TITLE 19 NATURAL
RESOURCES AND WILDLIFE
CHAPTER 25 ADMINISTRATION
AND USE OF WATER-GENERAL PROVISIONS
PART 10 REVIEW
AND ELIGIBILITY OF PROPOSED WATER PROJECTS
19.25.10.1 ISSUING
AGENCY: New Mexico Water Trust Board.
[19.25.10.1 NMAC - Rp,
19.25.10.1 NMAC, 7/31/2008]
19.25.10.2 SCOPE: All
persons applying for financial assistance under the water project fund from the
New Mexico finance authority, NMSA 1978, 72-4A-5 and NMSA 1978, 72-4A-9.
[19.25.10.2 NMAC -
Rp, 19.25.10.2 NMAC, 7/31/2008]
19.25.10.3 STATUTORY
AUTHORITY: Sections 72-4A-5 and 72-4A-9, NMSA 1978.
[19.25.10.3 NMAC -
Rp, 19.25.10.3 NMAC, 7/31/2008]
19.25.10.4 DURATION:
Permanent.
[19.25.10.4 NMAC -
Rp, 19.25.10.4 NMAC, 7/31/2008]
19.25.10.5 EFFECTIVE DATE: July
31, 2008, unless a later date is cited at the end of a section.
[19.25.10.5 NMAC -
Rp, 19.25.10.5 NMAC, 7/31/2008]
19.25.10.6 OBJECTIVES:
A. Section
72-4A-5, NMSA 1978 provides that the New Mexico water trust board is required
to adopt rules governing terms and conditions of grants and loans recommended
by the board for appropriation by the state legislature from the water project
fund giving priority to projects that have urgent needs, that have been
identified for implementation of a completed regional water plan that is
accepted by the interstate stream commission and that have matching
contributions from federal or local funding sources; and authorizes qualifying
water projects to the authority that are for: (1) storage, conveyance or
delivery of water to end users; (2) implementation of federal Endangered
Species Act of 1973; (3) restoration and management of watersheds; (4) flood
prevention; and (5) conservation, recycling, treatment or reuse of water as
provided by law. Additionally, the board
shall create a drought strike team to coordinate responses to emergency water
shortages caused by drought conditions. Section 72-4A-9, NMSA 1978, creates the
“water project fund” within the New Mexico finance authority.
B. Section 72-4A-5,
NMSA 1978, provides that the board shall give priority to qualifying water
projects that (1) have been identified by the board as being urgent to address
public health and safety issues; (2) have matching contributions from federal
or local funding sources available and (3) have obtained all requisite state
and federal permits and authorizations necessary to initiate the qualifying
water project. The purpose of these rules is to set forth the intent of the
board and to outline, in general terms, the criteria and procedures to be used
in evaluating and funding qualifying water projects.
C. Section 72-4A-5,
NMSA 1978, provides that the board shall evaluate projects, including their
environmental impacts, and recommend projects to the interstate stream
commission pursuant to the provisions of Section 72-14-45, NMSA 1978.
D. Section 72-4A-6, NMSA 1978, provides that the authority
shall provide support for the water trust board, develop application procedures
and forms for qualifying entities to apply for grants and loans from the water
project fund; and make loans or grants to qualifying entities for qualifying
water projects authorized by the state legislature, provided that the service
area for the project is wholly within the boundaries of the state or the
project is an interstate project that directly benefits New Mexico.
E. Section 72-4A-9,
NMSA 1978, provides that the authority may adopt separate procedures and rules
for administration of the water project fund and recover from the water project
fund costs of administering the water project fund and originating grants and loans.
[19.25.10.6 NMAC -
Rp, 19.25.10.6 NMAC, 7/31/2008; A, 4/22/2025]
19.25.10.7 DEFINITIONS:
A. “Act” means the Water Project Finance
Act, Sections 72-4A-1 through 72-4A-10, NMSA 1978, as the same may be amended
and supplemented.
B. “Agreement” means the document or
documents signed by the board and a qualifying entity which specify the terms and
conditions of obtaining financial assistance from the water project fund.
C. “Applicant” means a qualifying entity
which has filed a water project proposal with the authority for initial review
and referral to the board’s project review committee.
D. “Authority” means the New Mexico
finance authority.
E. “Authorized representative” means one
or more individuals duly authorized to act on behalf of the qualifying entity
in connection with its financial application, water project proposal or
agreement.
F. “Board” means the New Mexico water
trust board created by the act.
G. “Bylaws” means the bylaws of the board
adopted on September 25, 2001, and amended on June 27, 2007, and as may be
further amended and supplemented.
H. “Financial application” means a written
document filed with the authority by an applicant for the purpose of evaluating
the applicant’s qualifications for types of financial assistance which may be
provided by the board.
I. “Financial assistance” means loans,
grants and any other type of assistance authorized by the act, or a combination
thereof, provided from the water project fund to a qualified entity for the
financing of a qualifying water project.
J. “Policy committee”
means a standing committee, appointed by the chairman of the board from the
members of the board pursuant to the bylaws to review policies and policy
related matters and make recommendations to the full board.
K. “Political subdivision” means a
municipality, county, land grant-merced controlled
and governed pursuant to Section 49-1-1 through 49-1-18 or 49-4-1 through
49-4-21 NMSA 1978, regional or local public water utility authority created by
statute, irrigation district, conservancy district, special district, acequia
or soil and water conservation district, water and sanitation district, or an
association organized and existing pursuant to the Sanitary Projects Act,
Chapter 3, Article 29 NMSA 1978.
L. “Project review
committee” means a standing committee, appointed by the chairman of the
board from the members of the board pursuant to the bylaws to review water
projects to be recommended for funding from the water project fund.
M. “Qualifying entity” means a state
agency, a political subdivision of the state, an intercommunity water or
natural gas supply association or corporation organized under Chapter 3,
Article 28 NMSA 1978, a recognized Indian nation, tribe or pueblo, the
boundaries of which are located wholly or partially in New Mexico or an
association of such entities created pursuant to the Joint Powers Agreement
Act, Chapter 11, Article 1 NMSA 1978 or other authorizing legislation for the
exercise of their common powers.
N. “Qualifying water project” means a
project recommended by the board for funding by the legislature which includes
a water project serving an area wholly within the boundaries of the state for
(1) storage, conveyance or delivery of water to end users; (2) implementation
of federal Endangered Species Act of 1973 collaborative programs; (3)
wastewater conveyance and treatment; (4) restoration and management of
watersheds; (5) flood prevention; or (6) conservation, recycling, treatment or
reuse of water as provided by law and which has been approved by the state
legislature pursuant to Subsection B of Section 72-4A-9, NMSA 1978.
O. “State” means
the state of New Mexico.
P. “State agency”
means any agency or institution of the state.
Q. “Water project
account” means a fund designated by a qualifying entity exclusively for
receipt of financial assistance.
R. “Water project fund”
means the fund of that name created in the authority by Section 72-4A-9, NMSA
1978.
S. “Water project
proposal” means a written proposal submitted by a qualifying entity for
review by the project review committee.
T. “Water trust fund”
means the fund of that name created in the state treasury by Section 72-4A-8,
NMSA 1978.
[19.25.10.7 NMAC -
Rp, 19.25.10.7 NMAC, 7/31/2008; A, 12/30/2013; A, 4/22/2025]
19.25.10.8 ELIGIBILITY:
PRIORITIZATION OF WATER PROJECTS: The board will develop and
consider a variety of factors in reviewing and evaluating water project
proposals to determine which water projects to recommend as qualifying water
projects for appropriation by the state legislature. The board shall give
priority to projects that have urgent needs and that have matching
contributions from federal or local sources as provided for in Section 72-4A-5
NMSA 1978. Pursuant to Section 72-4A-5.1
NMSA 1978, the board, in conformance with the state water plan and pursuant to
the provisions of the Water Project Finance Act, shall prioritize the planning
and financing of water projects required to implement the plan. The board shall
identify opportunities to leverage federal and other funding. The board shall
establish policies for prioritization of water projects.
[19.25.10.8 NMAC -
Rp, 19.25.10.8 NMAC, 7/31/2008; A, 12/30/2013; A, 4/30/2015; A, 4/22/2025]
19.25.10.9 WATER
PROJECT PROPOSAL, PROCEDURES AND APPROVAL PROCESS:
A. The authority will administer an outreach program to notify qualifying
entities that water project proposals are being accepted to identify water
projects for review by the project review committee and the board for
recommendation for funding to the state legislature as qualifying water
projects.
B. The authority
will provide forms and guidelines for water project proposals and financial
applications.
C. The authority staff will forward all completed water project proposals
from qualified applicants for qualified water projects to the project review
committee. The project review committee
will consider the water project and may confer with outside parties, including
any local interdisciplinary teams familiar with the water project, as necessary
to obtain more information on the feasibility, merit, and cost of the water
project. The project review committee
will make a recommendation to the board on each water project proposal.
D. Upon
the recommendation of the project review committee, the board will evaluate the
qualifying water projects for recommendation to the legislature.
E. After
completion of the review process by the project review committee and the board
and receipt of a favorable recommendation on the water project proposal, the water
project will be recommended by the board for approval by the state legislature,
which recommendation and approval are required by Sections 72-4A-5 and 72-4A-9
NMSA 1978.
F. No
later than January of each year, the board will recommend to the legislature a
list of projects recommended for funding. After the legislature authorizes
qualifying water projects, the project review committee will review evaluations
of financial applications and water project proposals prepared by staff and
recommend to the board a final list of projects to be authorized by the board
for funding by the authority. The authority will provide financial assistance
for qualifying projects as authorized by the legislature under policies jointly
established by the board and authority.
[19.25.10.9 NMAC -
Rp, 19.25.10.9 NMAC, 7/31/2008; A, 12/30/2013; A, 4/30/2015]
19.25.10.10 EVALUATION
OF FINANCIAL APPLICATION AND WATER PROJECT PROPOSAL: The
authority staff will complete an initial evaluation of the financial
application and water project proposal upon receipt. Such evaluation will
include, to the extent applicable, an evaluation of water project feasibility,
administrative capacity, financial position, debt management and economic and
demographic factors. The authority may rely upon the advice of an
interdisciplinary team in evaluating water project proposals and financial
applications.
[19.25.10.10 NMAC -
Rp, 19.25.10.10 NMAC, 7/31/2008]
19.25.10.11 QUALIFYING
WATER PROJECTS AND ELIGIBLE COSTS:
A. The board may authorize the authority to provide financial assistance
from the water project fund to qualifying entities only for qualifying water
projects as provided by Section 72-4A-6 and Section 72-4A-7, NMSA 1978.
B. Financial
assistance shall be made only to qualify entities that:
(1) agree
to provide for the operation and maintenance of the water project so that it
will function properly over the structural and material design life [which
shall not be less than twenty years];
(2) require
the contractor of the construction project to post a performance and payment
bond in accordance with the requirements of Section 13-4-18, NMSA 1978;
(3) provide
written assurance signed by an attorney or provide a title insurance policy
that the political subdivision has proper title, easements and rights of way to
the property upon or through which the water project proposed for funding is to
be constructed or extended;
(4) meet
the requirements of the financial capability set by the [board]
authority to ensure sufficient revenues to operate and maintain the water
project for its useful life and to repay the loan;
(5) agree
to properly maintain financial records [and to do an audit of the project’s
financial records] in accordance with all applicable laws; and
(6) agree
to pay costs of originating grants and loans as determined by rules adopted by
the [board] authority.
C. Plans and
specifications for a water project shall be approved by the authority after
review and upon the recommendation of the state engineer and the environment
department before grant or loan disbursements to pay for construction costs are
made to a qualifying entity. Plans and
specifications for a water project shall incorporate available technologies and
operational design for water efficiency.
D. Financial
assistance shall be made for eligible items, which include:
(1) matching
requirements for federal and local cost shares;
(2) engineering
feasibility reports;
(3) contracted
engineering design;
(4) inspection
of construction;
(5) special
engineering services;
(6) environmental
or archeological surveys;
(7) construction;
(8) land
acquisition;
(9) easements
and rights of way; and
(10) legal
costs.
E. A qualified
entity which has had financial assistance approved by the state legislature for
financing a qualifying water project may apply to the board to redirect the
financial assistance to a different water project made necessary by
unanticipated events. The decision to
redirect the financial assistance to a different
qualifying water project will be at the sole discretion of the board and
subject to approval of the state legislature as required by Subsection B of
Section 72-4A-9, NMSA 1978.
[19.25.10.11 NMAC - Rp,
19.25.10.11 NMAC, 7/31/2008; A, 5/28/2010; A, 4/22/2025]
19.25.10.12 QUALIFYING
WATER PROJECT FINANCING: The authority may provide financial
assistance packages that include loans, grants and any other type of assistance
authorized by the authority. The
structure, terms and conditions of the financial assistance will be determined
by the authority. Financial assistance
for qualifying water projects may be pooled, at the sole discretion of the
authority, under policies jointly established by the board and authority.
[19.25.10.12 NMAC -
Rp, 19.25.10.12 NMAC, 7/31/2008; A, 4/30/2015]
19.25.10.13 FINANCING
APPROVAL REQUIREMENTS: Based on the priority and evaluation factors
set forth in Sections 19.25.10.8, 19.25.10.10, and 19.25.10.11, the board may
recommend to the authority approval of the qualifying water project for
financial assistance.
[19.25.10.13 NMAC -
Rp, 19.25.10.13 NMAC, 7/31/2008]
19.25.10.14 RECONSIDERATION OF BOARD DECISIONS: Any
applicant or qualifying entity may request reconsideration of a decision of the
board by notifying the board in writing within 15 days following the meeting at
which the decision was made. Notice of a decision made in an open meeting of
the board is deemed to be given on the date of the meeting, and the time for
notification of a request for reconsideration shall run from that date,
regardless whether any written notice of the decision is given by the board. A request for reconsideration shall state
with particularity the grounds for reconsideration, including any factual or
legal matter on which the applicant or qualifying entity believes that there
was an error by the board. Upon receiving a timely and proper request for
reconsideration, the chairman of the board will set the matter for
reconsideration at the board’s next regularly scheduled meeting or at a special
meeting called for the purpose, at the chairman’s discretion, Upon
reconsideration by the board, the board will notify the applicant or qualifying
entity of the board’s decision, in writing, within five working days of the
decision. The decision of the board on
reconsideration is final. A request for
reconsideration not timely or properly made will not be considered by the
board.
[19.25.10.14 NMAC -
Rp, 19.25.10.14 NMAC, 7/31/2008; A, 5/28/2010]
19.25.10.15 FINANCIAL ASSISTANCE AGREEMENT:
A. The
authority and the qualified entity will enter into an agreement to establish
the terms and conditions of financial assistance from the water project
fund. The agreement will include the
terms of repayment and remedies available to the authority in the event of a
default. The authority will monitor
terms of the agreement and enforce or cause to be enforced all terms and
conditions thereof, including prompt notice and collection.
B. The
interest on any financial assistance extended shall be determined by the
authority based on the cost of funds and ability of a qualified entity to repay
a loan. The interest rate shall not
change during the term of the financial assistance unless refinanced or unless
the financial assistance is structured as a variable rate obligation.
C. The
agreement will contain provisions which require financial assistance recipients
to comply with all applicable federal, state and local laws and regulations.
D. In the
event of default under a financial assistance agreement by a qualified entity,
the authority may enforce its rights by suit or mandamus and may utilize all
other available remedies under state and applicable federal law.
[19.25.10.15 NMAC -
Rp, 19.25.10.15 NMAC, 7/31/2008; A, 12/30/2013]
19.25.10.16 ADMINISTRATIVE
COSTS:
A. The
board may impose and collect reasonable fees and costs in connection with the
filing of a water project proposal or a financial application for approval of a
water project and for financial assistance with the board and the authority. The board also may impose and collect an
administrative fee from each qualifying entity that receives financial
assistance from the water project fund.
If an administrative fee is assessed, the administrative fee will be a
percentage of the principal amount of the financial assistance provided to a
qualifying entity. The administrative
fee may be withheld from the principal amount of the financial assistance and
will be retained in the water project fund.
Alternatively, the board may levy an annual fee equal to a percentage of
the outstanding principal amount of a loan.
Specific percentages will be based on, among other things, the volume of
financial assistance being provided to qualifying entities, the administrative
costs of the board and the authority, and the availability of other revenue
sources to cover the board’s and the authority’s administrative costs. The filing and administrative fee or fees may
be used for, among other purposes, reimbursing the board or the authority for
all or part of the costs of issuing bonds and other administrative costs,
including any audits of the water project fund and the water trust fund.
B. The board and the authority may establish such other charges, premiums,
fees and penalties deemed necessary for the administration of the water project
fund and the water trust fund.
[19.25.10.16 NMAC -
Rp, 19.25.10.16 NMAC, 7/31/2008]
19.25.10.17 ADMINISTRATION OF THE WATER TRUST FUND:
A. The
water trust fund shall be administered by the state treasurer’s office and
shall be invested by the state investment officer in the same manner as land
grant permanent funds are invested under state law. All investment earnings on
the water trust fund shall be credited to the water trust fund. The water trust fund shall not be expended
for any purpose.
B. Annual
distributions to the water project fund from the water trust fund shall be made
as required by the authority.
[19.25.10.17 NMAC -
Rp, 19.25.10.17 NMAC, 7/31/2008]
19.25.10.18 ADMINISTRATION
OF THE WATER PROJECT FUND:
A. The water project fund shall be
administered by the authority as a separate account but may consist of such subaccounts
as the authority deems necessary to carry out the purposes of the fund.
B. Money in the water project fund may be used by the authority to (1) make loans or grants to qualified entities recommended by the water trust board, (2) hire contractors to provide financial and administrative capacity development and direct technical assistance to entities on water projects, and (3) pay administrative costs of the authority.
C. Money from repayments of loans made by the
board for qualifying water projects shall be deposited in the water project
fund. The water project fund shall also
consist of any other money appropriated, distributed or otherwise allocated to
the water project fund for the purpose of financing qualifying water projects.
D. The authority shall adopt a uniform
accounting system for the water project fund and each account and subaccount
established by the authority, based on generally accepted accounting
principles.
E. The
authority may establish procedures and adopt rules as required to administer
the fund and to recover from the fund costs of administering the fund and
originating grants and loans.
[19.25.10.18 NMAC - Rp, 19.25.10.18 NMAC,
7/31/2008; A, 4/22/2025]
19.25.10.19 BOND
ISSUANCE:
A. The
authority may issue and sell revenue bonds as required to provide funds to:
(1) replenish
the principal balance of the water project fund;
(2) pay,
fund or refund the principal of or interest or redemption premiums, if any, on
bonds issued by the authority whether the bonds or interest to be paid, funded
or refunded have or have not become due;
(3) establish
or increase reserve funds to secure bonds; and
(4) pay
the costs and expenses incident to the issuance of bonds.
B. The
authority will consider market and other economic conditions in determining the
type of sale and the timing of the issuance of bonds.
C. The bonds shall
be authorized and issued by the authority in accordance with the provisions of
the New Mexico Finance Authority Act, Chapter 6, Article 21, NMSA 1978.
[19.25.10.19 NMAC -
Rp, 19.25.10.19 NMAC, 7/31/2008]
19.25.10.20 AMENDMENT OF RULES: This
rule may be amended or repealed at any time by a majority vote of a quorum of
the board.
[19.25.10.20 NMAC -
Rp, 19.25.10.20 NMAC, 7/31/2008]
HISTORY OF 19.25.10 NMAC:
Pre-NMAC History: None.
History of Repealed Material:
19.25.10 NMAC,
Review and Eligibility of Proposed Water Projects (filed 9/3/2002) repealed
7/31/2008.
NMAC History:
19.25.10 NMAC,
Review and Eligibility of Proposed Water Projects (filed 9/3/2002) was replaced
by 19.25.10 NMAC, Review and Eligibility of Proposed Water Projects, effective
7/31/2008.