OPINION: Equitable Disclosure Legislation: A Win-Win for New Mexico's Economy and Business Community

New Mexico stands at a pivotal moment to redefine property tax assessments for commercial real estate with fairness and transparency. A groundbreaking new legislative proposal, developed in collaboration between the County Assessors Affiliate and the business community, ensures that businesses can plan with confidence while the state secures reliable property tax revenues.

This legislation offers a balanced approach to one of the most critical issues facing commercial property owners today: the unpredictability of property tax increases. By introducing a framework for equitable, transparent and phased-in valuations, this initiative delivers stability for businesses, ensures accurate tax assessments and provides the state with the resources needed to fund essential services.

One of the standout features of this legislation is its cap on annual increases in property valuations for taxation purposes. For nonresidential properties, the value used to calculate property taxes must reflect its fair market value, as required by the property tax code. However, to prevent sudden and steep tax increases, this legislation ensures that from 2025 to 2037, a property’s taxable value cannot go up by more than 12% per year compared to the previous year.

This gradual approach allows property owners to plan for increases over time, avoiding sudden financial strain. Importantly, the 12% annual increase stops once a property’s assessed value reaches its true, current, and correct market value, ensuring fairness while maintaining the predictability businesses need to thrive.

Beyond predictability, this legislation introduces much-needed equity to the property tax system. It ensures that commercial properties are treated consistently, preventing disparities between new property owners and long-term owners. This creates a level playing field for all participants in the commercial real estate market, fostering a more attractive environment for local businesses and out-of-state investors alike.

Additionally, the bill’s provisions ensure that tax increases are tied to meaningful changes in property use or zoning, protecting business owners from sudden spikes unrelated to market or operational realities. This thoughtful approach strengthens trust between the government and the business community, demonstrating that taxation can be both fair and pragmatic.

The state also stands to benefit significantly from this legislation. By ensuring gradual and predictable increases in property valuations, New Mexico can rely on a steady and sustainable stream of property tax revenues to fund vital public services, including education, public safety and infrastructure.

This proposed legislation also sends a clear message that New Mexico values fairness, transparency and stability in its tax policies. For investors weighing their options, this stability is a crucial factor in choosing where to establish and grow their businesses. By embracing these principles, New Mexico positions itself as a competitive and attractive market for economic development.

This proposal represents what’s possible when stakeholders work together toward a shared goal. The business community’s collaboration with assessors and policymakers has resulted in a solution that balances the needs of all parties. It shows that public-private partnerships can address complex challenges in ways that foster long-term growth and stability for the state.

As this legislation progresses through the legislative process, it’s important to recognize the broader vision it represents. It’s not merely a tax policy; it’s an investment in New Mexico’s future. By protecting businesses from undue burdens and ensuring the state collects its fair share, this initiative lays the foundation for a stronger, more resilient economy.

Let us seize this moment to show that New Mexico is not just open for business but also a leader in creating policies that benefit everyone. This is a win-win solution we can all support.

Nathan Brooks is executive director of the Commercial Association of Realtors New Mexico, also known as CARNM.