N.M. Stat. § 13-1-21 (2026)

A. For the purposes of this section:

        (1)    "business" means a commercial enterprise carried on for the purpose of
selling goods or services, including growing, producing, processing or distributing
agricultural products;

       (2)    "formal bid process" means a competitive bid process;

      (3)     "formal request for proposals process" means a competitive proposal
process, including a competitive qualifications-based proposal process;

       (4)   "Native American resident business" means a business that has a valid
Native American resident business certificate issued by the taxation and revenue
department pursuant to Section 13-1-22 NMSA 1978 but does not include a Native
American resident veteran business;

       (5)    "Native American resident veteran business" means a business that has a
valid Native American resident veteran business certificate issued by the taxation and
revenue department pursuant to Section 13-1-22 NMSA 1978;

        (6)     "public body" means a department, commission, council, board,
committee, institution, legislative body, agency, government corporation, educational
institution or official of the executive, legislative or judicial branch of the government of
the state or a political subdivision of the state and the agencies, instrumentalities and
institutions thereof, including two-year post-secondary educational institutions, school
districts, local school boards and all municipalities, including home-rule municipalities;
       (7)    "recycled content goods" means supplies and materials composed twenty-
five percent or more of recycled materials; provided that the recycled materials content
meets or exceeds the minimum content standards required by bid specifications;

        (8)    "resident business" means a business that has a valid resident business
certificate issued by the taxation and revenue department pursuant to Section 13-1-22
NMSA 1978 but does not include a resident veteran business; and

      (9)    "resident veteran business" means a business that has a valid resident
veteran business certificate issued by the taxation and revenue department pursuant to
Section 13-1-22 NMSA 1978.

   B. Except as provided in Subsection C of this section, when a public body makes a
purchase using a formal bid process, the public body shall deem a bid submitted by a:

      (1)    resident business or Native American resident business to be eight
percent lower than the bid actually submitted; or

       (2)    resident veteran business or Native American resident veteran business
with annual gross revenues of up to six million dollars ($6,000,000) in the preceding tax
year to be ten percent lower than the bid actually submitted.

   C. When a public body makes a purchase using a formal bid process and the bids
are received for both recycled content goods and nonrecycled content goods, the public
body shall deem:

      (1)     bids submitted for recycled content goods from any business, except a
resident veteran business or Native American resident veteran business, to be eight
percent lower than the bids actually submitted; or

       (2)      bids submitted for recycled content goods from a resident veteran
business or Native American resident veteran business with annual gross revenues of
up to six million dollars ($6,000,000) in the preceding tax year to be ten percent lower
than the bids actually submitted.

   D. When a public body makes a purchase using a formal request for proposals
process, not including contracts awarded on a point-based system, the public body shall
award an additional:

      (1)    eight percent of the total weight of all the factors used in evaluating the
proposals to a resident business or Native American resident business; and

       (2)   ten percent of the total weight of all the factors used in evaluating the
proposals to a resident veteran business or Native American resident veteran business
that has annual gross revenues of up to six million dollars ($6,000,000) in the preceding
tax year.
   E. When a public body makes a purchase using a formal request for proposals
process, and the contract is awarded based on a point-based system, the public body
shall award additional points equivalent to:

      (1)   eight percent of the total possible points to a resident business or Native
American resident business; or

        (2)    ten percent of the total possible points to a resident veteran business or
Native American resident veteran business that has annual gross revenues of up to six
million dollars ($6,000,000) in the preceding tax year.

    F. When a joint bid or joint proposal is submitted by a combination of resident
veteran, Native American resident veteran, resident, Native American resident or
nonresident businesses, the preference provided pursuant to Subsection B, C, D or E of
this section shall be calculated in proportion to the percentage of the contract, based on
the dollar amount of the goods or services provided under the contract, that will be
performed by each business as specified in the joint bid or proposal.

   G. A person shall not benefit from the provisions of this section based on more than
one business concurrently.

   H. A public body shall not award a business both a resident business preference
and a resident veteran business preference or a Native American resident business
preference and a Native American resident veteran business preference.

    I. The procedures provided in Sections 13-1-172 through 13-1-183 NMSA 1978 or
in an applicable purchasing ordinance apply to a protest to a public body concerning the
awarding of a contract in violation of this section.

   J. This section shall not apply when the expenditure includes federal funds for a
specific purchase.

History: 1978 Comp., § 13-1-21, enacted by Laws 1979, ch. 72, § 1; 1981, ch. 104, § 1;
1988, ch. 84, § 1; 1989, ch. 310, § 1; 1995, ch. 60, § 1; 1997, ch. 1, § 2; 1997, ch. 2, §
2; 1997, ch. 3, § 1; 2000, ch. 41, § 1; 2011 (1st S.S.), ch. 3, § 1; 2012, ch. 56, § 1; 2012,
ch. 56, § 2; 2016, ch. 5, § 1; 2022, ch. 6, § 1.

                                     ANNOTATIONS

Repeals. — Laws 2016, ch. 5, § 4, effective July 1, 2016, repealed Laws 2012, ch. 56,
§ 2, which was to become effective July 1, 2022. For provisions of former section, see
the 2015 NMSA 1978 on NMOneSource.com.

The 2022 amendment, effective July 1, 2022, defined "Native American resident
business" and Native American resident veteran business" for purposes of this section,
increased the preference for New Mexico resident businesses, increased the maximum
allowable gross revenue for resident veteran businesses to qualify for certain
preferences, amended existing provisions giving a preference to resident businesses
and resident veteran businesses to include Native American resident businesses and
Native American resident veteran businesses, and removed a provision that prohibited
a business from claiming a preference for more than ten consecutive years; in
Subsection A, added new Paragraphs A(4) and A(5) and redesignated former
Paragraphs A(4) through A(7) as Paragraphs A(6) through A(9), respectively; in
Subsection B, Paragraph B(1), after "resident business", added "or Native American
resident business", after "to be", deleted "five" and added "eight", and in Paragraph
B(2), after "resident veteran business", added "or Native American resident veteran
business", after "gross revenues of up to", deleted "three million dollars ($3,000,000)"
and added "six million dollars ($6,000,000)"; in Subsection C, Paragraph C(1), after
"resident veteran business", added "or Native American resident veteran business", and
after "to be", deleted "five" and added "eight", and in Paragraph C(2), after "resident
veteran business", added "or Native American resident veteran business", after "gross
revenues of up to", deleted "three million dollars ($3,000,000)" and added "six million
dollars ($6,000,000)"; in Subsection D, Paragraph D(1), deleted "five" and added
"eight", and after "resident business", added "or Native American resident business",
and in Paragraph D(2), after "resident veteran business", added "or Native American
resident veteran business", and after "gross revenues of up to", deleted "three million
dollars ($3,000,000)" and added "six million dollars ($6,000,000)"; in Subsection E,
Paragraph E(1), deleted "five" and added "eight", and after "resident business", added
"or Native American resident business", and in Paragraph E(2), after "resident veteran
business", added "or Native American resident veteran business", and after "gross
revenues of up to", deleted "three million dollars ($3,000,000)" and added "six million
dollars ($6,000,000)"; in Subsection F, after "resident veteran", added "Native American
resident veteran", and after the next occurrence of "resident", added "Native American
resident"; in Subsection G, deleted "A resident veteran business shall not benefit from
the preference pursuant to this section for more than ten consecutive years. A person
that is an owner of a business that is a resident veteran business shall not benefit from
the preference pursuant to this section for more than ten consecutive years"; and in
Subsection H, after "resident veteran business preference", added "or a Native
American resident business preference and a Native American resident veteran
business preference".

The 2016 amendment, effective July 1, 2016, reduced the maximum revenue that a
resident veteran business can earn to receive the veteran business preference, merged
the former tiered preferences into one ten percent preference, set a ten consecutive
year maximum time for a vendor to use the resident veteran preference, and limited the
benefit to one business concurrently; in Subsection A, Paragraph (3), after each
occurrence of "competitive", deleted "sealed"; in Subsection B, Paragraph (1), after the
semicolon, added "or", in Paragraph (2), after "annual", added "gross", after "revenues
of", deleted "one million dollars ($1,000,000) or less" and added "up to three million
dollars ($3,000,000) in the preceding tax year", and deleted Paragraphs (3) and (4)
which provided for a tiered veteran business preference; in Subsection C, Paragraph
(1), after the semicolon, added "or", in Paragraph (2), after "annual", added "gross", and
after "revenues of", deleted "one million dollars ($1,000,000) or less" and added "up to
three million dollars ($3,000,000) in the preceding tax year", and deleted Paragraphs (3)
and (4) which provided for a tiered veteran business preference; in Subsection D,
Paragraph (1), after "business", added "and", in Paragraph (2), after "annual", added
"gross", and after "revenues of", deleted "one million dollars ($1,000,000) or less" and
added "up to three million dollars ($3,000,000) in the preceding tax year", and deleted
Paragraphs (3) and (4) which provided for a tiered veteran business preference; in
Subsection E, in the introductory sentence, after "award", deleted "an", after
"additional", deleted "of the" and added "points", and after "equivalent", deleted "of" and
added "to", in Paragraph (1), after the semicolon, added "or", in Paragraph (2), after
"annual", added "gross", and after "revenues of", deleted "one million dollars
($1,000,000) or less" and added "up to three million dollars ($3,000,000) in the
preceding tax year", and deleted Paragraphs (3) and (4), which provided for a tiered
veteran business preference; deleted former Subsection G, which limited the former
tiered veteran business preferences to an aggregate of ten million dollars ($10,000,000)
in purchases by public bodies from all resident veteran businesses receiving
preferences; and added a new Subsection G.

The 2012 amendment, effective July 1, 2012, alphabetized terms; gave resident
veteran businesses a preference; limited the preference in any calendar year to an
aggregate of ten million dollars in purchases by public bodies from all resident veteran
businesses receiving preferences; in Subsection A, added Paragraph (5) and deleted
former Paragraph (6) to alphabetize the definition of "recycled content goods", in
Paragraph (6), after "Section 13-1-22 NMSA 1978", added the remainder of the
sentence, and added Paragraph (7); in Subsection B, in the introductory sentence,
added "Except as provided in Subsection C of this section", and added Paragraphs (3)
through (4); added Subsection C; in Subsection D, after "request for proposals
process", added the remainder of the sentence, in Paragraph (1), after "evaluating the
proposals", deleted "shall be awarded" and after "resident business", deleted "based on
the resident business possessing a valid resident business certificate; or", and added
Paragraphs (2) through (4); in Subsection E, in the introductory sentence, added "When
a public body makes a purchase using a formal request for proposals process" and after
"point-based system", added the remainder of the sentence, in Paragraph (1), at the
beginning of the sentence, deleted "a resident business shall be awarded the equivalent
of", after "total possible points to", deleted "be awarded based on the" and added "a",
and after "resident business", deleted "possessing a valid resident business certificate",
and added Paragraphs (2) through (4); in Subsection F, after "proposal is submitted by",
deleted "both resident and" and added "a combination of resident veteran, resident or",
after "nonresident businesses, the", deleted "resident business", after "Subsection B,
C", added "D or E", after "this section shall be", deleted "reduced" and added
"calculated", and after "will be performed by", deleted "a nonresident" and added "each";
deleted former Subsection E, which provided a five percent preference for recycled
content goods of equal quality when bids were received for the recycled content goods
and nonrecycled content goods; and added Subsections G and H.
The 2011 (1st. S.S.) amendment, effective October 5, 2011, provided a five percent
advantage to bids and proposals by resident businesses and to recycled content goods;
specified the minimum percentage of recycled materials in recycled content goods;
eliminated the practice of brokering the preference through joint bids or proposals by
resident and non-resident businesses by reducing the preference by the percentage of
the contract performed by the nonresident business; eliminated the preference for
resident manufacturers and New York state business enterprises; expanded the
application of the resident business preference to contracts larger than $5,000,000;
provided the procedure for protesting violations of this section; deleted former
Paragraphs (2) through (4) and (6) of Subsection A, which defined "New Mexico
resident business", "New York state business enterprise", "resident manufacturer", and
"virgin content goods"; added Paragraphs (1) through (4) of Subsection A; in Paragraph
(5) of Subsection A, after "means a", deleted "New Mexico resident business or a New
York state business enterprise" and added the remainder of the sentence; in Paragraph
(6) of Subsection A, after "materials composed", deleted "in whole or in part" and added
"twenty-five percent or more"; deleted former Subsections B through J,which provided
rules for awarding contracts for goods and services when the bid from a resident
business or resident manufacturer or for virgin content goods and recycled goods is
made lower, by the application of the five percent preference, than the lowest bid from
other bidders; added new Subsections B through F; in Subsection G, after "when the
expenditure", deleted "of" and added "includes", after the phrase "federal funds",
deleted "designated", and at the end of the sentence, deleted "is involved or for any bid
price greater than five million dollars ($5,000,000)"; and deleted former Subsection L,
which exempted the purchase of buses from resident manufacturers and resident
businesses that manufactures buses in New Mexico.

The 2000 amendment, effective March 6, 2000, added Subsection L.

The 1997 amendment, January 24, 1997, in Subsection A, inserted "a New Mexico
resident business or a New York state business enterprise;" in Paragraph (1);
designated Paragraph (2), adding "'New Mexico resident business' means" at the
beginning; added Paragraph (3), redesignating former Paragraphs (2) through (5) as
Paragraphs (4) through (6), and added the proviso at the end of Paragraph (4).

The 1995 amendment, effective June 16, 1995, substituted "a business that" for "one
which" in Paragraph (1) in Subsection A, added Paragraphs (3) and (4) in Subsection A,
added Subsections G through J, and redesignated former Subsection G as Subsection
K.

Policy. — The underlying policy of this section is to give a preference to those persons
and companies who contribute to the economy of the state of New Mexico by
maintaining plants and other facilities within the state and giving employment to
residents of the state. 1969 Op. Att'y Gen. No. 69-42.

Multiple preference policy. — A bidder who offers materials grown, processed or
manufactured in this state may not claim both the manufacturer's 5% preference and
the resident dealer's 5% preference against an out-of-state supplier, giving the in-state
supplier a 10% preference. 1968 Op. Att'y Gen. No. 68-42.

A local vendor preference not disclosed in a request for proposals violates the
Procurement Code. — The Procurement Code requires a government agency to give
a preference to a resident business, 13-1-21(D) NMSA 1978, but if a public body, during
a request for proposals process, awards a contract to a lower-ranked offeror based on a
local vendor preference that was not disclosed in the request for proposals, the decision
would violate the Procurement Code, because in evaluating responsive proposals, a
public body is required to apply the factors listed in the request for proposals and no
others. 2020 Op. Ethics Comm'n No. 2020-04.

Am. Jur. 2d, A.L.R. and C.J.S. references. — 64 Am. Jur. 2d Public Works and
Contracts §§ 52, 54, 67, 69.

Constitutionality of enactment or regulation forbidding or restricting employment of
aliens in public employment or on public works, 38 A.L.R.3d 1213.

Validity, construction, and effect of requirement under state statute or local ordinance
giving local or locally qualified contractors a percentage preference in determining
lowest bid, 89 A.L.R.4th 587.

72 Supp. C.J.S. Public Contracts §§ 7 to 9, 16.