USE OF EMERGENCY FUNDS & DISASTERS

HAFC/HB 180/a
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AN ACT
RELATING TO EMERGENCY FUNDING; CLARIFYING THE USE OF CERTAIN
FUNDS; AUTHORIZING EXPENDITURES FOR NON-NATURAL DISASTERS
FROM THE APPROPRIATION CONTINGENCY FUND; RENAMING THE
"FEDERAL REIMBURSEMENT REVOLVING FUND" AS THE "EXECUTIVE
ORDER FOR DISASTERS FUND" AND AUTHORIZING EXPENDITURES FROM
THAT FUND FOR A NATURAL DISASTER OR A STATE OF MARTIAL LAW;
CONFORMING SECTION 6-4-2.2 NMSA 1978 (BEING LAWS 1987,
CHAPTER 264, SECTION 3 AND LAWS 1987, CHAPTER 347, SECTION 3,
AS AMENDED); MAKING CERTAIN TRANSFERS; CREATING A DISASTER
FUNDING TASK FORCE; MAKING APPROPRIATIONS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. Section 6-4-2.1 NMSA 1978 (being Laws 1987,
Chapter 184, Section 1) is amended to read:
"6-4-2.1. GENERAL FUND OPERATING RESERVE CREATED--
AUTHORIZING EXPENDITURES.--
A. The "general fund operating reserve" is created
in the general fund.
B. The general fund operating reserve may be
expended only upon specific authorization by the legislature
in an amount authorized by the legislature for a specific
fiscal year in the event general fund revenues and balances,
including all other transfers to the general fund authorized
by law, are insufficient to meet the level of appropriations
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authorized."
SECTION 2. Section 6-4-2.2 NMSA 1978 (being Laws 1987,
Chapter 264, Section 3 and Laws 1987, Chapter 347, Section 3,
as amended) is amended to read:
"6-4-2.2. GENERAL FUND TAX STABILIZATION RESERVE.--
A. The "tax stabilization reserve" is created
within the state treasury as a reserve fund of the state.
B. The tax stabilization reserve consists of money
directed or appropriated to it by law and all income from
investment of the reserve. The state investment officer,
subject to the approval of the state investment council,
shall invest money in the reserve:
(1) in accordance with the prudent investor
rule set forth in the Uniform Prudent Investor Act; and
(2) in consultation with the state
treasurer.
C. The state investment officer shall report
quarterly to the legislative finance committee and the state
investment council on the investments made pursuant to this
section. Annually, a report shall be submitted no later than
October 1 each year to the legislative finance committee, the
revenue stabilization and tax policy committee and any other
appropriate interim committees.
D. Except as otherwise provided in Subsections E
and F of this section and Laws 2024, Chapter 61, Section 4,
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any balance of the tax stabilization reserve may be:
(1) appropriated only by a two-thirds'
majority vote of both houses of the legislature following
receipt by the legislature of a declaration of the governor
that such an appropriation is necessary for the public peace,
health and safety; or
(2) expended by the governor only:
(a) pursuant to an appropriation made
by a two-thirds' majority vote of both houses of the
legislature specifying the amount of the appropriation and
the purpose of the expenditure; and
(b) if the governor declares that the
expenditure is necessary for the public peace, health and
safety.
E. If the balance in the general fund operating
reserve is less than one percent of aggregate general fund
appropriations for that fiscal year, as determined by the
department of finance and administration, then an amount
equal to the smaller of either one percent of aggregate
general fund appropriations for that fiscal year or the
amount necessary to bring the balance of the general fund
operating reserve to one percent of aggregate general fund
appropriations for that fiscal year shall be transferred from
the tax stabilization reserve to the general fund operating
reserve. If a transfer pursuant to this subsection is made
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for a fiscal year, no further transfers pursuant to this
subsection shall be made for that fiscal year.
F. If general fund revenues, including all
transfers to the general fund authorized by law, are
projected by the governor to be insufficient either to meet
the level of appropriations authorized by law from the
general fund for the current fiscal year or to meet the level
of appropriations recommended in the budget and
appropriations bill submitted in accordance with Section
6-3-21 NMSA 1978 for the next fiscal year, the balance in the
tax stabilization reserve may be appropriated by the
legislature up to the amount of the projected insufficiency
for either or both fiscal years."
SECTION 3. Section 6-4-2.3 NMSA 1978 (being Laws 1991,
Chapter 10, Section 7, as amended) is amended to read:
"6-4-2.3. APPROPRIATION CONTINGENCY FUND.--
A. The "appropriation contingency fund" is created
in the state treasury and consists of appropriations, grants,
distributions and transfers to the fund. Money in the fund
may be expended pursuant to Subsection B or D of this section
or Section 20-1-6 NMSA 1978 or upon specific authorization by
the legislature in an amount authorized by the legislature
for a specific fiscal year. Money in the fund shall be
disbursed on warrants signed by the secretary of finance and
administration pursuant to vouchers signed by the governor or
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the governor's authorized representative.
B. Upon a declaration of a disaster that is not a
natural disaster by executive order, the governor may
authorize a state agency to provide resources and services
necessary to avoid or minimize physical or economic harm,
including the temporary provision of lodging, shelter, health
care, food or transportation for persons affected by the
disaster. Subject to the availability of funds, there is
appropriated from the fund so much as the governor may
designate to provide those resources and services.
C. On or before October 1 of each year, for each
declaration of a disaster that is not a natural disaster by
executive order for which an appropriation is made pursuant
to Subsection B of this section, the secretary of finance and
administration and the executive officer of the agency or
other entity receiving the funds shall submit a report to the
legislative finance committee and any appropriate legislative
interim committee that includes the following:
(1) the purpose and number of the executive
order and the statutory authority for which the appropriation
is made;
(2) the county in which the executive order
applies;
(3) the balance of funds appropriated for
the purpose of the executive order;
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(4) a projected time line for expending the
appropriation;
(5) the name and address of each entity for
which the state has contracted to provide resources and
services; and
(6) an update on the state of response or
recovery.
D. Money in the fund may be expended to provide
the resources and services authorized pursuant to Section
6-4-2.9 NMSA 1978; provided that the executive order for
disasters fund is exhausted.
E. As used in this section, "disaster that is not
a natural disaster" means an event that threatens the public
peace, health and safety or the lives or property of the
people of the state but does not include a disaster brought
on by natural forces, such as drought, fire, flood, severe
weather or earthquake."
SECTION 4. Section 6-4-2.7 NMSA 1978 (being Laws 2025,
Chapter 157, Section 2) is amended to read:
"6-4-2.7. NATURAL DISASTER REVOLVING FUND.--
A. The "natural disaster revolving fund" is
created as a nonreverting fund in the state treasury. The
purpose of the fund is to provide loans to political
subdivisions of the state and electric cooperatives that have
been approved for funding from the federal emergency
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management agency for a federally declared natural disaster.
The fund consists of distributions, transfers,
appropriations, gifts, grants, donations, income from
investment of the fund and income earned on loans made from
the fund. Money in the fund shall be invested by the state
treasurer.
B. Money in the natural disaster revolving fund is
appropriated to the department of finance and administration
for:
(1) the purposes of the natural disaster
loan program pursuant to Section 6-4-2.6 NMSA 1978;
(2) resources and services authorized by
Section 6-4-2.9 NMSA 1978; provided that the executive order
for disasters fund and the appropriation contingency fund are
exhausted; and
(3) administration of the natural disaster
loan program and enforcement of loan contracts; provided that
no more than four hundred thousand dollars ($400,000)
annually shall be used for these purposes.
C. Money in the natural disaster revolving fund is
appropriated to the homeland security and emergency
management department for the compliance management of
programs administered by the federal emergency management
agency that serve as the basis for a natural disaster loan;
provided that no more than one hundred fifty thousand dollars
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($150,000) annually shall be used for these purposes.
D. The department of finance and administration
shall administer the fund, and expenditures from the fund
shall be by warrant of the secretary of finance and
administration pursuant to vouchers signed by the secretary
or the secretary's authorized representative or vouchers
signed by the secretary of homeland security and emergency
management or that secretary's authorized representative."
SECTION 5. Section 6-4-2.9 NMSA 1978 (being Laws 2025,
Chapter 157, Section 6) is amended to read:
"6-4-2.9. EXECUTIVE ORDER FOR DISASTERS FUND.--
A. The "executive order for disasters fund" is
created in the state treasury. Money in the fund consists of
reimbursed claims from the federal government for emergency
expenditures, unless otherwise obligated under an agreement
with the federal government, appropriations, distributions,
transfers, income from investment of the fund and money
otherwise deposited in the fund. Money in the fund may be
expended pursuant to Subsection B of this section or Section
20-1-6 NMSA 1978 or upon specific authorization by the
legislature in an amount authorized by the legislature for a
specific fiscal year. Money in the fund shall be disbursed
on warrants signed by the secretary of finance and
administration pursuant to vouchers signed by the governor or
the governor's authorized representative.
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B. Upon a declaration of a natural disaster or
state of martial law by executive order, the governor may
authorize a state agency to provide resources and services
necessary to avoid or minimize physical or economic harm,
including the temporary provision of lodging, shelter, health
care, food or transportation for persons affected by a
natural disaster. Subject to the availability of funds,
there is appropriated from the fund so much as the governor
may designate to provide those resources and services.
C. On or before October 1 of each year, for each
declaration of a natural disaster or state of martial law by
executive order for which an appropriation is made pursuant
to Subsection B of this section, the secretary of finance and
administration and the executive officer of the agency or
other entity receiving the funds shall submit a report to the
legislative finance committee and any appropriate legislative
interim committee that includes the following:
(1) the purpose and number of the executive
order and the statutory authority for which the appropriation
is made;
(2) the county in which the executive order
applies;
(3) the balance of funds appropriated for
the purpose of the executive order;
(4) a projected time line for expending the
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appropriation;
(5) the name and address of each entity for
which the state has contracted to provide resources and
services; and
(6) an update on the state of response or
recovery.
D. As used in this section, "natural disaster"
means a disaster brought on by natural forces, such as a
drought, a fire, a flood, severe weather or an earthquake,
that threatens the public peace, health and safety or the
lives or property of the people of the state."
SECTION 6. Section 6-4-4 NMSA 1978 (being Laws 1987,
Chapter 347, Section 4, as amended) is amended to read:
"6-4-4. TRANSFERS FROM THE GENERAL FUND.-- If the
revenues of the general fund exceed the total of
appropriations from the general fund, the excess revenue
shall be transferred to the general fund operating reserve;
provided that if the sum of the excess revenue plus the
balance in the general fund operating reserve prior to the
transfer is greater than eight percent of the aggregate
recurring appropriations from the general fund for the
previous fiscal year, then an amount equal to the smaller of
either the amount of the excess revenue or the difference
between the sum and eight percent of the aggregate recurring
appropriations from the general fund for the previous fiscal
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year shall be transferred to the government results and
opportunity expendable trust."
SECTION 7. Section 20-1-6 NMSA 1978 (being Laws 1987,
Chapter 318, Section 6, as amended) is amended to read:
"20-1-6. EXPENSES FOR TROOPS CALLED INTO SERVICE OF THE
STATE.--
A. All compensation of personnel and all the
necessary expenses incurred in quartering, housing, caring
for, subsisting, protecting, equipping, warning for duty and
transporting such officers and members and their equipment,
including the purchase or lease of any articles of material,
equipment or supplies reasonably required, designed or needed
to accomplish the purpose or results specified in the
governor's call for such troops into service of the state,
shall be paid by the state from the executive order for
disasters fund.
B. On or before the twentieth legislative day of
the next legislative session following the expenditures of
the sums provided for in this section, the governor shall
file a written report with the presiding officer of each
house of the legislature setting forth the purpose and the
amounts of money expended as provided in this section.
C. The provisions of this section may be used for
the operation of the national guard or the state defense
force when on militia duty."
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SECTION 8. TEMPORARY PROVISION--DISASTER FUNDING TASK
FORCE.--The legislative finance committee shall convene a
disaster funding task force composed of the director of the
legislative finance committee, the state director of homeland
security and emergency management, the adjutant general of
the New Mexico national guard and the secretary of finance
and administration, or those individuals' designees. The
task force shall review the provisions of this act and make
recommendations for proposed legislation for the first
session of the fifty-eighth legislature. Members of the task
force shall report the recommendations to the legislative
finance committee by November 1, 2026. The report shall
identify issues related to fiscal controls, accountability,
transparency, contingency plans and disaster response
flexibility for the executive.
SECTION 9. TRANSFERS.--
A. The balance of the federal reimbursement
revolving fund is transferred to the executive order for
disasters fund.
B. The balance of the adjutant general emergency
public defense certificates fund is transferred to the
appropriation contingency fund.
SECTION 10. TRANSFERS TO NATURAL DISASTER REVOLVING
FUND.--Within thirty days after August 1 of 2026 and 2027,
the secretary of finance and administration shall calculate
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the unexpended balance of the natural disaster revolving fund
and, subject to availability of funds, transfer from the
appropriation contingency fund to the natural disaster
revolving fund an amount not greater than fifty million
dollars ($50,000,000) less the balance of the natural
disaster revolving fund. If the unexpended balance of the
natural disaster revolving fund is equal to or greater than
fifty million dollars ($50,000,000), no transfer shall be
made.
SECTION 11. REPEAL.--Section 6-4-2.8 NMSA 1978 (being
Laws 2025, Chapter 157, Section 3) is repealed.
SECTION 12. DELAYED REPEAL.--Sections 12-11-23 through
12-11-25 NMSA 1978 (being Laws 1955, Chapter 185, Sections 1
through 3, as amended) are repealed effective February 15,
2027.
SECTION 13. EFFECTIVE DATE--DELAYED EFFECTIVE DATE.--
A. The effective date of the provisions of
Sections 10 and 11 of this act is July 1, 2026.
B. The effective date of the provisions of
Sections 1 through 7 and 9 of this act is February 15, 2027.