A. The "credit enhancement account" is created as a separate account within the authority for use only as provided in this section.

B. All cigarette tax proceeds distributed each month to the authority pursuant to Subsection E of Section 7-1-6.11 NMSA 1978 shall be deposited in the credit enhancement account.

C. Amounts deposited in the credit enhancement account may be pledged irrevocably as additional security for the payment of the principal, interest, premiums and expenses on bonds issued by the authority for:

(1) designing, constructing, equipping and furnishing additions and improvements to the university of New Mexico hospital and the comprehensive cancer center at the university of New Mexico health sciences center; and

(2) land acquisition and the planning, designing, construction and equipping of department of health facilities or improvements to such facilities.

D. The authority shall determine monthly upon receipt of cigarette tax proceeds if the individual amounts of cigarette tax proceeds distributed pursuant to Subsection C or Subsection D, respectively, of Section 7-1-6.11 NMSA 1978 are sufficient to meet the monthly amount required for immediate payment or designation for payment of principal, interest, premiums and expenses on bonds additionally secured by the credit enhancement account. Any insufficient amount shall be paid immediately from the credit enhancement account. A payment from the credit enhancement account shall be reimbursed in succeeding months from the individual amount of cigarette tax proceeds distributed pursuant to Subsection C or Subsection D, as applicable, of Section 7-1-6.11 NMSA 1978 in excess of the amount required for immediate payment or designation for payment of principal, interest, premiums and expenses on bonds. All money in the credit enhancement account in excess of the monthly amount required for immediate payment or designation for payment of principal, interest, premiums and expenses on bonds shall be transferred monthly by the authority to the general fund.

E. Upon payment of all principal, interest, premiums and expenses on bonds additionally secured by a pledge of amounts deposited in the credit enhancement account, the authority shall certify to the secretary of taxation and revenue that all obligations for bonds have been fully discharged and shall direct the secretary of taxation and revenue and the state treasurer to cease distributing cigarette tax proceeds to the authority pursuant to Subsection E of Section 7-1-6.11 NMSA 1978 and to distribute those cigarette tax proceeds to the general fund.

F. Any law authorizing the imposition, collection or distribution of the cigarette tax or that affects the cigarette tax shall not be amended, repealed or otherwise directly or indirectly modified so as to impair or reduce debt service coverage for any outstanding revenue bonds that may be secured by a pledge of those cigarette tax proceeds distributed to the credit enhancement account, unless the revenue bonds have been discharged in full or provisions have been made for a full discharge.

History: Laws 2003, ch. 341, § 5; 2005, ch. 320, § 5; 2017, ch. 63, § 1.

The 2017 amendment, effective June 16, 2017, amended a provision that designated funds from the credit enhancement account to reflect the comprehensive designation and new name of the cancer center at the university of New Mexico health sciences center, and made technical changes to conform to amendments to Section 7-1-6.11 NMSA 1978; in Subsection B, after "Subsection", changed "G" to "E"; in Subsection C, Paragraph C(1), after "hospital and the", added "comprehensive", and after "cancer", deleted "research and treatment"; in Subsection D, after "Subsection", changed "E" to "C", after the second occurrence of "Subsection", changed "F" to "D", after the third occurrence of "Subsection", changed "E" to "C", and after the fourth occurrence of "Subsection" changed "F" to "D"; and in Subsection E, after "Subsection", changed "G" to "E".

The 2005 amendment, effective June 17, 2005, provided in Subsection C(2) that amounts in the credit enhancement account may be pledged for land acquisition and the planning, designing, construction and equipping and making improvements to department of health facilities; and provided in Subsection F that the cigarette tax laws shall not be changed to reduce debt coverage for any outstanding bonds.