Wednesday, January 14, 2009


A version of this was published in The Santa Fe New Mexican
January 15, 2009

When in doubt, hit the campaign trail.
That seems to be the reflex of Gov. Bill Richardson this week as scandals mount, the state’s economic picture grows more grim, and tensions with the state Legislature — at least the chairwoman of the Senate Rules Committee — grow.

A news release from Richardson’s office earlier this week reminded me of e-mails from his presidential campaign. But instead of naming stops in towns like Cedar Rapids, Iowa City and Des Moines, the new one listed New Mexico towns and cities — and instead of selling himself as the best possible commander-in-chief, Richardson is talking about his legislative priorities and budget plan.

On Wednesday, he went to Farmington, Las Cruces and Roswell to talk about public-safety initiatives. Today, he’s scheduled for a breakfast with “local leaders” in Hobbs; a speech about education initiatives at the Lincoln Jackson Family Center Cafeteria in Clovis; and another speech and “Pre-Groundbreaking Rally” at the Tucumcari High School Auditorium.

Maybe that’s not as romantic as running for president. But the events aren’t that different from speaking to a couple of dozen people in a freezing airplane hangar in Dubuque, Iowa, or strolling bookstores and coffee shops in Portsmouth, N.H.
The audiences are bound to be friendly, and you don’t have to deal with a bunch of grumpy senators or jaded statehouse reporters asking questions about grand juries and lawyers.

Speaking of such unpleasantness: It seems that ever since Richardson announced he was withdrawing as President-elect Barack Obama’s commerce secretary nominee, there’s been a steady stream of news about state scandals popping up.

On Wednesday, two scandals duked it out for column inches and TV news airtime — allegations of pay-to-play at the Education Retirement Board and new revelations about funny expenditures by the state’s regional housing authorities.

For the benefit of those who don’t know the difference between CDR Financial Products and A. Gutierrez & Associates, here’s a pocket primer to recent New Mexico political scandals:

* Region III Housing Authority: Last week, The Associated Press reported a state grand jury is investigating the operations of an Albuquerque-based regional housing authority that defaulted on payments for $5 million in bonds it sold to New Mexico. State Attorney General Gary King has been investigating the housing agency, which the State Investment Council in 2006 concluded had misused bond proceeds to pay salaries and benefits, make loans and buy vehicles. The SIC in May 2008 filed a separate civil action against the agency’s former executive director, Vincent “Smiley” Gallegos, and an Albuquerque bond attorney, Robert Strumor, in an effort to recover the $5 million in taxpayer money. That suit is pending.

On Wednesday, State Auditor Hector Balderas released a report saying all five regional housing authorities he audited “were plagued by weak internal controls and a lack of adequate oversight,” and “the blatant disregard for proper policies and procedures created an environment ripe for waste, fraud, and abuse.” Gallegos has denied wrongdoing.

* Vanderbilt Capital Advisors: Another allegation of pay-to-play. Frank Foy, a former chief investment officer of the state Educational Retirement Board, charged in a civil lawsuit unsealed Friday that state officials pressured ERB and the State Investment Council to hire a Chicago company, Vanderbilt Capital Advisors, which had contributed more than $15,000 to Richardson’s presidential campaign. Vanderbilt lost a total of $90 million in state money.
Richardson’s office and other state officials named in the suit denied wrongdoing.
Rebecca Vigil-Giron
* Secretary of State expenditures: Last week, the Attorney General’s Office confirmed it’s investigating how federal election money was spent under former Secretary of State Rebecca Vigil-Giron. Actually, the investigation was confirmed earlier by a strange news release Friday from the Department of Workforce Solutions, where Vigil-Giron now works. That statement was to deny a rumor that Vigil-Giron had been fired. “Ms. Vigil-Giron informed Secretary Betty Sparrow Doris of a pending Attorney General investigation involving matters not related to her work at the NM Department of Workforce Solutions,” that statement said.

A 2008 federal audit questioned whether Vigil-Giron had properly spent millions of dollars on a voter-education project that included television ads. An Albuquerque advertising company, A. Gutierrez & Associates, received more than $6 million to produce ads, many of them prominently featuring Vigil-Giron, who unsuccessfully ran for Congress last year. State records could substantiate only about $2.6 million of Gutierrez’s costs, the audit determined. Payments by the state to the company exceeded a contracted ceiling by more than $300,000. Vigil-Giron has denied wrongdoing.

* CDR: This is the grand jury investigation that cost Richardson a cabinet position. The federal grand jury in Albuquerque is looking at whether CDR Financial Products was awarded bond work for the state transportation construction projects because of campaign contributions totaling more than $100,000 from CDR and its chief executive officer.

Richardson has denied wrongdoing, and some of his supporters privately say the whole case is a political witch hunt by Republican prosecutors — remember the Justice Department scandals of 2007, some Richardson supporters say — who are out to make the governor look bad.