BUSINESS INCENTIVES
New Mexico offers a number of competitive incentive programs to help position your company for growth.
INCENTIVES OVERVIEW
The Albuquerque metro area and the State of New Mexico offer aggressive business incentives to help reduce your overall cost of doing business. From corporate income tax rates to workforce training, we offer excellent programs with a business friendly attitude. AREA is eager to provide assistance specific to your company’s location or expansion needs, in complete confidence. Our team of economic development professionals is organized to help you obtain the facts you need to thoroughly evaluate the Albuquerque metro area. We can save you countless hours of research and analysis by providing a full complement of services, all at no cost or obligation to you.
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MAJOR INCENTIVES
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INDUSTRY FOCUSED INCENTIVES
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PROGRAMS AND ASSETS
MAJOR INCENTIVES
INDUSTRIAL REVENUE BOND (IRB)
Significant real and personal property tax abatement and compensating tax and gross receipts tax exemptions can occur through the use of an Industrial Revenue Bond (IRB). An IRB is a loan from the bond purchaser to a company where the loan proceeds and repayment flows through a governmental issuer.
JOB TRAINING INCENTIVE PROGRAM (JTIP)
The New Mexico Job Training Incentive Program is a highly flexible state program that provides on-the-job training. Customized training may be provided by post-secondary educational institutions, company trainers, or outside trainers.
WORKFORCE INNOVATION & OPPORTUNITY ACT (WIOA)
The Workforce Innovation & Opportunity Act (WIOA) is a federal program that provides a financial incentive to employers for hiring individuals and training existing employees. The WIOA program is administered through New Mexico Workforce Connection.
HIGH WAGE JOBS TAX CREDIT (HWJTC)
The High Wage Jobs Tax Credit provides businesses with a tax credit equal to 8.5 percent of the value of salaries for each net new job paying a net taxable wage of at least $60,000 per year in communities with a population of 60,000 or more.
MANUFACTURING INVESTMENT TAX CREDIT
New Mexico tax law provides for a credit equal to 4.875 percent of the value of qualified equipment and other property used directly and exclusively in a manufacturing operation. The credit can be applied against compensating tax, gross receipts tax and withholding tax.
TECHNOLOGY JOBS AND R&D TAX CREDIT
Qualified New Mexico facilities may take a credit equal to 5 percent (10 percent in rural areas) of qualified research expenditures related to payroll, land, buildings, equipment, computer software and upgrades, consultants and contractors performing work in New Mexico, technical books, manuals and test materials.
LOCAL ECONOMIC DEVELOPMENT ACT (LEDA)
The New Mexico Local Economic Development Act (LEDA) established a process for local governments to provide financial resources, or a “deal-closing fund,” for the attraction and support of new or growing eligible private-sector, economic-base business “projects” that can demonstrate additional funding is needed to close a competitive cost gap or make the project financially viable. View past program awards and details here.
INDUSTRY FOCUSED INCENTIVES
AIRCRAFT MANUFACTURING AND MAINTENANCE SERVICES TAX DEDUCTION
Receipts of an aircraft manufacturer or affiliate from selling aircraft or aircraft parts; services performed on aircraft or aircraft components; and aircraft flight support, pilot training or maintenance training services, may be deducted from gross receipts.
DIRECTED ENERGY SYSTEMS GROSS RECEIPTS TAX DEDUCTION
Contractors, other than a national laboratory, that provide qualified research and development services for directed energy and satellite-related inputs to the United States department of defense, may deduct their receipts derived from such inputs and services.
SOLAR GROSS RECEIPTS TAX DEDUCTION
The Solar Gross Receipts Tax Deduction is available for vendors who sell or install solar energy systems that provide hot water, electricity, or space heat to the property on which it is installed may be deducted from gross receipts before the tax is calculated.
PROPERTY TAX EXEMPTION FOR SOLAR SYSTEMS
Roof-top scale solar energy system installations are exempt from property tax assessments at the time the system is installed. The solar system improvements would not be assessed property taxes until the property is sold.
PROGRAMS AND ASSETS
OUT-OF-STATE TUITION WAIVER AND LOTTERY FUNDED SCHOLARSHIPS
Receipts of an aircraft manufacturer or affiliate from selling aircraft or aircraft parts; services performed on aircraft or aircraft components; and aircraft flight support, pilot training or maintenance training services, may be deducted from gross receipts.
ACCESS TO LOCAL AND STATE GOVERNMENT
This type of “incentive” is difficult to place a value on. However, many New Mexico companies explain that access to the governor of New Mexico and the Legislature is common and very valuable. This extends to local government as well as to the state’s congressional delegation.
FINANCING & REDEVELOPMENT TOOLS
OPPORTUNITY ENTERPRISE REVOLVING FUND (OERF)
In 2022, the Opportunity Enterprise Revolving Fund was created by the NM Legislature to provide financing for new or existing commercial facilities to attract businesses to New Mexico and allow existing businesses to expand operations. The $70 million loan fund offers up to $17.5 million per project to finance projects that will build, purchase, or lease buildings, and to maintain and improve existing buildings. Loan funds may be used for purchasing, planning, designing, building, surveying, improving, operating, furnishing, equipping or maintaining land, buildings or infrastructure.
ALBUQUERQUE MRA - TAX INCREMENT FUNDING
In 2022, New Mexico signed Senate Bill 251 into law, which amends the state statute to allow local jurisdictions to collect up to 75% of the incremental city, county, and state property and gross revenue taxes for an entire Metropolitan Redevelopment Area (MRA) for up to 20 years, subject to the state and county’s approval. This funding can be spent on public infrastructure, catalytic redevelopment and affordable housing that will help expand development and investment within the MRA. Learn more on the City of Albuquerque Tax Increment Financing webpage.