Section 6-21-6.14 - Lease purchase revenue bonds; lease purchase agreements. - New Mexico Statutes

6-21-6.14. Lease purchase revenue bonds; lease purchase agreements.

A.     If specifically authorized by law, the authority may issue and sell lease purchase revenue bonds in compliance with the New Mexico Finance Authority Act and enter into a lease purchase agreement pursuant to the provisions of this section.

B.     Lease purchase revenue bonds may be issued at times and on terms established by the authority and shall be paid exclusively from a debt service fund created pursuant to this section.  The net proceeds from the sale of lease purchase revenue bonds are appropriated to the authority for the purpose of acquiring by construction or purchase the buildings, land or infrastructure specified in the authorizing law; provided that, if authorized by law, the net proceeds may also be used for debt service payments due before sufficient lease payments have been deposited into the applicable debt service fund.

C.     All lease purchase revenue bonds issued by the authority shall be obligations of the authority payable solely from the separate debt service fund created for those bonds.  The bonds shall not create an obligation, debt or liability of the state and no breach of any pledge, obligation or agreement of the authority shall impose a pecuniary liability or charge upon the general credit or taxing power of the state or any political subdivision of the state.

D.     The authority may purchase lease purchase revenue bonds with money in the public project revolving fund pursuant to the provisions of Section 6-21-6 NMSA 1978.

E.     A debt service fund shall be created in the authority for each authorized issuance of lease purchase revenue bonds.  Each fund shall consist of transfers to the fund, legislative appropriations, lease payments made by the property control division of the general services department or other lessee pursuant to the authorized lease purchase agreement and money earned from investment of the fund.  Balances remaining in a fund at the end of a fiscal year shall not revert.  Money in each fund is appropriated to the authority for:

(1)     the payment of principal, interest, premiums and expenses on the specific lease purchase revenue bonds that are issued pursuant to the bond authorization; and

(2)     if authorized by law, required maintenance and repairs of the building, land or infrastructure if the authority determines that money in the fund is sufficient to meet the requirements of Paragraph (1) of this subsection plus any required reserve.

F.     Upon the certification of the authority that all debt service on a specific issuance of lease purchase revenue bonds has been paid in full, any remaining balance of the debt service fund created for those bonds shall be transferred to the general fund.

G.     The authority may enter into an agreement with the property control division of the general services department or other agency specified by law for the lease purchase of the building acquired with the lease purchase revenue bond proceeds.  The agreement shall provide the lessee with an option to purchase for a price that is reduced according to the lease payments made and shall also provide that:

(1)     there is no legal obligation for the state to continue the lease from year to year or to purchase the building;

(2)     the lease shall be terminated if sufficient appropriations are not available to meet the current lease payments; 

(3)     if authorized by the legislature, the lease payments include a maintenance component that may escalate annually and, over the length of the agreement, approximate the amount that will be needed for the maintenance and repair of the building; and

(4)     if the lessee is the property control division of the general services department or an agency under the jurisdiction of the property control division, the title to the building shall be issued in the name of the property control division if the building is purchased.

H.     The provisions of this section apply to state buildings specifically authorized by law to be acquired pursuant to this section through lease purchase agreements with the authority.  Nothing in this section limits or otherwise affects the power that the authority has under other laws to incur debt, acquire and dispose of property or enter into agreements.