,d net receipts attributable to the tax imposed pursuant to i a º r e r = Section 7-31-4 NMSA 1978 and distributed pursuant to Section t e w d m a n o d m :

b r e t º o t n = .216643.1AIC January 28, 2020 (9:56am) s k m e - 10 - e a n e d r e l u [ A d 7-1-6.20 NMSA 1978 in the immediately preceding five fiscal years, divided by five;

and (2) "year-to-date amount" means the cumulative year-to-date net receipts attributable to the tax imposed pursuant to Section 7-31-4 NMSA 1978 and distributed to the general fund in the prior months of the current fiscal year."»SFC SECTION SFCº6»SFC SFCº7»SFC.

[Except for an annual appropriation to the instructional material fund and to the bureau of geology and mineral resources of the New Mexico institute of mining and technology, and except as provided in Subsection B of this section, all other] Money received by the state pursuant to the h provisions of the federal Mineral [Lands ] Leasing Act [30 USCA g o t hr 181, et seq.] shall be distributed to the public school fund, g e i k except as follows:

h r i s (1) an annual appropriation to the eh , t, e 17u g instructional material fund;

e eb nl de 18e h (2) an annual appropriation to the board of n d d i = = lo ]h 19 regents of the New Mexico institute of mining and technology l ] b ,d i a lº e r i 20= r for the bureau of geology and mineral resources;

t e w d m a tn o (3) the distribution made pursuant to md m 21: e d r e 22 Subsection B of this section;

andb c e rd cs 23º (4)o thet distributionn made= pursuant.216643.1AIC toJanuary Section28, 2020 (9:56am) s k m e - 11 - e a n be 24d 3r e l u [ A d Subsection B of this 2020section; act.

uand [(4) B.the distribution made pursuant to Section of this 2020 act.

[AllB. ] Money received by the state as its share .216643.1 - 8 - of a prepayment of royalties pursuant to 30 U.S.C.

[All ] Money received by the state as its share of a prepayment of royalties pursuant to 30 U.S.C.

and (2) the remainder shall be distributed to the common school permanent fund." SFCº SECTION 7.

APPROPRIATION.--Three hundred twenty million dollars ($320,000,000) is appropriated from the general h fund to the early childhood education and care fund for g o t hr expenditure in fiscal year 2021 and subsequent fiscal years to g e i k provide initial funding to the early childhood education and h r i s care fund.

Any unexpended or unencumbered balance remaining at h , t, e u g the end of a e e 17 fiscal year shall not revert to the general fund.e b l e e h fund.»SFC n d d i = = o h SECTION 8.

eEFFECTIVE DATE.--The effective date of the l ] b ,d i a º e nr di 18= SECTIONr 8.provisions of this act is July 1, 2020.

EFFECTIVEt DATE.--Thee effectivew dated ofm thea =n =o l- ]13 19- provisionsd ofm this: act is July 1, 2020.

ab le rd is 20º -o 9 - t en a= t.216643.1AIC mJanuary m28, 212020 e(9:56am) ds rk em 22 c e r- c12 23- e a n be 24d r e l u [ .216643.1A d