This story is republished from NM Political Report, a nonprofit news outlet, as a part of our commitment to bringing you the best in independent news coverage that matters to Albuquerque.
By Hannah Grover
The New Mexico House of Representatives passed legislation Monday that would increase pay for workers on projects that have been issued industrial revenue bonds.
This could impact renewable energy projects that often ask counties to issue industrial revenue bonds. These bonds are one of the primary economic development tools in New Mexico.
HB 6 would require developers whose projects receive industrial revenue bonds to pay prevailing wages and fringe benefits to workers. The House approved it with a 41-26 vote.
Prevailing wage tends to be higher than minimum wage and is based on geographic location. The prevailing wage is generally based in part on market conditions.
HB 6 sponsor Rep. Joseph Sanchez, D-Alcalde, said municipalities and counties use industrial revenue bonds to support relocating and expanding businesses that the cities and countioes believe will create jobs.
“Projects that receive IRBs remain under the control of their private sector owners, but are treated like government property for the purpose of taxation,” Sanchez said.
That means these projects can be exempt from property tax and gross receipts taxes on equipment.
Sanchez said some of the businesses that may be interested in industrial revenue bonds include manufacturers, agricultural processing, warehousing and distribution services, water distribution, electricity generation and transmission.
He said Amazon, Netflix and Intel have received industrial revenue bonds in the past. Other projects that have received or sought industrial revenue bonds include wind energy, solar and electricity transmission.
The prevailing wage requirement would not apply to existing projects that have been issued industrial revenue bonds. Instead, it would only apply to projects that receive these bonds if the bill goes into effect this summer.
The Bernalillo County Commission passed a resolution last week supporting HB 6.
Republicans who opposed the bill argued it would raise the costs of projects.
“This will make it more difficult for projects that are not successful,” Rep. Randall Pettigrew, R-Lovington, said.
Rep. John Block, R-Alamogordo, twice unsuccessfully attempted to amend HB 6 to create exceptions to the prevailing wage requirements.
HB 6 now heads to the Senate.