Capital Outlay

Capital Outlay

In New Mexico, Capital Outlay is authorized by the Legislature and generally is nonrecurring – one-time – money.

Capital Outlay funds are used to build, improve or equip physical property that will be used by the public including but not limited to roads, computers, museums, playgrounds, schools, irrigation ditches, hospitals, lands and furniture.

Upon the conclusion of the legislative session, the Governor of New Mexico has 20 days to either approve or line item veto Capital Outlay projects.

IAD will then immediately notify the tribal entity/organization of the Capital Outlay projects appropriated to their community through an award letter for both Severance Tax Bond and General Fund appropriations. IAD will request a Scope of Work (SOW) suinmission. A SOW must by submitted for each appropriated project(s).

Much of the state’s Capital Outlay is funded through three sources: general obligation bonds, severance tax bonds and nonrecurring general fund revenue. Amounts vary from year to year depending on the economy. Nonrecurring general fund moneys are particularly unpredictable. The state also issues bonds for state transportation projects, projects funded by the New Mexico Finance Authority and other projects and typically those bonds are repaid with other revenue.

NOTE: IAD urges tribal entities to thoroughly assess project readiness. The Bonds are subject to arbitrage (interest charged to the bond). The longer it takes for the tribal entity/organization to spend the money, the more interest the State must pay on the bond. This is money that could be better spent by tribes to fund more projects.

FY26 Capital Outlay Funding Awards

H.B. 450 is a comprehensive capital expenditures bill that authorizes the issuance of severance tax bonds and makes appropriations from various funds to support a wide range of infrastructure, construction and improvement projects across New Mexico.

The bill provides funding for numerous state agencies, educational institutions, local governments, Nations, Pueblos, Tribes and specific infrastructure initiatives.

Key provisions include authorizing the state board of finance to issue severance tax bonds, establishing conditions for the expenditure of bond proceeds and setting guidelines for how appropriated funds can be used. 

Here is the Capital Outlay funding awarded for FY26 categorized by the Agency who will adminsiter the funds.

For more breakdowns and information on H.B. 450, please click here.