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Bill upholds tax levy on national labs

Copyright © 2019 Albuquerque Journal

Legislation that would allow New Mexico to continue taxing national laboratory operators even when they have nonprofit status quickly made its way through the House on Sunday.

A fiscal analysis of the bill found that if the prime contractor of Los Alamos National Laboratory had tax-exempt status, the state could lose $25 million to $30 million in gross receipts tax revenue.

Rep. Christine Chandler, D-Los Alamos, said Senate Bill 11 ensures revenue stability for local governments, too.

The bill seeks to amend the section of state statute that exempts nonprofit organizations from paying GRT. It would create an exception permitting the state to tax nonprofits that have been contracted to operate a national laboratory.

Gov. Susana Martinez vetoed similar legislation last year.

The House passed the bill with a minor amendment that broadened the exception to include contractors running state-owned research facilities as well, though that does not currently exist in New Mexico.

Rep. Jason Harper, R-Rio Rancho, said the change would not “capture anyone” but it would also stop the bill from singling out federal facilities. The bill now returns to the Senate for consideration.

Triad National Security LLC, which the analysis said is organized as a non-profit and could seek to become tax exempt, ultimately took over management of LANL. Triad is made up of the University of California, Texas A&M University and the scientific non-profit Battelle Memorial Institute and is a non-profit itself.

The bill is not likely to affect New Mexico’s other national laboratory anytime soon. A subsidiary of Honeywell International took over management of Sandia National Laboratories in 2017. According to the fiscal analysis, Sandia paid $95 million in GRT in 2018.

Also on Sunday, the House:

• Passed a package of legislation that would make numerous changes to the state’s criminal justice system. House Bills 342 and 564 include a range of ideas that, supporters say, have previously seen broad support or were created with experts at the Council of State Governments.

• Approved House Bill 284, which would give New Mexico residents free admission to state parks on Sundays.

• Amended and approved House Bill 141, to stop state employees from disclosing sensitive personal information acquired through their jobs.

• Passed House Bill 234, a measure to add public service officers to the list of people who can commit a person to a detoxification facility.

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