Housing Matters at the State Capitol

Housing Matters By Alexandra Goldman, THP’s monthly column originally appearing in the Taos News.

This year’s regular session of the New Mexico Legislature began Jan. 20, and this short, 30-day session is packed with housing bills that could make a difference.

The state has a key role to play in addressing our housing crisis here in Taos. Much of the funding needed to create and sustain affordable housing is delegated at the state level. State and federal funding sources are distributed via state government departments or the quasi-governmental organization, Housing New Mexico. Beyond funding and appropriations, the state Legislature can also create policy that eases the way for housing to be built and helps shift the narrative across New Mexico around housing.

There are almost two dozen bills related to housing proposed for the 2026 legislative session, but here I’ll just focus on a few that have the opportunity to really impact Taos.

While many people are not excited by tax law, it’s a key policy arena for affordable housing. This session, Senate Bill 92 would reform gross receipts state tax law to significantly reduce the cost of developing affordable rental housing, leading to more units built or deeper levels of affordability.

To back up a little, unlike many states, New Mexico’s gross receipts tax applies to housing construction and materials. Any taxes can make it more expensive and difficult for a project to pencil. Under the current system, to make a project feasible a developer might have to hustle to secure funds in housing subsidy from the state government to cover their gross receipts taxes, which they then have to turn around and pay back to the state in the form of said tax. It doesn’t make sense to render these much needed affordable housing projects infeasible, or reduce the number of units provided, in order to raise state revenue via the current, Kafkaesque gross receipts tax regulations.

Another bill, House Bill 200, would help homebuyers priced out across the state by providing development subsidies to construct new below-market-rate homes. This bill, called New Homes New Mexico would earmark $25 million in funds to build approximately 500 homes. The development subsidy would convert into downpayment assistance for first time homeowners at sale. The program targets families earning less than 120 percent of the Area Median Income ($93,000 for a family of four in Taos). In high cost markets like Taos, the assistance could be up to $75,000, which could greatly expand the purchasing power of many families.

The bill not only seeks to help individual families afford their first home, but it also would spur new housing development by removing some of the risk involved with finding qualifying homebuyers and by making projects more financially feasible.

Additionally, Habitat for Humanity of Taos is making a capital outlay funding request during this legislative session to build 10 homes at the Chamisa Verde subdivision. Habitat for Humanity of Taos provides homeownership opportunities for low income households — those earning less than 60 percent of the area median income — in Taos County.  While we’ve heard a lot recently about the 3D printed homes sponsored by the Town of Taos in Chamisa Verde, Habitat for Humanity also has site control of several lots in Chamisa Verde, and has been steadily building affordable homes in the subdivision.

The capital outlay request would enable Taos Habitat for Humanity to build 10 more homes during a “blitz build” later in 2026. This request from Taos Habitat for Humanity is part of a $12 million statewide request in collaboration with the Center for Housing Economics. All eight Habitat affiliates in the state are seeking funding for a total of 71 homes.

Given this column’s focus on land use reform, I would be remiss not to mention some land-use bills being proposed this session. Specifically, these bills could eliminate a local government’s ability to restrict housing development in commercial and transit-adjacent areas. As I’ve mentioned before, land-use policy is typically local. But across the U.S., states have taken action to supersede local land use codes when local jurisdictions uphold exclusionary zoning practices that limit the amount of housing being built. While it seems unlikely that these particular bills will pass, it’s important to keep pushing the dialogue on land use code reform.

Taos Housing Partnership will continue to monitor these bills and post advocacy opportunities and updates on our website and our newsletter. Check taoshousingpartnership.org for updates and advocacy opportunities. The 2026 legislative session continues through Feb. 19 at noon.