SB 98 — ECONOMIC DEVELOPMENT INCENTIVE REPORTS

SENATE BILL 98 55TH LEGISLATURE -STATEOFNEWMEXICO-- STATEOFNEWMEXICO- FIRST SESSION, 2021 INTRODUCED BY Bill Tallman 6This 8document 10may ANincorporate ACTamendments RELATINGproposed TOby ECONOMICa DEVELOPMENTcommittee, INCENTIVES;but not yet adopted, as well as amendments that have been adopted during the current legislative session.

REQUIRINGThe RECIPIENTSdocument OFis PUBLICa SUPPORTtool FROMto THEshow STATEamendments PURSUANTin TOcontext THEand LOCALcannot ECONOMICbe DEVELOPMENTused ACTfor TOthe REPORTpurpose JOBof CREATIONadding ANDamendments CAPITALto INVESTMENTlegislation. INFORMATION;

REQUIRINGh THEAN TAXATIONACT ANDg REVENUEo DEPARTMENTRELATING TO COMPILEECONOMIC ANDDEVELOPMENT PRESENTINCENTIVES; A TAX EXPENDITURE BUDGET AND ANALYSES OF CERTAIN TAX EXPENDITURES TO THE GOVERNOR e t 17 AND LEGISLATIVE COMMITTEES;

MAKINGREQUIRING ANt APPROPRIATION.hr g e i k RECIPIENTS OF PUBLIC SUPPORT FROM THE STATE PURSUANT TO THE h r i s LOCAL ECONOMIC DEVELOPMENT ACT TO REPORT JOB CREATION AND h , t, CAPITAL INVESTMENT INFORMATION;

wREQUIRING THE TAXATION AND e u g e b l e e h REVENUE DEPARTMENT TO COMPILE AND PRESENT A TAX EXPENDITURE n d 18d i = = 19o ah lBUDGET BEAND ITANALYSES ENACTEDOF BYCERTAIN THETAX LEGISLATUREEXPENDITURES OFTO THE STATEGOVERNOR OFl NEW] MEXICO:b ,d i a º e AND LEGISLATIVE COMMITTEES SFCº ;

iMAKING aAN eAPPROPRIATION»SFC r. 20 SECTION 1.

Ar newi section= ofr thet Locale Economicw ad t m ma 21n Developmento Actd ism enacted: to read:

b e d rs eº 22o "[NEWt MATERIAL]n REPORTING= REQUIREMENTS.--.218494.1AIC cMarch e16, 2021 (4:17pm) s k 23m A.e e a n e d r e l u [ A d BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

ASECTION qualifying1. entity that receives public support e a n b 24 provided by the state to a local or regional government shall, u [ prior to April 1 of each year for five years following .218494.1 receiving the public support, report to the department the number of new full-time jobs created by the qualifying entity in the previous calendar year, the job title for each person employed in a new full-time job, the total annual wages and salaries for those new full-time jobs and any capital investments made by the qualifying entity in the previous calendar year.

A new section of the Local Economic Development Act is enacted to read:

"[NEW MATERIAL ] REPORTING REQUIREMENTS.-- A.

A qualifying entity that receives public support provided by the state to a local or regional government shall, prior to April 1 of each year for five years following receiving the public support, report to the department the number of new full-time jobs created by the qualifying entity in the previous calendar year, the job title for each person employed in a new full-time job, the total annual wages and salaries for those new full-time jobs and any capital investments made by the qualifying entity in the previous calendar year.

Prior to August 1 of each year, the department shall compile the annual reports received from the qualifying entities and submit the compilation to the legislative finance h g committee and the department of finance and administration.

o t hr C.

As used in this section, "new full-time job" g e i k means a job:

h r i s h (1) that is primarily performed in New Mexico;

, t, e u g (2) that is held by an employee who is hired e b l e e h to work an average of at least thirty-two hours per week for at en td 17d i = = o h least forty-eight weeks per year;

and w l n] db 18,d i a º e r i = r (3) that the qualifying entity attributes to =t =e 19w d m a ln o the public support provided by the state." id am e: r 20 SECTION 2.

Ab newe sectiond ofs theº Taxo Administrationt Actn is= a.218494.1AIC tMarch m16, 2021 (4:17pm) s k m 21e enacted- to2 read:- e a n e d r e l u [ A d SECTION 2.

dA rnew esection 22of "[NEWthe MATERIAL]Tax TAXAdministration EXPENDITUREAct BUDGET--ASSESSMENTis ANDenacted cto eread: s k 23 ANALYSIS OF CERTAIN TAX EXPENDITURES.-- e a n b 24 A.

No"[NEW laterMATERIAL] thanTAX OctoberEXPENDITURE 15BUDGET--ASSESSMENT ofAND eachANALYSIS year,OF theCERTAIN uTAX [EXPENDITURES.-- secretaryA. shall compile and present a tax expenditure budget to .218494.1 - 2 - the governor, the revenue stabilization and tax policy committee and the legislative finance committee and post the tax expenditure budget report to the department's website.

No later than October 15 of each year, the secretary shall compile and present a tax expenditure budget to the governor, the revenue stabilization and tax policy committee and the legislative finance committee and post the tax expenditure budget report to the department's website.

h (3) a brief description of the tax deviation;

g o t hr (4) the intended purpose of the tax deviation, g e i k if specified in the law providing for the tax deviation or as h r i s otherwise determined by the department;

h , t, (5) if the tax deviation is a tax expenditure, e u g e b l e e h an estimate of the approximate amount of foregone revenue by en td 17d i = = o h fiscal year for:

w l n] db 18,d i a º e (a) the three fiscal years preceding the =r i = 19r t e w d m a ln o current fiscal year, including the general fund, other state id am e: r 20 funds and local government revenues;

andb ae td ms mº 21o (b)t then current= and.218494.1AIC subsequentMarch fiscal16, d2021 r(4:17pm) es 22k year,m ife feasible,- and3 a- briefe descriptiona ofn thee methodologyd cr e sl ku 23[ andA assumptionsd appliedfunds toand thelocal forecastedgovernment estimate;revenues;

eand a(b) n b 24 (6) the numbercurrent ofand taxpayerssubsequent that claimed a tax u [ expenditure for each fiscal yearyear, reported,if unlessfeasible, reportingand of .218494.1 - 3 - such data is in a formbrief thatdescription canof bethe associatedmethodology withand orassumptions otherwiseapplied identify,to directlythe orforecasted indirectly,estimate; a particular taxpayer;

(6) the number of taxpayers that claimed a tax expenditure for each fiscal year reported, unless reporting of such data is in a form that can be associated with or otherwise identify, directly or indirectly, a particular taxpayer;

(1) a description or reference citation of any tax deviation evaluation or compilation of information h completed by an executive or legislative agency since the last g o t hr tax expenditure budget report by the department;

and g e i k (2) a measure of the tax deviation's effect on h r i s the administration of the tax system.

h , t, D.

If a tax expenditure is identified by the e u g e b l e e h department as having a purpose of economic development and an en td 17d i = = o h estimated cost of more than ten million dollars ($10,000,000) w l n] db 18,d i a º e per fiscal year, the department shall, at least every three =r i = 19r t e w d m a ln o years for each identified tax expenditure:

id a e r 20 (1) perform an objective assessment of the a t m m: 21 effectiveness of the tax expenditure;

db r e 22d (2)s includeº witho thet assessmentn an= economic.218494.1AIC cMarch e16, 2021 (4:17pm) s k 23m analysise of- the4 tax- expenditure, with the support and e a n be 24d assistancer ofe thel staffu of[ theA legislatived finance(1) committeeperform uan [objective andassessment of the economiceffectiveness developmentof department;the tax expenditure;

.218494.1(2) -include 4with -the (3)assessment noan latereconomic thananalysis October 15 of everythe year,tax compileexpenditure, andwith present the assessmentsupport and economicassistance analysisof to the governor,staff of the revenuelegislative stabilizationfinance and tax policy committee and the legislativeeconomic financedevelopment committee;department;

(3) no later than October 15 of every year, compile and present the assessment and economic analysis to the governor, the revenue stabilization and tax policy committee and the legislative finance committee;

and 2) recommendations as to how sufficient data may be collected and statutory changes necessary to perform or improve the economic h analysis;

and u » r (4) post the information compiled pursuant to t h g e l i Paragraph (3) of this subsection to the department's website.

h r i s E.