Committee adopts substitute on gross‑receipts tax relief for wildfire victims, rolls bill to Thursday for clarifying amendments

A House committee on [date not specified] adopted a committee substitute for House Bill 568 that would provide gross‑receipts tax relief tied to rebuilding homes destroyed by wildfires and would extend a tax benefit related to legal services used by wildfire claimants, then agreed to roll the bill to Thursday for further clarifying amendments.

The substitute, offered by Representative Borrego and introduced in committee discussion as addressing both site‑built homes and gross‑receipts‑tax (GRT) paid on legal services, was adopted on a motion by Representative Gonzales and seconded by Representative Mason. Committee members asked staff and bill proponents to clarify whether the credit applies to modular or mobile homes, whether it should be statewide or limited to specific named fires, and whether the credit should be limited to GRT paid on legal services rather than the full cost of legal services.

"This is an important bill for victims of wildfires," Representative Borrego said in committee, describing the loss of longtime generational homes in fires including the Hermits Peak‑Calf Canyon incident and saying the substitute aims to let families rebuild homes that will stand for another hundred years. The substitute expanded the original bill — which proponents said initially addressed legal fees only — to add a credit for site‑built homes destroyed in calendar years 2021 through 2023 and to address GRT on legal services.

Registered lobbyist Kent Cravens of the New Mexico Association of Realtors testified in favor of the substitute, saying, "We're very much in support of this and other kinds of bills that are moving through this session." Attorney Dionza Valencia, who represents clients harmed in the Hermits Peak‑Calf Canyon fires, said the measure was a "critical step" to help communities recover.

Committee members raised three recurring concerns: whether the credit should cover modular or mobile homes (several members asked whether "mobile home" or "trailer" placements would qualify under the substitute); whether the bill should be restored to a statewide scope rather than limited to specific fires; and whether the tax relief should be explicitly limited to the GRT on legal services rather than the full legal fee amount. Representative Gonzales said clarifying language could be added on page 2 to read "cost of gross receipts tax paid on legal services" to limit the credit specifically to GRT on legal services.

Members also discussed the prior session's version of the tax credit, which had a $5,000,000 statewide cap. Proponents said that cap created an unequal outcome in which claimants who received settlements earlier in the year could take the credit while later claimants could not; the substitute removes that cap as drafted in committee. Several members suggested adding a sunset date or other limits while others objected to reintroducing a cap.

After adopting the substitute, the committee recorded a subsequent motion related to committee disposition language and then agreed to roll the bill to Thursday so proponents could return with the clarified text and any committee amendments. Committee staff and proponents said they expected to refine the definitions (including the definition of qualifying "site built" homes and the scope of eligible fires) before the bill goes to the next committee, Appropriations.

Votes at the committee on the substitute: the committee adopted the committee substitute on a motion by Representative Gonzales, seconded by Representative Mason. The committee later held further disposition motion discussion and rolled the bill to Thursday; no final floor referral or enactment occurred in this hearing.

The bill now moves to Appropriations with proponents expecting technical clarifications on the credit language and possible additions such as a sunset or a clearer statement that the credit applies to the GRT paid on legal services.