Current through Register Vol. 35, No. 18, September 24, 2024
A.
Economic development department role: The economic development
department determines company and project eligibility through initial project
data intake and vetting prior to invitation to formally apply for LEDA
investment funds. Due diligence is conducted throughout the application
process. The economic development department works with the executive branch to
determine an appropriate LEDA project investment based on capital expenditures,
job creation, location of relocating or expanding company and other factors
related to the public good.
(1) It is the
responsibility of the economic development department to conduct due diligence,
including a commercial credit check and fiscal analysis to determine the
benefit of the LEDA project and potential investment of state funds to the
local government and state.
(a) The Economic
Development Department will collect qualifying entity and project information
necessary to complete the Economic Impact Analysis (EIA) and an incentive
analysis of all applicable incentives within New Mexico.
(b) The economic development department will
confirm local government support for the project and identify any additional
local incentives.
(c) The economic
development department will prepare a LEDA summary which is provided to the
executive branch for its consideration of LEDA investment funds.
(2) Upon the executive branch's
provisional determination of the level of LEDA investment funding, the economic
development department will issue an offer of LEDA investment and an invitation
to formally apply for a LEDA grant to the qualifying entity. The provisional
offer is subject to the formal application, additional due diligence, and local
approval.
(3) The economic
development department will provide access to the online application to the
company representative designated to complete the LEDA application. Information
collected in a LEDA application includes, but is not limited to, the following
elements: company information and structure, project description, total capital
investment, land, building, equipment, infrastructure, total number, and types
of jobs to be created as well as projected job ramp, wages and benefits, up to
three years of financial statements, proformas, and sources and uses of all
funding. The economic development department reviews all LEDA applications and
approves when deemed complete and ready for the public process.
B.
Community role:
The local government acts as the fiscal agent for the receipt of initial LEDA
investment funds and subsequent disbursements/reimbursement of funds to the
qualifying entity based on the economic development department's approval. The
fiscal agent will keep all project funds in a separate account and obtain prior
approval from the economic development department for all disbursements to the
qualifying entity to ensure that all reimbursable expenses are eligible. The
economic development department will work with the fiscal agent and the
qualifying entity to ensure the qualifying entity maintains the performance
benchmarks for the term of the PPA. The fiscal agent is responsible for
tracking any outstanding LEDA project balances. Any unused LEDA funds revert to
the economic development department at the close of a project.
C.
Public process: All LEDA
projects are required to have a public hearing and the adoption of an ordinance
by the fiscal agent's governing body. The project ordinance passed by the local
community includes a PPA outlining the agreed upon scope of work between the
fiscal agent and the qualifying entity, an IGA between the fiscal agent and the
economic development department for the transfer and disbursement of public
funds. The PPA will include job creation requirements, public investment
distribution milestones (determined by established performance benchmarks) and
claw back requirements.
(1) Upon adoption of
the ordinance the economic development department will work with the qualifying
entity and the fiscal agent to execute the PPA, IGA and security
agreement.
(2) Once all LEDA
project documents have been fully executed the economic development department
will work with the fiscal agent to transfer LEDA investment money to the fiscal
agent.
D.
Reporting: All LEDA projects are required to submit quarterly job
reports and annual economic impact data per the terms outlined in the PPA.
(1) The economic development department will
work with the fiscal agent and the qualifying entity to ensure all reports are
accurate and timely.
(2) The
economic development department will provide the qualifying entity access to
the online reporting system to create and submit quarterly job reports and
actual annual economic impact data.
(3) The economic development department will
create an annual EIA using the actual economic impact data provided by the
qualifying entity to demonstrate return on investment.
E.
LEDA project closeout: A LEDA
project shall be closed out by passage by the fiscal agent governing body of a
repealing ordinance unless the enabling ordinance includes a sunset provision.
(1) The economic development department will
collect actual economic impact data from the qualifying entity to prepare a
final EIA and demonstrate return on investment.
(2) The economic development department will
assist the fiscal agent in closing out the LEDA project fund, returning any
unexpended funds to the economic development department, and the release of any
instrument of security for the LEDA project to the company.
(3) The fiscal agent is responsible for
enacting an ordinance to repeal the enabling ordinance when the project is
complete or all clawbacks have been received unless the enabling ordinance
includes a sunset provision.
