July 1, 2024.) A. The “rural air service enhancement grant program” is created in the division to be administered by the director.

B. The director shall:

(1)     establish and publish deadlines and guidelines for the submission of grant applications;

(2)     develop procedures for receipt, review and approval of grant applications; (3)     receive, review and approve grant applications;

(4)     monitor municipalities’ and counties’ use of grant money by reviewing annual reports submitted to the director to ensure that grants are used consistently with the terms of the grant awards;

(5)     establish grant reporting requirements that meet the general purpose of the Rural Air Service Enhancement Act; and

(6)     perform other duties as necessary to carry out the provisions of the Rural Air Service Enhancement Act.

C. Each fiscal year, competitive grants for minimum revenue guarantees shall be awarded to applicants for the sole purpose of funding rural air service enhancement grants.

D. The director shall award grants to applicants through a competitive process and based upon the following criteria:

(1)     the demand for service on the proposed new air routes or expanded air routes;

(2)     the economic impact on the municipality or county of the proposed new air routes or expanded air routes; and

(3)     the feasibility of a common carrier servicing proposed new air routes or expanded air routes.

E. Applicants shall meet the following minimum criteria to be eligible for a grant: (1)     municipalities or counties shall have a minimum population of twenty thousand persons residing within a fifty-mile radius of the airport unless the municipality or county has existing air routes;

(2)     aircraft to be used to service proposed new air routes or expanded air routes served by the rural air service enhancement grant program shall have a passenger capacity of not more than one hundred persons; and

(3)     minimum matching funds from a municipality or county shall be:

(a) ten percent if the municipality or county has no existing scheduled air routes at the time of application; and

(b) twenty percent if the municipality or county has existing scheduled air routes at the time of application.

F. Individual grants awarded through the rural air service enhancement grant program shall not:

(1)     exceed two million two hundred fifty thousand dollars ($2,250,000) per year for municipalities or counties with existing scheduled air routes;

(2)     exceed two million seven hundred fifty thousand dollars ($2,750,000) per year for municipalities or counties not served by existing scheduled air routes; or

(3)     be used for infrastructure improvement.

G. Individual grants awarded through the rural air service enhancement grant program shall cover a time frame of at least two years. If funds are available in the rural air service enhancement fund, the director may extend the term of an existing grant up to three additional years.

H. No more than ten percent of the balance of the rural air service enhancement fund on July 1 of any year may be used by the division for infrastructure improvements associated with individual grants awarded through the rural air service enhancement grant program.

I. Funds received through individual grants awarded through the rural air service enhancement grant program shall be expended by the grantee municipality or county only to airlines that have been selected through a competitive process pursuant to the Procurement Code N.M. Stat. Ann. § 13-1-28 to 13-1-199.