HB 295 amends New Mexico’s property tax law to create a specific exemption for improvements on land owned by the New Mexico Renewable Energy Transmission Authority (often referred to as NM RETA) while the authority holds title to the property. The bill adds language to the Property Tax Code clarifying that, although improvements on exempt-entity land are generally taxable when owned or leased by a nonexempt entity, that rule will not apply to certain electric transmission and interconnected storage facilities, related structures, and supporting infrastructure acquired by NM RETA and qualifying as eligible facilities under the Renewable Energy Transmission Authority Act.
The measure also addresses how fractional interests in property are treated for valuation and exemption purposes, but its practical effect is to ensure that qualifying transmission-related improvements associated with NM RETA remain exempt from property taxation. The exemption applies only so long as the authority owns title to the property, and the bill is set to apply beginning with the 2026 property tax year.
Impact
HB 295 narrows the general rule that improvements on exempt-entity land are taxable when held by a nonexempt entity by carving out a targeted exemption for NM RETA’s qualifying transmission and storage infrastructure. This changes the Property Tax Code’s treatment of certain public energy infrastructure and removes those improvements, including related leasehold interests, from local property tax rolls while title remains with the authority. The bill affects valuation authorities, local taxing jurisdictions, NM RETA, and private entities that may lease or operate the facilities.
Sentiment
The voting history suggests the bill had majority support in both chambers but was not unanimous, indicating a generally favorable view with some reservations. It passed the House 37-27 and the Senate 22-18, which points to a partisan or policy split rather than broad consensus. No committee transcripts are available, so the recorded votes are the main indicator of sentiment.
Contention
The likely point of contention is the creation of a special property tax exemption for a specific state authority and its infrastructure, which may be viewed as a tax preference for energy transmission projects. Supporters likely saw the exemption as necessary to facilitate development and operation of renewable energy transmission facilities, while opponents may have objected to reducing the property tax base or granting a targeted exemption to a particular public entity and its private lessees. The split votes in both chambers suggest disagreement over the fiscal impact and whether the exemption should be limited to this class of property.