A. For the purposes of this section:

(1) "formal bid process" means a competitive sealed bid process;

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

(3) "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;

(4) "public works contract" means a contract for construction, construction management, architectural, landscape architectural, engineering, surveying or interior design services;

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

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

B. For the purpose of awarding a public works contract using a formal bid process, a public body shall deem a bid submitted by a:

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

(2) resident veteran contractor 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 awards a contract 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 contractor; or

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

D. 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 an additional of the equivalent of:

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

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

E. When a joint bid or joint proposal is submitted by a combination of resident veteran, resident or nonresident contractors, the preference provided pursuant to Subsection B, C or D 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 contractor as specified in the joint bid or joint proposal.

F. A resident veteran contractor 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 contractor 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.

G. A public body shall not award a contractor both a resident contractor preference and a resident veteran contractor preference.

H. 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.

History: 1978 Comp., § 13-4-2, enacted by Laws 1984, ch. 66, § 2; 1988, ch. 84, § 3; 1989, ch. 310, § 2; 1997, ch. 1, § 3; 1997, ch. 2, § 3; 2001, ch. 174, § 1; 2011 (1st S.S.), ch. 3, § 5; 2012, ch. 56, § 5; 2012, ch. 56, § 6; 2016, ch. 5, § 2.

Repeals. — Laws 2016, ch. 5, § 4, effective July 1, 2016, repealed Laws 2012, ch. 56, § 6, 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 1984, ch. 66, § 2, repealed former 13-4-2 NMSA 1978, as amended by Laws 1965, ch. 185, § 2.

The 2016 amendment, effective July 1, 2016, reduced the maximum revenue that a resident veteran contractor can earn to receive the veteran contractor 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 contractor preference, and limited the benefit to one business concurrently; in Subsection B, 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 resident veteran contractor 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 resident veteran contractor preference; in Subsection D, 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 resident veteran contractor preference; deleted former Subsection F, which limited the former tiered resident veteran contractor preferences to an aggregate of ten million dollars ($10,000,000) in purchases by public bodies from all resident veteran contractors receiving preferences; and added a new Subsection F.

The 2012 amendment, effective July 1, 2012, gave resident veteran businesses a preference; in the title, deleted "Resident contractor defined"; in Subsection A, in Paragraph (5), after "Section 13-1-22 NMSA 1978", added the remainder of the sentence and added Paragraph (6); in Subsection B, added Paragraphs (2) through (4); in Subsection C, in the introductory sentence, after "proposals process", added the remainder of the sentence, in Paragraph (1), after "evaluating the proposals", deleted "shall be awarded" and after "resident contractor", deleted "based on the resident contractor possessing a valid resident contractor certificate; or", and added Paragraphs (2) through (4); in Subsection D, in the introductory sentence, added "When a public body makes a purchase using a formal request for proposal process, and" and after "point-based system", deleted "a" and added the remainder of the sentence, in Paragraph (1), at the beginning of the sentence, deleted "resident contractor shall be awarded the equivalent of", after "total possible points to", deleted "be awarded based on the" and added "a", and after "resident contractor", deleted "possessing a valid resident contractor certificate", and added Paragraphs (2) through (4); in Subsection E, after "proposal is submitted by", deleted "both resident and" and added "a combination of resident veteran, resident or", after "nonresident contractors, the", deleted "resident contractor", after "Subsection B", deleted "or", after "Subsection B, C", added "or D", after "this section shall be", deleted "reduced" and added "calculated", and after "will be performed by" deleted "a nonresident" and added "each"; and added Subsections F and G.

The 2011 (1st. S.S.) amendment, effective October 5, 2011, provided a five percent advantage to bids and proposals by resident contractors; eliminated the practice of brokering the preference through joint bids or proposals by resident and non-resident contractors by reducing the preference by the percentage of the contract performed by the nonresident contractor; eliminated the preference for New York state business enterprises; provided the procedure for protesting violations of this section; deleted former Sections A through E, which defined "resident contractor", "New Mexico resident contractor", "New York state business enterprise", and "affiliate", provided for awarding a contract to a resident contractor when the bid by the resident contractor is made lower, by the application of a five percent preference, than the lowest bid from a nonresident contractor, and provided for the certification of resident contractors and the issuance of a certification number by the state purchasing agent; and added new Subsections A through E.

The 2001 amendment, effective June 15, 2001, in Subsection B, deleted residency requirements for the majority of stockholders and those who have a beneficial interest in the corporations, partnerships, and trusts who bid with a New Mexico resident contractor in Paragraphs (1) and (2); deleted "and the individual shall be a citizen of and domiciled in the state" from Paragraph (3); deleted the paragraph designation D(1) and deleted Paragraph D(2), which contained the definition for "beneficially owned" or "beneficial interest".

The 1997 amendment, effective January 24, 1997, inserted "means a New Mexico resident contractor or a New York state business enterprise" in Subsection A; designated Subsection B and added "'New Mexico resident contractor' means" at the beginning; deleted "New Mexico" preceding "Unemployment Compensation Law" in Paragraph B(4); added Subsection C and redesignated former Subsections B through D as Subsections D through F and substituted "Subsection E" for "Subsection C" near the end of Subsection F(3).

Constitutionality. — Plaintiff shareholder's privileges and immunities claim under Article 4, § 2 of the United States Constitution was granted where defendant/state burdened the right to own a business by discriminating against owners solely on the basis of citizenship, and plaintiff was able to establish that § 13-1-21A(2) under the former Procurement Contract Code was a better-tailored statute than this section. C.S. McCrossan Constr., Inc. v. Rahn, 96 F. Supp. 2d 1238 (D.N.M. 2000) (decided prior to 2001 amendment, which amended residency requirement provision).

Equal protection. — This section does not violate the equal protection clause of the United States Constitution because encouraging economic development and supporting the state's road construction industry are legitimate purposes of the resident contractor preference statute. C.S. McCrossan Constr., Inc. v. Rahn, 96 F. Supp. 2d 1238 (D.N.M. 2000).

Application. — Where a county in New Mexico decided to build a jail and bypassed the resident preference for contractors found in Subsection E, the court of appeals found that the resident preference formula applied to all bids for public works contracts and had to be followed. Bradbury & Stamm Constr. v. Board of Cnty. Comm'rs, 2001-NMCA-106, 131 N.M. 293, 35 P.3d 298.

Am. Jur. 2d, A.L.R. and C.J.S. references. — 64 Am. Jur. 2d Public Works and Contracts §§ 66 to 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.

72 Supp. C.J.S. Public Contracts §§ 12, 15, 16.