A. For the purposes of this section:

(1) "business" means a commercial enterprise carried on for the purpose of selling goods or services, including growing, producing, processing or distributing agricultural products;

(2) "formal bid process" means a competitive bid process;

(3) "formal request for proposals process" means a competitive proposal process, including a competitive qualifications-based proposal process;

(4) "public body" means a department, commission, council, board, committee, institution, legislative body, agency, government corporation, educational institution or official of the executive, legislative or judicial branch of the government of the state or a political subdivision of the state and the agencies, instrumentalities and institutions thereof, including two-year post-secondary educational institutions, school districts, local school boards and all municipalities, including home-rule municipalities;

(5) "recycled content goods" means supplies and materials composed twenty-five percent or more of recycled materials; provided that the recycled materials content meets or exceeds the minimum content standards required by bid specifications;

(6) "resident business" means a business that has a valid resident business certificate issued by the taxation and revenue department pursuant to Section 13-1-22 NMSA 1978 but does not include a resident veteran business; and

(7) "resident veteran business" means a business that has a valid resident veteran business certificate issued by the taxation and revenue department pursuant to Section 13-1-22 NMSA 1978.

B. Except as provided in Subsection C of this section, when a public body makes a purchase using a formal bid process, the public body shall deem a bid submitted by a:

(1) resident business to be five percent lower than the bid actually submitted; or

(2) resident veteran business with annual gross revenues of up to three million dollars ($3,000,000) in the preceding tax year to be ten percent lower than the bid actually submitted.

C. When a public body makes a purchase using a formal bid process and the bids are received for both recycled content goods and nonrecycled content goods, the public body shall deem:

(1) bids submitted for recycled content goods from any business, except a resident veteran business, to be five percent lower than the bids actually submitted; or

(2) bids submitted for recycled content goods from a resident veteran business with annual gross revenues of up to three million dollars ($3,000,000) in the preceding tax year to be ten percent lower than the bids actually submitted.

D. When a public body makes a purchase using a formal request for proposals process, not including contracts awarded on a point-based system, the public body shall award an additional:

(1) five percent of the total weight of all the factors used in evaluating the proposals to a resident business; and

(2) ten percent of the total weight of all the factors used in evaluating the proposals to a resident veteran business that has annual gross revenues of up to three million dollars ($3,000,000) in the preceding tax year.

E. When a public body makes a purchase using a formal request for proposals process, and the contract is awarded based on a point-based system, the public body shall award additional points equivalent to:

(1) five percent of the total possible points to a resident business; or

(2) ten percent of the total possible points to a resident veteran business that has annual gross revenues of up to three million dollars ($3,000,000) in the preceding tax year.

F. When a joint bid or joint proposal is submitted by a combination of resident veteran, resident or nonresident businesses, the preference provided pursuant to Subsection B, C, D or E of this section shall be calculated in proportion to the percentage of the contract, based on the dollar amount of the goods or services provided under the contract, that will be performed by each business as specified in the joint bid or proposal.

G. A resident veteran business shall not benefit from the preference pursuant to this section for more than ten consecutive years. A person that is an owner of a business that is a resident veteran business shall not benefit from the preference pursuant to this section for more than ten consecutive years. A person shall not benefit from the provisions of this section based on more than one business concurrently.

H. A public body shall not award a business both a resident business preference and a resident veteran business preference.

I. The procedures provided in Sections 13-1-172 through 13-1-183 NMSA 1978 or in an applicable purchasing ordinance apply to a protest to a public body concerning the awarding of a contract in violation of this section.

J. This section shall not apply when the expenditure includes federal funds for a specific purchase.

History: 1978 Comp., § 13-1-21, enacted by Laws 1979, ch. 72, § 1; 1981, ch. 104, § 1; 1988, ch. 84, § 1; 1989, ch. 310, § 1; 1995, ch. 60, § 1; 1997, ch. 1, § 2; 1997, ch. 2, § 2; 1997, ch. 3, § 1; 2000, ch. 41, § 1; 2011 (1st S.S.), ch. 3, § 1; 2012, ch. 56, § 1; 2012, ch. 56, § 2; 2016, ch. 5, § 1.

Repeals. — Laws 2016, ch. 5, § 4, effective July 1, 2016, repealed Laws 2012, ch. 56, § 2, which was to become effective July 1, 2022. For provisions of former section, see the 2015 NMSA 1978 on NMOneSource.com.

Repeals and reenactments. — Laws 1979, ch. 72, § 1, repealed former 13-1-21 NMSA 1978, relating to resident preference, and enacted a new 13-1-21 NMSA 1978.

Laws 1968, ch. 72, § 9, repealed former 6-5-32, 1953 Comp., relating to resident preference, and enacted a similar provision, also designated 6-5-32, 1953 Comp.

The 2016 amendment, effective July 1, 2016, reduced the maximum revenue that a resident veteran business can earn to receive the veteran business preference, merged the former tiered preferences into one ten percent preference, set a ten consecutive year maximum time for a vendor to use the resident veteran preference, and limited the benefit to one business concurrently; in Subsection A, Paragraph (3), after each occurrence of "competitive", deleted "sealed"; in Subsection B, Paragraph (1), after the semicolon, added "or", in Paragraph (2), after "annual", added "gross", after "revenues of", deleted "one million dollars ($1,000,000) or less" and added "up to three million dollars ($3,000,000) in the preceding tax year", and deleted Paragraphs (3) and (4) which provided for a tiered veteran business preference; in Subsection C, Paragraph (1), after the semicolon, added "or", in Paragraph (2), after "annual", added "gross", and after "revenues of", deleted "one million dollars ($1,000,000) or less" and added "up to three million dollars ($3,000,000) in the preceding tax year", and deleted Paragraphs (3) and (4) which provided for a tiered veteran business preference; in Subsection D, Paragraph (1), after "business", added "and", in Paragraph (2), after "annual", added "gross", and after "revenues of", deleted "one million dollars ($1,000,000) or less" and added "up to three million dollars ($3,000,000) in the preceding tax year", and deleted Paragraphs (3) and (4) which provided for a tiered veteran business preference; in Subsection E, in the introductory sentence, after "award", deleted "an", after "additional", deleted "of the" and added "points", and after "equivalent", deleted "of" and added "to", in Paragraph (1), after the semicolon, added "or", in Paragraph (2), after "annual", added "gross", and after "revenues of", deleted "one million dollars ($1,000,000) or less" and added "up to three million dollars ($3,000,000) in the preceding tax year", and deleted Paragraphs (3) and (4), which provided for a tiered veteran business preference; deleted former Subsection G, which limited the former tiered veteran business preferences to an aggregate of ten million dollars ($10,000,000) in purchases by public bodies from all resident veteran businesses receiving preferences; and added a new Subsection G.

The 2012 amendment, effective July 1, 2012, alphabetized terms; gave resident veteran businesses a preference; limited the preference in any calendar year to an aggregate of ten million dollars in purchases by public bodies from all resident veteran businesses receiving preferences; in Subsection A, added Paragraph (5) and deleted former Paragraph (6) to alphabetize the definition of "recycled content goods", in Paragraph (6), after "Section 13-1-22 NMSA 1978", added the remainder of the sentence, and added Paragraph (7); in Subsection B, in the introductory sentence, added "Except as provided in Subsection C of this section", and added Paragraphs (3) through (4); added Subsection C; in Subsection D, after "request for proposals process", added the remainder of the sentence, in Paragraph (1), after "evaluating the proposals", deleted "shall be awarded" and after "resident business", deleted "based on the resident business possessing a valid resident business certificate; or", and added Paragraphs (2) through (4); in Subsection E, in the introductory sentence, added "When a public body makes a purchase using a formal request for proposals process" and after "point-based system", added the remainder of the sentence, in Paragraph (1), at the beginning of the sentence, deleted "a resident business shall be awarded the equivalent of", after "total possible points to", deleted "be awarded based on the" and added "a", and after "resident business", deleted "possessing a valid resident business certificate", and added Paragraphs (2) through (4); in Subsection F, after "proposal is submitted by", deleted "both resident and" and added "a combination of resident veteran, resident or", after "nonresident businesses, the", deleted "resident business", after "Subsection B, C", added "D or E", after "this section shall be", deleted "reduced" and added "calculated", and after "will be performed by", deleted "a nonresident" and added "each"; deleted former Subsection E, which provided a five percent preference for recycled content goods of equal quality when bids were received for the recycled content goods and nonrecycled content goods; and added Subsections G and H.

The 2011 (1st. S.S.) amendment, effective October 5, 2011, provided a five percent advantage to bids and proposals by resident businesses and to recycled content goods; specified the minimum percentage of recycled materials in recycled content goods; eliminated the practice of brokering the preference through joint bids or proposals by resident and non-resident businesses by reducing the preference by the percentage of the contract performed by the nonresident business; eliminated the preference for resident manufacturers and New York state business enterprises; expanded the application of the resident business preference to contracts larger than $5,000,000; provided the procedure for protesting violations of this section; deleted former Paragraphs (2) through (4) and (6) of Subsection A, which defined "New Mexico resident business", "New York state business enterprise", "resident manufacturer", and "virgin content goods"; added Paragraphs (1) through (4) of Subsection A; in Paragraph (5) of Subsection A, after "means a", deleted "New Mexico resident business or a New York state business enterprise" and added the remainder of the sentence; in Paragraph (6) of Subsection A, after "materials composed", deleted "in whole or in part" and added "twenty-five percent or more"; deleted former Subsections B through J,which provided rules for awarding contracts for goods and services when the bid from a resident business or resident manufacturer or for virgin content goods and recycled goods is made lower, by the application of the five percent preference, than the lowest bid from other bidders; added new Subsections B through F; in Subsection G, after "when the expenditure", deleted "of" and added "includes", after the phrase "federal funds", deleted "designated", and at the end of the sentence, deleted "is involved or for any bid price greater than five million dollars ($5,000,000)"; and deleted former Subsection L, which exempted the purchase of buses from resident manufacturers and resident businesses that manufactures buses in New Mexico.

The 2000 amendment, effective March 6, 2000, added Subsection L.

The 1997 amendment, January 24, 1997, in Subsection A, inserted "a New Mexico resident business or a New York state business enterprise;" in Paragraph (1); designated Paragraph (2), adding "'New Mexico resident business' means" at the beginning; added Paragraph (3), redesignating former Paragraphs (2) through (5) as Paragraphs (4) through (6), and added the proviso at the end of Paragraph (4).

The 1995 amendment, effective June 16, 1995, substituted "a business that" for "one which" in Paragraph (1) in Subsection A, added Paragraphs (3) and (4) in Subsection A, added Subsections G through J, and redesignated former Subsection G as Subsection K.

Policy. — The underlying policy of this section is to give a preference to those persons and companies who contribute to the economy of the state of New Mexico by maintaining plants and other facilities within the state and giving employment to residents of the state. 1969 Op. Att'y Gen. No. 69-42.

Multiple preference policy. — A bidder who offers materials grown, processed or manufactured in this state may not claim both the manufacturer's 5% preference and the resident dealer's 5% preference against an out-of-state supplier, giving the in-state supplier a 10% preference. 1968 Op. Att'y Gen. No. 68-42.

Am. Jur. 2d, A.L.R. and C.J.S. references. — 64 Am. Jur. 2d Public Works and Contracts §§ 52, 54, 67, 69.

Constitutionality of enactment or regulation forbidding or restricting employment of aliens in public employment or on public works, 38 A.L.R.3d 1213.

Validity, construction, and effect of requirement under state statute or local ordinance giving local or locally qualified contractors a percentage preference in determining lowest bid, 89 A.L.R.4th 587.

72 Supp. C.J.S. Public Contracts §§ 7 to 9, 16.