TRANSPORTATION TRUST FUND & PROGRAM FUND

HB0322

HOUSE BILL 322

57th legislature - STATE OF NEW MEXICO - second session, 2026

INTRODUCED BY

Cathrynn N. Brown

AN ACT

RELATING TO TRANSPORTATION; CREATING THE TRANSPORTATION TRUST
FUND AND THE TRANSPORTATION PROGRAM FUND; MAKING ANNUAL
DISTRIBUTIONS TO THE TRANSPORTATION PROGRAM FUND TO PROVIDE
MATCHING FUNDS FOR FEDERAL GRANTS; DISTRIBUTING A PORTION OF
GROSS RECEIPTS TAX REVENUE ATTRIBUTABLE TO THE SALE OF
ELECTRICITY TO THE TRANSPORTATION TRUST FUND; AMENDING
DISTRIBUTIONS OF THE MOTOR VEHICLE EXCISE TAX; AMENDING CERTAIN
SECTIONS OF LAWS 2021 THROUGH 2024 TO REQUIRE CERTAIN
UNEXPENDED GENERAL FUND CAPITAL OUTLAY APPROPRIATIONS TO REVERT
TO THE TRANSPORTATION TRUST FUND; MAKING AN APPROPRIATION.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1.
[
NEW MATERIAL
] TRANSPORTATION TRUST FUND.--

A. The "transportation trust fund" is created as a
nonreverting fund in the state treasury. The fund consists of
distributions, appropriations, gifts, grants and donations.
Income from investment of the fund shall be credited to the
fund. Money in the fund shall be expended only as provided in
this section.

B. The state investment officer, subject to the
approval of the state investment council and in consultation
with the state treasurer, shall invest money in the
transportation trust fund in accordance with the prudent
investor rule set forth in the Uniform Prudent Investor Act.

C. The state investment officer shall submit an
annual report on the investments made pursuant to this section
no later than October 1 of each year to the legislative finance
committee, the state investment council, the revenue
stabilization and tax policy committee and any other
appropriate interim committees.

D. On July 1, 2029 and each July 1 thereafter, a
distribution shall be made from the transportation trust fund
to the transportation program fund in an amount equal to five
percent of the average of the year-end market values of the
fund for the immediately preceding three calendar years. If,
on July 1 of a year, the trust fund has been in effect for less
than three calendar years, the distribution shall be in an
amount equal to five percent of the average of the year-end
market values of the trust fund for the immediately preceding
number of calendar years that the trust fund has been in
effect.

SECTION 2.
[
NEW MATERIAL
] TRANSPORTATION PROGRAM FUND.--The "transportation program fund" is created in the state
treasury. The fund consists of distributions, appropriations,
gifts, grants, donations and income from investment of the
fund. The department of transportation shall administer the
fund. Money in the fund is subject to appropriation by the
legislature to provide matching funds for federal grants for
transportation infrastructure projects authorized by the
legislature. Expenditures from the fund shall be by warrant of
the secretary of finance and administration pursuant to
vouchers signed by the secretary of transportation or the
secretary's authorized representative. Any unexpended balance
remaining at the end of a fiscal year shall revert to the
transportation trust fund.

SECTION 3.
A new section of the Tax Administration Act,
Section 7-1-6.74 NMSA 1978, is enacted to read:

"7-1-6.74. [
NEW MATERIAL
] DISTRIBUTION--TRANSPORTATION
TRUST FUND.--A distribution pursuant to Section 7-1-6.1 NMSA
1978 shall be made to the transportation trust fund in an
amount equal to the following percentages of the taxable gross
receipts attributable to the sale of electricity:

A. prior to July 1, 2032, one percent;

B. on or after July 1, 2032 and prior to July 1,
2037, one and one-fourth percent;

C. on or after July 1, 2037 and prior to July 1,
2042, one and one-half percent;

D. on or after July 1, 2042 and prior to July 1,
2047, one and three-fourths percent; and

E. on or after July 1, 2047, two percent."

SECTION 4.
Section 7-14-10 NMSA 1978 (being Laws 1988,
Chapter 73, Section 20, as amended) is amended to read:

"7-14-10. DISTRIBUTION OF PROCEEDS.--The receipts from
the tax and any associated interest and penalties shall be
deposited in the "motor vehicle suspense fund", hereby created
in the state treasury. As of the end of each month, the net
receipts attributable to the tax and associated penalties and
interest shall be distributed as follows:

A. prior to July 1, 2028:

(1) thirty percent to the general fund;

(2) thirty-five percent to the state road
fund;

(3) fifteen percent to the transportation
project fund; and

(4) twenty percent to the transportation trust
fund;

B. on and after July 1, 2028, except as provided in
Subsection C of this section:

(1) fifty percent to the state road fund;

(2) twenty percent to the transportation
project fund; and

(3) thirty percent to the transportation trust
fund; and

C. if gross receipts tax revenue in any twelve-
month period beginning July 1, 2031 and prior to July 1, 2042
is less than ninety percent of the gross receipts tax revenue
for the previous twelve-month period, as determined by the
department of finance and administration, then beginning July 1
following the determination:

[
A. fifty-nine and thirty-nine hundredths
]
(1)

fifty
percent to the general fund;

[
B. twenty-one and eighty-six hundredths
]
(2)

twenty
percent to the state road fund; [
and

C. eighteen and seventy-five hundredths
]
(3)

fifteen
percent to the transportation project fund;
and

(4) fifteen percent to the transportation
trust fund
."

SECTION 5.
Laws 2021, Chapter 138, Section 2 is amended
to read:

"
SECTION 2.
GENERAL FUND APPROPRIATIONS--LIMITATIONS--REVERSIONS.--

A. Except as otherwise specifically provided by
law, the unexpended balance of an appropriation made in this
act from the general fund shall revert
to the general fund
:

(1) no later than September 30 following:

(a) the end of fiscal year 2022 if the
project for which an appropriation was made has less than five
percent of the project's total appropriation amount subject to
a binding written agreement with a third party on that date;

(b) the end of fiscal year 2023 for a
project for which an appropriation was made to purchase
vehicles, including emergency vehicles and other vehicles that
require special equipment; heavy equipment; books; educational
technology; or other equipment or furniture that is not related
to a more inclusive construction or renovation project; or

(c) the end of fiscal year 2025 for a
project for which an appropriation was made related to an
inclusive construction or renovation project; or

(2) within six months of completion of the
project for any other project for which an appropriation was
made, but no later than the end of fiscal year 2025.

B. Except for appropriations to the capital program
fund, money from appropriations made in this act from the
general fund shall not be used to pay indirect project costs.

C. Except as provided in Subsection D of this
section, the balance of an appropriation made from the general
fund shall revert in the time frame set forth in Subsection A
of this section to the capital projects fund.

D. The balance of an appropriation made from the
general fund to the Indian affairs department or the aging and
long-term services department for a project located on lands of
an Indian nation, tribe or pueblo shall revert in the time
frame set forth in Subsection A of this section to the tribal
infrastructure project fund.

E. For the purposes of this section, "unexpended
balance" means the remainder of an appropriation after
reserving for unpaid costs and expenses subject to a binding
written agreement with a third party.

F. Money that is appropriated from the general fund
pursuant to this act shall not be subject to a binding written
agreement with a third party prior to the authorized state
agency's approval to enter into that agreement.

G. The unexpended balance of an appropriation made
in this act from the general fund that has not reverted on or
before the effective date of this 2026 act shall revert in the
time frame set forth in Subsection A of this section to the
transportation trust fund.
"

SECTION 6.
Laws 2022, Chapter 53, Section 2 is amended to
read:

"
SECTION 2.
GENERAL FUND APPROPRIATIONS--LIMITATIONS--REVERSIONS.--

A. Except as otherwise specifically provided by
law, the unexpended balance of an appropriation made in this
act from the general fund shall revert
to the general fund
:

(1) no later than September 30 following:

(a) the end of fiscal year 2023 if the
project for which an appropriation was made has less than five
percent of the project's total appropriation amount subject to
a binding written agreement with a third party on that date;

(b) the end of fiscal year 2024 for a
project for which an appropriation was made to purchase
vehicles, including emergency vehicles and other vehicles that
require special equipment; heavy equipment; books; educational
technology; or other equipment or furniture that is not related
to a more inclusive construction or renovation project; or

(c) the end of fiscal year 2026 for a
project for which an appropriation was made related to an
inclusive construction or renovation project; or

(2) within six months of completion of the
project for any other project for which an appropriation was
made, but no later than the end of fiscal year 2026.

B. Money that is appropriated from the general fund
pursuant to this act shall not be subject to a binding written
agreement with a third party prior to the authorized state
agency's approval to enter into that agreement.

C. For the purposes of this section, "unexpended
balance" means the remainder of an appropriation after
reserving for unpaid costs and expenses subject to a binding
written agreement with a third party.

D. The unexpended balance of an appropriation made
in this act from the general fund that has not reverted on or
before the effective date of this 2026 act shall revert in the
time frame set forth in Subsection A of this section to the
transportation trust fund.
"

SECTION 7.
Laws 2023, Chapter 199, Section 1 is amended
to read:

"
SECTION 1.
GENERAL FUND APPROPRIATIONS--LIMITATIONS--REVERSIONS.--

A. Except as otherwise specifically provided by
law, the unexpended balance of an appropriation made in this
act from the general fund shall revert
to the general fund
:

(1) no later than September 30 following:

(a) the end of fiscal year 2024 if the
project for which an appropriation was made has less than five
percent of the project's total appropriation amount subject to
a binding written agreement with a third party on that date;

(b) the end of fiscal year 2025 for a
project for which an appropriation was made to purchase
vehicles, including emergency vehicles and other vehicles that
require special equipment; heavy equipment; books; educational
technology; or other equipment or furniture that is not related
to a more inclusive construction or renovation project; or

(c) the end of fiscal year 2027 for a
project for which an appropriation was made related to an
inclusive construction or renovation project; or

(2) within six months of completion of the
project for any other project for which an appropriation was
made, but no later than the end of fiscal year 2027.

B. Except for appropriations to the capital program
fund, money from appropriations made in this act shall not be
used to pay indirect project costs.

C. Money that is appropriated from the general fund
pursuant to this act shall not be subject to a binding written
agreement with a third party prior to the authorized state
agency's approval to enter into that agreement.

D. For the purposes of this section, "unexpended
balance" means the remainder of an appropriation after
reserving for unpaid costs and expenses subject to a binding
written agreement with a third party.

E. The unexpended balance of an appropriation made
in this act from the general fund that has not reverted on or
before the effective date of this 2026 act shall revert in the
time frame set forth in Subsection A of this section to the
transportation trust fund.
"

SECTION 8.
Laws 2024, Chapter 66, Section 1 is amended to
read:

"
SECTION 1.
GENERAL FUND APPROPRIATIONS--LIMITATIONS--REVERSIONS.--

A. Except as otherwise specifically provided by
law, the unexpended balance of an appropriation made in this
act from the general fund shall revert
to the general fund
:

(1) no later than September 30 following:

(a) the end of fiscal year 2026 for a
project for which an appropriation was made to purchase
vehicles, including emergency vehicles and other vehicles that
require special equipment; heavy equipment; books; educational
technology; or other equipment or furniture that is not related
to a more inclusive construction or renovation project; or

(b) the end of fiscal year 2028 for a
project for which an appropriation was made related to an
inclusive construction or renovation project; or

(2) within six months of completion of the
project for any other project for which an appropriation was
made, but no later than the end of fiscal year 2028.

B. The agencies named in this act shall certify to
the department of finance and administration that the money
appropriated in this act is needed for the purposes specified
in the applicable section of this act. If an agency has not
certified the need for the appropriation for a particular
project by the end of fiscal year 2026, the authorization for
that project is void.

C. Money that is appropriated from the general fund
pursuant to this act shall not be subject to a binding written
agreement with a third party prior to the authorized state
agency's approval to enter into that agreement.

D. For the purposes of this section, "unexpended
balance" means the remainder of an appropriation after
reserving for unpaid costs and expenses subject to a binding
written agreement with a third party.

E. The unexpended balance of an appropriation made
in this act from the general fund that has not reverted on or
before the effective date of this 2026 act shall revert in the
time frame set forth in Subsection A of this section to the
transportation trust fund.
"

SECTION 9.
APPROPRIATION.--Four hundred million dollars
($400,000,000) is appropriated from the general fund to the
transportation trust fund for expenditure in fiscal year 2027
and subsequent fiscal years to provide initial funding to the
fund. Any unexpended balance remaining at the end of a fiscal
year shall not revert to the general fund.

SECTION 10.
EFFECTIVE DATE.--The effective date of the

provisions of this act is July 1, 2026.

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