A. A municipality may grant, by ordinance, a franchise to any person, firm or corporation for the construction and operation of any public utility.

B. No franchise ordinance shall become effective until at least thirty days after its adoption, during which time the franchise ordinance shall be twice published in full, not less than seven days apart.

C. If, during the thirty-day period, a petition signed by bona fide adult residents of the municipality equal in number to twenty percent of the number of those who voted at the last regular municipal election, and objection to the granting of the franchise is presented to the governing body of the municipality, the governing body of the municipality shall submit the question of granting the franchise to a vote of the qualified electors at a regular or special municipal election. If the date for the next regular municipal election is not more than ninety days after the date the petition is filed, the question shall be submitted at the regular municipal election; otherwise, a special municipal election shall be held.

D. If a majority of the qualified electors voting on the question favor the granting of a franchise, the franchise ordinance becomes effective. If a majority of the qualified electors voting on the question do not favor granting the franchise, the ordinance is repealed and the applicant for the franchise acquires no rights or privileges.

E. The expense of publishing the franchise ordinance and of holding a special election shall be paid by the applicant for the franchise.

F. No franchise ordinance shall be in effect for more than twenty-five years. The municipality may contract with the public utility for such services as are necessary for the health and safety of the municipality and may pay a sum agreed upon by the contracting parties for such services.

History: 1953 Comp., § 14-43-1, enacted by Laws 1965, ch. 300.

Cross references. — For definition of "publish" or "publication," see 3-1-2 NMSA 1978.

For continuation of franchises in combined city-county municipal corporations, see 3-16-15 NMSA 1978.

For municipal utilities, see 3-23-1 NMSA 1978 et seq.

For power of municipality to regulate opening or repair of streets, see 3-49-1 NMSA 1978.

For constitutional restriction on grant of elective franchise, see N.M. Const., art. IV, § 26.

For limitation of actions in suit to question franchises, see 37-1-26 NMSA 1978.

Expiration of franchise. — After a franchise expires, it is continued by operation of law as an implied contract as long as the public utility continues to provide utility services. Moongate Water Co. Inc. v. City of Las Cruces, 2009-NMCA-117, 147 N.M. 260, 219 P.3d 517, cert. denied, 2009-NMCERT-009, 147 N.M. 421, 224 P.3d 648.

Statute prevails over charter. — Where provisions of statute were inconsistent with provisions in city charter, statute prevailed. Albuquerque Bus Co. v. Everly, 1949-NMSC-058, 53 N.M. 460, 211 P.2d 127.

Public utility franchise may be viewed as a contract between the utility and the county. Such contracts may provide for the payment of expenses incident to the granting of the franchise and charges may be imposed on utilities which constitute reasonable expenses incurred in the granting and exercise of the franchise. 1978 Op. Att'y Gen. No. 78-03.

Franchise ordinance in municipality not having newspaper published therein must be published in a newspaper of general circulation in said municipality which may be printed elsewhere. 1955 Op. Att'y Gen. No. 55-6322 (issued under prior law).

Am. Jur. 2d, A.L.R. and C.J.S. references. — 36 Am. Jur. 2d Franchises § 10; 64 Am. Jur. 2d Public Utilities § 233.

Duration of franchise granted to public service corporation, 2 A.L.R. 1105.

Estoppel of municipality to deny that it gave its consent to street franchise, 7 A.L.R. 1248, 89 A.L.R. 619.

Franchise provisions for free or reduced rates of public service corporations as within constitutional or statutory provisions prohibiting discrimination, 10 A.L.R. 504, 15 A.L.R. 1200.

Voluntary character of payment of tax or assessment made to secure, or to avoid loss of, franchise, 64 A.L.R. 123, 84 A.L.R. 294.

Duration of street franchise without fixed term, beyond the life of the grantee, 71 A.L.R. 121.

Tax on franchise as a property or an excise tax, 103 A.L.R. 61.

Expiration by limitation of street franchise, right and duty of city and public utility upon, 112 A.L.R. 625.

Competition by grantor of nonexclusive franchise as violation of constitutional rights of franchise holder, 114 A.L.R. 192.

Ordinances, inclusion of different franchise rights or purposes in same ordinance, 127 A.L.R. 1049.

Cooperative utility, use of streets and highways by, 172 A.L.R. 1020.

Discrimination between property within and that outside governmental districts as to public service or utility rates, 4 A.L.R.2d 595.

Municipality's liability in damages for refusal to grant franchise, 37 A.L.R.2d 694.

Initiative and referendum provisions, ordinance granting franchise as within operation of, 72 A.L.R.3d 1030.

Factors affecting award of operating certificate, franchise, or license under state cable television act, 15 A.L.R.4th 961.

63 C.J.S. Municipal Corporations § 1082; 64 C.J.S. Municipal Corporations § 1713; 73B C.J.S. Public Utilities § 71.