Local Economic Development Act (LEDA)

This discretionary grant is administered by NM’s executive branch. As a grant, it does not need to be paid back, however, since funds are awarded after the work is complete, the company must be able to have the money to pay for the expenses, then EDD can reimburse for all or some of them. The business must collateralize this grant for the duration of the contract with EDD. The philosophical underpinnings are that the company gets the reimbursements through the grant money quickly and early in the contract. The company however commits to not only attaining but maintaining certain performance measures. By statute, EDD must “claw back” some percentage of the grant if a company is not able to retain the jobs committed to.

LEDA eligible expenses are those associated with:

• the acquisition of land
• the acquisition or construction of buildings
• infrastructure or tenant improvements
• mortgages
• rent or lease abatements.

Equipment cannot be paid for through LEDA because the anti-donation clause in the New Mexico Constitution does not allow money flow directly from the state to a business. For that reason, EDD uses a fiscal agent to disburse the money. This fiscal agent will be either the city or county of the facility’s physical location.

Pursuing a LEDA grant will take about 90-120 days, from the time of submitting the intake paperwork to the time the fiscal agent has passed an ordinance through its public process consummating the LEDA deal. Only expenses paid after the passing of the LEDA ordinance are eligible for reimbursement through the LEDA.