New Mexico Anti-Donation Law
(Article IX, Section 14 of the State of New Mexico Constitution)
In general, the New Mexico Anti-Donation Law prohibits the University from "spending," “giving away” or “allowing free use of” University resources to benefit other organizations or individuals. University resources can consist of University-owned financial assets (Cash), University-owned Property (Supplies/Equipment/Furniture, etc) University-provided services or University employee paid work time.
- Applies to everything the University owns (money or property), or services it provides.
- Most commonly applies to unallowable, non-business use of University funds or Property (i.e Personal Benefit)
- MUCH BROADER than just “donations to charity“
Specific Language from the New Mexico Anti-Donation Law:
“Neither the state, nor any county, school district, or municipality ... shall directly or indirectly lend or pledge its credit, or make any donation to or in aid of any person, association, or public or private corporation ....”
Donations vs. Exchange Transactions
In general with regards to the New Mexico Anti-Donation Law, Donations/Non-Exchange Transactions are prohibited, but Exchange Transactions are allowable.
- Donation (Non-Exchange Transaction) – One Party receives something of value from the University without directly giving value back in exchange – PROHIBITED.
Example: A University Department wants to make a donation to an organization to support the organization’s hosting of an event – Donation/Non-Exchange Transaction, PROHIBITED by Anti-Donation Law.
- Exchange Transaction – Each party receives or sacrifices something of approximate equal value – NOT A DONATION - ALLOWABLE.
Example: The University pays an organization that is hosting an event a fee and receives back at least approximate fair value in exchange. Fair Value could be in the form of a Booth Rental, Advertising, Conference Admission, etc – EXCHANGE TRANSACTION - ALLOWABLE
Prohibited by the New Mexico Anti-Donation Law – Other General Examples:
Prohibited Uses of University Funds:
- Gifts (Congratulatory, Farewell, Sympathy, Bereavement, Retirement, etc)
- Expenses without a clear University business connection
- Personal Entertainment expenses (i.e. Golf, Tickets to Concerts/Sporting events, recreation, etc)
- Holiday Parties, Retirement Parties, Holiday Decorations, etc
- Donations whether to individuals, organizations or charities - even if they might appear to support a University Department’s mission
- Fundraising Expenses - Meals, gifts to donors or potential donors (The UNM Foundation can pay for these, but the University cannot).
- Home Office Expenses – Purchasing furniture, equipment, headphones for an employee to keep as their own personal property.
- Important distinction – UNM can issue work equipment/supplies to an employee (computer, headphones, etc), but the University owns these items. The employee must return these items upon end of employment.
- General Rule - IF UNM Buys it, UNM Owns it.
- Fines and Penalties - Fines and other penalties incurred by an employee in violation of public policy. ex parking and traffic fines
- Repairs and maintenance to equipment or facilities NOT owned by the University
- (ex Repair to Employee/Student owned laptop or vehicle, etc, even if used at times for UNM Business).
- Purchases of supplies for equipment NOT owned by the University (Battery or Case for Employee/Student-owned Phone/Laptop, etc).
- Travel Expenses for Spouse, family members or other individuals accompanying a University employee on Official Business.
- Forgiveness of debts owed to the University
- Employee bonuses (unless specifically included in an employment contract)
Prohibited Uses of University Property
- Giving away University Property (supplies/furniture/equipment, etc) to individuals or other organizations.
- Using a University-owned vehicle or other equipment for non-UNM Business use (personal use, use of another organization, etc)
Other Examples Prohibited by the Anti-Donation Law
- Allowing free use of University facilities (i.e SUB Ballrooms, Meeting Rooms, Athletic & Entertainment venues, Laboratories, etc) to individuals or organizations
- Allowing free use of University Resources (Personnel, financial systems, etc) ex - to act as an unpaid Fiscal Agent for another organization
Other General Info - Anti-Donation Clause of New Mexico Constitution (Art.IX, Sec. 14)
(Sec. 14. [Aid to private enterprise; veterans' scholarship program; student loans; job opportunities.])
Neither the state nor any county, school district or municipality, except as otherwise provided in this constitution, shall directly or indirectly lend or pledge its credit or make any donation to or in aid of any person, association or public or private corporation or in aid of any private enterprise for the construction of any railroad; provided:
- nothing in this section shall be construed to prohibit the state or any county or municipality from making provision for the care and maintenance of sick and indigent persons;
- nothing in this section shall prohibit the state from establishing a veterans' scholarship program for Vietnam conflict veterans who are post-secondary students at educational institutions under the exclusive control of the state by exempting such veterans from the payment of tuition. For the purposes of this subsection, a "Vietnam conflict veteran" is any person who has been honorably discharged from the armed forces of the United States, who was a resident of New Mexico at the original time of entry into the armed forces from New Mexico and who has been awarded a Vietnam campaign medal for service in the armed forces of this country in Vietnam during the period from August 5, 1964 to the official termination date of the Vietnam conflict as designated by executive order of the president of the United States;
- the state may also establish by law a program of loans to students of the healing arts, as defined by law, for residents of the state who, in return for the payment of educational expenses, contract with the state to practice their profession for a period of years after graduation within areas of the state designated by law; and
- nothing in this section shall be construed to prohibit the state or a county or municipality from creating new job opportunities by providing land, buildings or infrastructure for facilities to support new or expanding businesses if this assistance is granted pursuant to general implementing legislation that is approved by a majority vote of those elected to each house of the legislature. The implementing legislation shall include adequate safeguards to protect public money or other resources used for the purposes authorized in this subsection. The implementing legislation shall further provide that:
(1) each specific county or municipal project providing assistance pursuant to this subsection need not be approved by the legislature but shall be approved by the county or municipality pursuant to procedures provided in the implementing legislation; and
(2) each specific state project providing assistance pursuant to this subsection shall be approved by law. (As amended November 1, 1971, November 5, 1974, and November 8, 1994.)
Relevant AG opinions:
Providing dormitory and meals to Boy Scouts. - The Department of Public Safety cannot provide use of its dormitory and meals to a Boy Scouts of America troop at a substantially reduced cost. 1990 Op. Att'y Gen. No. 90-13.
No contributions to American Legion memorial allowed. - County commissioners may not contribute $500 to an American Legion war memorial which is erected upon the county courthouse grounds. 1943-44 Op. Att'y Gen. No. 4422.
Nor to community chest. - It is not legal for the state fair to donate the proceeds, in excess of costs, from horse races to the community chest. 1955-56 Op. Att'y Gen. No. 6279.
Nor to chamber of commerce. - A city cannot make donations to the chamber of commerce and include such contributions in the city budget. 1943-44 Op. Att'y Gen. No. 4368.
As well as contributions to scouts or salvation army. - Municipality may not contribute or spend any money of fund to or for the girl scouts, boy scouts or the salvation army if the contribution is to those organizations in their private capacities. 1955-56 Op. Att'y Gen. No. 6253.
Even though their efforts come within spirit of statute. - Such groups as the 4-H, boy scouts and girl scouts conduct juvenile recreation programs that come within the spirit of 7-12-15 NMSA 1978. But the framers of the constitution have clearly provided that public funds shall not be donated to private persons or associations, and it is the court's opinion that the juvenile recreation fund cannot be expended by, or on behalf of, a 4-H club. 1961-62 Op. Att'y Gen. No. 61-2.
Yet municipality may not fund specially created nonprofit corporation. - City or county may not appropriate public funds for economic development to be used by nonprofit corporation formed for this purpose. 1967 Op. Att'y Gen. No. 67-29.