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UPDATED: Law Tightens Contract Preference for N.M. Businesses

SANTA FE — Gov. Susana Martinez signed a measure into law on Wednesday to ensure New Mexico businesses hold an advantage over out-of-state competitors when bidding on state government contracts.

Supporters say the contracting preference can help provide jobs in New Mexico.

“This important law will assist local companies and create a more competitive playing field for New Mexico businesses,” Martinez said in a statement. “Making it easier for local businesses to succeed is a critical part of getting our economy back on track.”

The new law tightens contracting requirements to prevent out-of-state businesses from qualifying for a preference that’s supposed to go to in-state businesses when bidding on state-financed construction projects.

Under the contracting preference system, a bid by a qualified New Mexico business is considered 5 percent lower than the submitted amount — potentially helping the company be selected as the low bidder on a project.

The contracting preference previously didn’t apply to bids of more than $5 million, but that cap has been eliminated. The changes take effect immediately and were approved by the Legislature during a special session, which ended last month.

Sen. Tim Keller, an Albuquerque Democrat who sponsored the legislation, said “out-of-state businesses have been able to abuse the system by creating shell companies that pretend to be local businesses in order to win state contracts.”

Martinez announced the bill signing at a news conference at the headquarters of an Albuquerque construction company.

“By closing this loophole and creating a more favorable environment for in-state businesses, we will support companies that set up shop in our own back yard and hire New Mexico workers,” Martinez said.

Among the new requirements for being certified as a resident contractor, a company must prove it had leased or owned property in New Mexico for at least five years, paid taxes to the state and have at least three full-time employees who live in the state.

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Oct. 5, 2011 2:43 p.m.

By Barry Massey / The Associated Press

SANTA FE — Gov. Susana Martinez has signed legislation into law to ensure New Mexico businesses have an advantage over out-of-state competitors when bidding on state government contracts.

The governor signed the legislation on Wednesday, and supporters say the measure can help provide jobs in New Mexico.

The new law plugs loopholes that have allowed some out-of-state businesses to qualify for a preference that’s supposed to go to in-state businesses when bidding on state construction projects.

Under the preference law, a bid by a qualified New Mexico business is considered 5% lower than the submitted amount — potentially helping the company be selected as the low bidder on a project.

The Legislature approved the measure during a special session, which ended last month.

 

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