New Mexico Match Fund Federal Compliance Offset Grant Application

The Office of Governor Michelle Lujan Grisham and the Department of Finance and Administration (DFA) continue implementation of the New Mexico Match Fund with a second-year appropriation of $72 million. The Match Fund was originally created in 2024 by House Bill 177 ("HB177"), sponsored by Rep. Meredith Dixon, Rep. Gail Armstrong, Rep. Susan Herrera, Sen. Pete Campos and Sen. Pat Woods, with an initial appropriation of $75 million Federal Compliance Offset Grants are made to an eligible entity to offset higher project costs incurred due to compliance with federal requirements, such as sourcing US-made materials for construction projects.

Fiscal Year 2026 Federal Compliance Offset Grant Program- The Federal Compliance Offset Grant helps eligible entities cover higher project costs due to federal compliance, such as using US-made materials for construction projects. Application Process and Timeline- Entity will need to provide documentation showing how the cost increase was calculated, including a comparison of project cost estimates with and without federal compliance. Applications are reviewed on a rolling basis using a first-come, first-served approach. Each application receives a date/time stamp upon submission. DFA will review complete applications and make determinations within 20 business days of receipt. If eligible projects are submitted after available funding is exhausted, they will be placed on a waitlist and funded in order of application receipt when funds become available. Application Management- Incomplete applications that remain inactive for 20 business days will trigger system-generated notifications to applicants. If no activity occurs after an additional 10 business days, applicants will be contacted by email and phone. Applications remaining inactive for another 10 business days will be terminated, requiring reapplication if funding is still needed.

Eligible entities include: • County • Municipality (city, town or village) • Drainage, conservancy, irrigation, soil and water conservation, water or sanitation district • Public water cooperative association • Community ditch association • Public schools • Public post-secondary education institution • State of New Mexico or any of its branches, agencies, departments, boards, instrumentalities or institutions • Any other political subdivision of the state • Federally recognized Indian nation, tribe or pueblo, the boundaries of which are located wholly or partially in New Mexico.

Please see DFA's New Mexico Match Fund webpage for additional information.

Monthly reporting will be required starting July 1, 2025.