NMSA 1978, § 7-36-29 — 7-36-29

Special method of valuation; property used for the
generation, transmission or distribution of electric power or
energy.

# A.

All property used for the generation, transmission or distribution of electric power
or energy subject to valuation for property taxation purposes shall be valued in
accordance with the provisions of this section.

# B.

As used in this section:
(1) "depreciation" means straight line depreciation over the useful life of the
item of property;
(2) "electric plant" means all property situated in this state used or useful for
the generation, transmission or distribution of electric power or energy, but does not
include land, land rights, general buildings and improvements, construction work in
progress, materials and supplies and licensed vehicles;
(3) "construction work in progress" means the total of the balances of work
orders for an electric plant in process of construction on the last day of the preceding
calendar year exclusive of land, land rights and licensed vehicles;
(4) "general buildings and improvements" means buildings of the nature of
offices, residential housing, warehouses, shops and associated improvements in
general use by the taxpayer and not directly associated with generation, transmission or
distribution of electric power or energy;
(5) "materials and supplies" means the cost, including sales, use and excise
taxes, and transportation costs to point of delivery in this state, less purchases and
trade discounts, of all unapplied material and supplies on hand in this state as of
December 31 of the preceding calendar year; and
(6) "tangible property cost" means the actual cost of acquisition or
construction of property, including additions, retirements, adjustments and transfers, but
without deduction of related accumulated provision for depreciation, amortization or
other purposes; "tangible property cost" excludes the cost of property contributed to, or
acquired with funds contributed to, a utility by or on behalf of a ratepayer or potential
ratepayer for the expansion, improvement or replacement of property used for the
transmission or distribution of electric power of the utility.

# C.

An electric plant shall be valued as follows:
(1) the department shall determine the tangible property cost of the electric
plant;
(2) such tangible property cost shall then be reduced by the related
accumulated provision for depreciation and any other justifiable factors, including
functional and economic obsolescence, such as the limitation on the use of the property
based on the available reserves committed to the property; and
(3) notwithstanding the foregoing determination of value for property taxation
purposes, the value for property taxation purposes of an electric plant shall not be less
than twenty percent of the tangible property cost of the electric plant.

# D.

The value of construction work in progress shall be fifty percent of the amount
expended and entered upon the accounting records of the taxpayer as of December 31
of the preceding calendar year as construction work in progress.

# E.

The value of materials and supplies shall be the tangible property cost for such
property as of December 31 of the preceding calendar year.

# F.

Each item of property having a taxable situs in the state and valued under this
section shall have its net taxable value allocated to the governmental units in which the
property is located.

# G.

The department shall adopt regulations under Section 7-38-88 NMSA 1978
[repealed] to implement the provisions of this section.