STUDY TAX, RENTALS, INFRASTRUCTURE & FUNDING

HM062

HOUSE MEMORIAL 62

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

INTRODUCED BY

Nathan P. Small

A MEMORIAL

REQUESTING THE TAXATION AND REVENUE DEPARTMENT TO CONVENE A
TASK FORCE TO CONDUCT A COMPREHENSIVE STUDY OF TAX
CENTRALIZATION, UNIFORM SHORT-TERM RENTAL CLASSIFICATION AND
THE BROADER ECONOMIC IMPACTS OF SHORT-TERM RENTALS ON TOURISM,
WORKFORCE DEVELOPMENT, RURAL INFRASTRUCTURE AND LOCAL SERVICE
FUNDING.

WHEREAS, short-term rentals have become an integral
component of New Mexico's hospitality and tourism ecosystem,
generating more than one billion dollars ($1,000,000,000) in
statewide economic impact and supporting thousands of jobs in
communities throughout the state, including rural and high-
tourism regions such as Taos, Santa Fe and Bernalillo counties;
and

WHEREAS, short-term rentals support diversified lodging
that attracts visitors to New Mexico's cultural, historic and
outdoor assets, directly benefiting restaurants, retail
establishments, guides, outfitters and other small local
businesses; and

WHEREAS, economic activity involving short-term rentals
has a measurable employment multiplier, expanding work
opportunities for cleaners, maintenance professionals,
freelance contractors, virtual property managers and service
workers who contribute to workforce development and local
business vitality; and

WHEREAS, short-term rentals also provide supplemental
income that enables New Mexico families to sustain home
ownership and invest in their communities, thereby reinforcing
the entrepreneurial spirit prevalent across the state; and

WHEREAS, inconsistent property tax classification
practices by county assessors, including disparate
reclassifications of short-term rental properties from
residential to nonresidential status, have introduced
regulatory uncertainty and the potential for significant tax
increases that could unintentionally destabilize tourism-
related supplemental income streams; and

WHEREAS, rural municipalities often lack a dedicated
administrative capacity to uniformly collect occupancy taxes
and gross receipts taxes, resulting in revenue leakage that
could otherwise be directed toward essential local services,
public safety, road maintenance, water and wastewater
infrastructure and broadband expansion in rural New Mexico; and

WHEREAS, centralized tax collection mechanisms and uniform
classification frameworks, developed with robust stakeholder
participation, may provide a path to ensuring that rural cities
and counties receive their fair share of revenue to fund
infrastructure and core services equitably; and

WHEREAS, the work group convened by the taxation and
revenue department, the tourism department and the economic
development department pursuant to House Memorial 52 passed
during the 2025 regular legislative session provided valuable
insights into the economic impacts, tax variability and
classification challenges statewide, underscoring the value of
a comprehensive statewide study prior to codifying permanent
tax or classification changes;

NOW, THEREFORE, BE IT RESOLVED BY THE HOUSE OF
REPRESENTATIVES OF THE STATE OF NEW MEXICO that the taxation
and revenue department, in coordination with the tourism
department, the New Mexico municipal league and the New Mexico
association of counties, be requested to convene a task force
to conduct a comprehensive study of:

A. the feasibility and fiscal impacts of
centralized collection and remittance of local lodgers' tax and
gross receipts tax related to short-term rentals, including
potential implications for rural and under-resourced
communities;

B. a uniform framework for short-term rental
property classification that balances residential property
protections with appropriate contributions and provides
consistency across all of the counties in New Mexico;

C. the broader economic contributions of short-term
rentals to workforce development, small business opportunity
creation and the entrepreneurship ecosystem in New Mexico; and

D. the potential for centralized tax revenue
structures to enhance funding for rural infrastructure, public
safety, affordable housing initiatives and essential local
government services; and

BE IT FURTHER RESOLVED that the task force include
designated representatives from the taxation and revenue
department, the tourism department, the New Mexico municipal
league, the New Mexico association of counties, the New Mexico
short-term rental association, a short-term rental platform,
the New Mexico association of realtors, rural municipal
officials, county treasurers and workforce development and
small business stakeholders; and

BE IT FURTHER RESOLVED that all county assessors be
requested to pause any new or ongoing property tax
reclassifications of short-term rental properties until the
findings and policy recommendations of this study have been
presented to the appropriate interim legislative committees;
and

BE IT FURTHER RESOLVED that the comprehensive study
include recommendations on alignments with requirements of the
Lodgers' Tax Act, potential statutory changes to support
centralized tax collection and strategies to direct economic
gains toward public infrastructure and local service funding in
under-resourced communities; and

BE IT FURTHER RESOLVED that the task force be requested to
submit its findings and recommendations to the appropriate
interim legislative committees by October 1, 2026; and

BE IT FURTHER RESOLVED that copies of this memorial be
transmitted to the governor, the secretary of taxation and
revenue, the secretary of tourism, the president of the New
Mexico municipal league and the president of the New Mexico
association of counties.

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