A. Prior to January 1, 2023, the department may transfer to the authority funds appropriated by the legislature to the department for the purpose of providing recovery grants to recovery entities pursuant to this section.

B. The department and the authority shall enter into a memorandum of understanding to develop a program for the authority to accept a transfer of funds from the department pursuant to Subsection A of this section, to provide recovery grants to recovery entities, to accept and review applications for recovery grants and to disburse recovery grants to recovery entities. The authority shall require documentation from applicants of employment levels and rent, lease and mortgage payments for taxable year 2020 and subsequent taxable years in which a recovery entity applies for a recovery grant. The authority shall prioritize funding to applicants that had the greatest decline in business revenues between comparable quarters in taxable year 2019 to taxable year 2020. The department shall provide oversight of the program and may set policies and promulgate rules in accordance with this section. The authority may designate one or more application periods and shall review applications received in each period and provide a determination to the applicant within a reasonable amount of time after review. The first application period shall accept applications no later than June 30, 2021, and the last application period shall accept applications no later than December 31, 2021; provided that an application period for funds set aside pursuant to Subsection E of this section shall accept applications no later than June 30, 2022. The authority shall prioritize funding to applicants that had the greatest decline in business revenues between comparable quarters in taxable year 2019 to taxable year 2020.

C. To receive a recovery grant, a recovery entity shall agree to:

(1)     use the proceeds of the recovery grant for reimbursement of rent, lease or mortgage obligations of the recovery entity for its business locations within the state of New Mexico;

(2)     provide a written certification signed by an appropriate officer of the recovery entity that certifies that:

(a) the officer understands that, pursuant to the Local Economic Development Act, the recovery grant shall be accompanied by new job creation in accordance with department rules and policies and the terms of the agreement issued by the authority to the recovery entity in advance of disbursement of the recovery grant;

(b) all documents submitted in support of the recovery grant application are true and accurate to the best of the officer’s knowledge;

(c) the officer has a reasonable basis to believe that, as of the date of a recovery grant application and receipt of any recovery grant, the recovery entity does not expect to permanently cease business operations or file for bankruptcy;

(d) as of the date of a recovery grant application and of receipt of a recovery grant, the recovery entity is current on all obligations pursuant to the Income Tax Act [N.M. Stat. Ann. Chapter 7, Article 2], the Corporate Income and Franchise Tax Act [N.M. Stat. Ann. Chapter 7, Article 2A], the Withholding Tax Act [N.M. Stat. Ann. Chapter 7, Article 3], the Gross Receipts and Compensating Tax Act [N.M. Stat. Ann. Chapter 7, Article 9] and the Unemployment Compensation Law [N.M. Stat. Ann. Chapter 51] applicable to the recovery entity’s business operations; and

(e) all recovery grant proceeds will be used for the purpose of payment of rent, lease or mortgage payments of the recovery entity pursuant to the Local Economic Development Act;

(3)     provide documentation to the authority demonstrating a decline in business revenues between taxable years 2019 and 2020;

(4)     upon request, provide the department and the authority with information relevant to the reporting requirements of the department and the authority pursuant to Subsection H of this section; and

(5)     submit an application to the authority for a recovery grant pursuant to rules established by the authority, but no later than June 30, 2022.

D. Up to one hundred thousand dollars ($100,000) in a recovery grant may be provided to each recovery entity in quarterly payments in an amount of up to twenty-five percent of the total amount of the recovery grant awarded to the recovery entity. The department shall promulgate rules to determine the amount of a recovery grant; provided that, for each quarterly payment a recovery entity may be awarded a specified amount for each job created depending on the wages provided and the relative decline in business revenues for taxable year 2020, not to exceed a total of twenty-five thousand dollars ($25,000) per quarter. To remain eligible for additional quarterly payments, a recovery entity shall provide documentation to the department and to the authority demonstrating the following:

(1)     the recovery entity remains active and open and can demonstrate a net increase in the number of full-time-equivalent employees relative to the immediately preceding quarter, as submitted quarterly to the workforce solutions department from the date of application to the date of receipt of a recovery grant payment;

(2)     the recovery entity is current on state and local tax obligations; and

(3)     the recovery entity paid rent, lease or mortgage obligations of the recovery entity for its business locations within the state of New Mexico from the date of application to the present request for a subsequent quarterly payment that exceeds all payments to the recovery entity to date pursuant to this section.

E. If, on the effective date of this section, there remains in effect a public health order that requires businesses to remain closed, the department and the authority shall set aside a portion of the funds available for recovery grants until such time as the public health order ceases to be in effect or is changed to permit all businesses subject to the public health order to be open. The portion set aside shall be estimated, at the discretion of the department and the authority, to represent the number of recovery entities and employees impacted by the public health order, but in no case shall exceed twenty percent of the total funds appropriated pursuant to Section 11 of this 2021 act.

F. If a recovery entity loses eligibility in a quarter, the authority shall set aside funds for the recovery entity to access should the recovery entity become eligible again in a succeeding quarter.

G. Information obtained by the department and the authority regarding individual recovery entity grant applicants shall be confidential and not subject to inspection pursuant to the Inspection of Public Records Act [N.M. Stat. Ann. Chapter 14, Article 2]; provided that nothing in this section shall prevent the department and the authority from disclosing broad demographic information and information relating to the total amount of recovery grants made, the total outstanding balance of recovery grants made and the names of the recovery entities that received recovery grants.

H. The department and the authority shall submit an annual report in each year of 2021 through 2023 to the legislature, the legislative finance committee, the New Mexico finance authority oversight committee, the revenue stabilization and tax policy committee and the interim legislative committee concerning economic and rural development. The report shall provide information regarding recovery grants made pursuant to this section. The report shall include:

(1)     the total dollar value of recovery grants made to date, along with breakouts of disbursements by quarterly payment number;

(2)     the number of recovery entities assisted, in total and by county;

(3)     the total number of new jobs created and the total number of employees currently employed by recovery entities that received grants;

(4)     the total projected annual payroll for the jobs created; (5)     the total number of recovery grant applications;

(6)     the number of recovery entities, if any, that received initial payments but were determined to be ineligible for additional quarterly payments; and

(7)     an overview of the industries and types of business entities represented by recovery entities that received recovery grants.

I. As used in this section:

(1)     “authority” means the New Mexico finance authority;

(2)     “recovery entity” means a corporation, limited liability company, partnership, joint venture, syndicate, association or other person that:

(a) is a business operating in New Mexico with one or more employees but with fewer than seventy-five people employed at any of the business’s business locations;

(b) is current on all state or local tax obligations; and

(c) experienced a decline in business revenue between one or more comparable quarters in taxable years 2019 and 2020, as determined by the economic development department and the authority based on documentation provided by the business;

(3)     “recovery grant” means a grant disbursed to a recovery entity by the authority from funds provided by the department for the purpose of reimbursement of rent, lease or mortgage payments of the recovery entity pursuant to the Local Economic Development Act; and

(4)     “taxable year” means “taxable year” as that term is used in the Income Tax Act or the Corporate Income and Franchise Tax Act, as applicable to a recovery entity.