Development Tools/Incentives

For additional information or questions, please contact the City Manager's Office, (505) 891-5002.

Gross Receipts Investment Policy (GRIP)

A developer/retailer pays for the cost of public infrastructure improvements (roads, drainage, water and wastewater lines, etc.) for a project, and in return the city refunds a percentage of the yearly applicable gross receipts tax revenues it receives that are directly attributed to the retail sales of the project/business back to the developer up to a maximum number of years; or the city may reimburse impact fees where the reimbursement thereof is instrumental in bringing the retail or targeted commercial businesses to the city.

Requires Rio Rancho Governing Body approval to be enacted.

Tax Increment Development District (TIDD)

A TIDD issues bonds to finance public infrastructure improvements (streets, water, wastewater, drainage). The TIDD bonds are secured by a dedication of certain municipal, county, and/or state-shared gross receipts tax that are generated in the TIDD. The length of time and amount of gross receipts tax dedication that occurs varies by individual TIDDs.

Requires Rio Rancho Governing Body approval to be enacted.

Public Improvement District (PID)

A PID provides financing based on levying property taxes on land within a PID, imposing special levies based on benefit to property, front footage, acreage, cost of improvements (or other factors apart from assessed valuation), or by providing for use charges of improvements or revenue-producing projects or facilities. PID taxes, levies and charges may be pledged to pay debt service on bonds issued by a PID. PID bonds are obligations solely of the PID issuing the bonds.

PIDs are authorized to finance various infrastructure and improvements (water and sewer systems, streets, gas and telecommunications systems, parks, public buildings, libraries, school facilities, equipment) and related costs of operation and administration.

Requires Rio Rancho Governing Body approval to be enacted.

Industrial Revenue Bond (IRB)

An IRB is an obligation of a city or county (the issuing entity) that is payable solely from revenues received from an underlying lease or installment sale arrangement with a company that uses the facility financed by the bonds.

IRBs enable local governments to provide a mechanism for low-cost financing and other incentives (property tax exemption and gross receipts tax exemption for equipment purchased for facility) for private parties to create facilities that enhance employment in the locality.

The form of the transaction puts the legal title to the project in the name of the issuing entity. The issuing entity then typically leases the project to the actual user, and it's the lease payments or purchase price payments that are used to pay off the interest and principal on the bonds.

Requires Rio Rancho Governing Body approval to be enacted.

Local Economic Development Act (LEDA)

Per the New Mexico constitution, local or regional governments - to create new job opportunities - can provide land, buildings or infrastructure for facilities to support new or expanding businesses.

The city of Rio Rancho adopted by ordinance an economic development plan outlining its economic development goals and strategies.

A qualifying business may submit a project application for consideration that is in compliance with the city's plan. Once the city has done its due diligence in reviewing the application, the project agreement can be sent to the Governing Body for consideration.

The participation agreement sets out the contributions to be made by each party, the security provided to the local government by the qualifying entity, a schedule for project development and completion, and provisions for performance review and actions for unsatisfactory performance.

Requires Governing Body approval to be enacted.

Infrastructure Development Zone (IDZ)

Legislation was passed by the New Mexico Legislature and signed into law by the governor in 2009 regarding the ability to create Infrastructure Development Zones.

This legislation creates a mechanism for infrastructure development which requires that the development pays for itself. Improvements are paid for by the property owners who receive the benefit of the improvements.

A service plan, which is developed through public meetings with either a city council or county commission giving final approval, is required and dictates how every facet of development will occur. The developer may sell bonds for the development in question, but is limited to no more than the project will support. Public bonds are sold on the open market and any developer for any sized development can use this tool.

An IDZ requires that infrastructure is completed and ready to transfer to local government at no cost to them while using specifications established by local government.

Requires Rio Rancho Governing Body approval to be enacted.

For more information, please visit the New Mexico Legislature website.

Additional Information

Please be advised that applications, fees, extensive review, and other requirements apply to each of these programs. For more information or questions, please contact the City Manager's office by telephone at (505) 891-5002.

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