$5 billion and counting. That's how much sits idle in state capital outlay funds as the dysfunctional method of getting those funds out the door for needed public works projects acts more like a roadblock than the needed speed ramp. 

Over the years lawmakers have called the system a disgrace and worse but reform efforts have been pushed back because it is our lawmakers who cling to a system that gives them too much power over that money. Today retiring ABQ Dem Senator Bill Tallman takes one last stab at creating momentum for change:

An exorbitant $5.2 billion is sitting idle in the state’s capital outlay reserve. Capital outlay funds are taxpayer dollars set aside to be used exclusively for construction projects. This massive reserve is unfortunate, unnecessary, and not the best use of limited resources. Yet, it doesn’t have to be this way. If New Mexico had a systematic, integrated method of allocating capital outlay, our state would not have this problem. Most of the funds would have been spent by now resulting in more projects being completed in a timely manner. This delay in spending will result in fewer projects being built given that construction costs have skyrocketed. 

Earlier this year, the Legislative Finance Committee reported a 50% increase in private and public nonresidential construction costs in NM over the past four years. This is the second highest escalation in the US and is part of a broader national trend of rising construction costs, which have surged by 43% since early 2019. Most cities, counties, and states prepare 10, 15, or 20-year capital improvement plans whereby they determine how much funding will be allocated in year one to specific projects and then do the same for each succeeding year of the plan. This systematic approach provides for a sufficient amount of money appropriated to either start or complete a project, resulting in very little funding sitting idle. 

Sen. Tallman

Governing magazine has ranked New Mexico’s capital outlay allocation system as the second worst in the nation. For the past four decades, capital outlay funding has been divided equally among the Senate, the House, and the Governor. Each legislator selects from a laundry list of projects they wish to fund. There is no procedure in place to prioritize or vet the projects on a statewide basis. Consequently, the most urgent projects are not prioritized, nor is there any formal coordination among legislators to make sure projects are fully funded so construction can begin immediately, without unnecessary delay.

There is a limited amount of informal, haphazard collaboration among legislators. Thus, as is currently the case, billions of dollars sit unspent for years, waiting for projects to be fully funded. In certain instances, projects are completed that would not have been constructed had a more refined system of allocation been enacted by the state legislature.In lieu of a system employed by most political subdivisions, we have a system whereby each legislator does his or her own thing.

On several occasions I have introduced legislation to reform the capital outlay system, however it was either never scheduled for a hearing or was killed in the first committee hearing. It is imperative that New Mexico act more responsibly with taxpayer dollars by implementing a professional, integrated and strategic plan of allocating capital outlay. 

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Rep. Sanchez (LA Daily Post)

Let's start on a lighter note today. If you want to know if the June 4 primary election is starting to heat up take a look at this social media post from District 40 Dem state Rep. Joseph Sanchez of Alcalde:

It has come to my attention that a mug shot of me from about 13 years ago is circulating. This was the result of a warrant for failure to appear in court for a seat belt ticket. I have disclosed this in every questionnaire where the question has been asked whether or not I have ever been arrested and want to set the record straight. Hope everyone has a great day and God bless. 

That's enough proof for us. Primary season is officially here along with the usual tricks of the trade.

Sanchez is unopposed in the June primary. The sole GOP candidates is Diego Olivas of Mora. Sanchez, a conservative Dem, has rankled progressives in Santa Fe but not Republicans.

And yes, we will again have our decades-long watch over who fudges the truth on the ABQ Journal candidate questionnaire on those little questions like seat belt tickets and/or other infractions candidates make foolhardy efforts to cover up.  

There's always several who stumble down that harrowing and unrewarding path but this year we don't think one of them will be Joseph Sanchez. 

POT WATCH

Our Other Voices blog last Thursday authored by Duke Rodriguez, CEO of Ultra Health, the state's largest cannabis retailer, decried the state of the legal pot industry and drew email responses. Here's a sample:

An ABQ reader writes:

Joe, what happened to distancing? There are some pot shops less than 50 yards from each other's property lines. On Fourth Street from I-40 to Montaño I counted 11 and one about to open. The state is making bank on licensing fees and licenses holders who soon learn their pie in the sky boat is sinking fast. Did MLG really think the Cartels would pack up and go away? Maybe she should have put all that effort into a more pressing issue like CYFD, but how many CYFD lobbyists are there? 

Reader David Strip writes: 

While there were many good reasons for decriminalizing or legalizing marijuana, generating tax revenues was not one of them. Anyone who thought that the revenues would have a meaningful impact on state budgets was indulging in fantasy. Unless you thought we were a state of dopers, all you had to do is look at the market size in Colorado, scale for the population, tweak a bit for cross-border sales and you would come up with estimates that are pretty much in line with what we see today. 

Much of Duke Rodriguez's remarks reflect that fantasy. He blames inflation, fentanyl and continued black market sales for the industry's failure to see continued growth. But why should we expect growth? Once the dispensaries opened, some fraction of existing marijuana users stopped buying from black-market sources and some stopped traveling to Colorado. Some number of people who didn't use in the past for a variety of reasons became users. But one would have expected the market to quickly come to equilibrium, and that's exactly what we're seeing. The lack of profitability stems from the over-expansion of the industry.

Reader James O'Neill writes: 

Given the Governor's rah-rah support for the cannabis industry, where are her news releases touting the accomplishments of NM's alcohol industry? Booze and beer pay a lot more taxes. Why not celebrate sales of oxycodone and other narcotics as well? As for Ultra Health and the (few) other big players, they just have to hold on for another year or so to drive out all the small players and finally reap the fat financial rewards they've been dreaming about. No doubt they will use the time to lobby for reduced tax rates since they are such a distressed industry. 

THE BOTTOM LINES

We note the passing of longtime friend, blog reader and public servant Carmie Toulouse who died earlier this month. From her obit: 

She spent 30 years as a civil servant in the NM Human Services Department. . .After her retirement, Carmie dedicated herself to furthering education in New Mexico. She was elected to the CNM Governing Board and served 12 years before being elected to the Public Education Commission where she served 15 years. She shared her talents on many boards and volunteer positions. Carmie loved reading, travel, education, history, car racing, opera, cooking and New Mexico politics.

Carmie Toulouse was 78. 

This is the Home of New Mexico Politics.  

Garcia Richard

Election '26 is a far off affair but it appears it could already be influencing state energy policy. 

State Land Commissioner Stephanie Garcia Richard has made a sudden turn and is now going after the oil boys. In what appears to be an unprecedented decision she has halted leasing for oil drilling on prime pieces of state trust land until the royalty rate is raised to 25 percent from 20 percent, the same as Texas.

This comes after six years of Garcia Richard, who took office in 2019, letting the industry be. 

She did mention a royalty rate increase upon taking office, but a review of her news releases for the following years reveals no mention of increasing the rate. So her full-throated attack has raised the specter of politics playing a role. The Commissioner defends her decision saying:

I am a fiduciary on behalf of the school kids. It’s my job to make them the most money possible, and leasing these tracts below market rate means that school kids are subsidizing the oil and gas activity.

But insider Democrats are saying that the Commissioner, a former six year state legislator, is planning a bid for the '26 Dem lieutenant governor nomination and that her punishment of oil resonates with the left-wing of the Democratic Party which has major influence over who gets nominated. 

They add that her call for the higher rate is a trigger for some Dems and could help Garcia Richard with fund-raising. Her last campaign report in October showed a meager cash balance of $5,800. 

HIKE STALLS

As for the Legislature raising the royalty rate, the outlook is negative. This past session the liberal House did approve an increase but it stalled in the Senate. 

A member of the Senate Finance Committee tells us the votes still "are not there" for a hike, although Finance Committee Chairman George Muñoz, who has seemed more wary of the oil industry in recent months, came with a statement that showed irritation:

Muñoz said the (royalty rate) bill got held up when he asked about the total tax burden on petroleum producers and didn't get an answer. I agree with her withholding the leases because I'd love to have the best wells in New Mexico saved for our future, not spent today. . . The more we save for the future, the better off we are.

TEXAS VS. NM

Garcia Richard has every right to advocate for a royalty hike and make her argument that it would mean significantly more money for the state's Permanent Fund over the long run. But opponents say comparing New Mexico and Texas rates is like comparing apples to oranges. GOP Sen. Gay Kernan:

You cannot compare Texas and New Mexico because so much land in Texas is private. In New Mexico, we're mostly federal and state land with very little private land. It's just different.

Also, the state has taken in unprecedented revenue from oil and gas the last several years, so much so that legislators have been stymied over how to put all that loot to work. They have resorted to establishing numerous trust funds worth billions from which the interest generated goes to a variety of programs including nearly $1 billion for a higher education trust fund.

With this backdrop of historic revenues, raising taxes on any business entity now is like pushing a rock up Wheeler Peak. Even socially useful taxes like a boost in the tax on alcohol in a state ranked worst in the nation for alcohol deaths, could not get through the Roundhouse. 

LA POLITICA

Combined with her years of silence and now her sudden insistence that the state forego drilling revenue until lawmakers see it her way, the Commissioner's move lends itself to political analysis. 

The sitting Governor offers some advice to the Commissioner:

Whether I agree or disagree, I respect her decision. . . An approach that has worked well for my administration is to try to create partnerships and get everybody with a vested interest to the table to make decisions. We want to make sure the state holds the industry accountable, but this is an energy state, and we need to listen to all stakeholders.

Meanwhile, the other dust that is being kicked up on the '26 campaign trail tells us that the two prominent names being mentioned by the Great Mentioner for the Dem Guv nomination remain Sen. Martin Heinrich and Sec. of Interior Deb Haaland. But if Republican Nella Domenici wounds Heinrich in his re-election bid this fall, his chances could be hurt. 

As for Garcia Richard's chances for the lieutenant governor nod, she is a proven vote-getter and while cynics may decry her move on the royalty rate, she would be a name player in the nomination contest. 

ANOTHER DIVIDE

To further illustrate the divide over oil drilling among state Dems, Rep. Gabe Vasquez of the southern district, in a heated contest for re-election with Republican Yvette Herrell, broke with his liberal NM House colleagues last week on a key energy vote regarding the controversial practice of fracking for oil which is common in the SE NM oil fields in his district:

HYDROCARBON FRACKING: The House has passed the Protecting American Energy Production Act (H.R. 1121), sponsored by Rep. Jeff Duncan, R-S.C., to bar an executive order by the president banning hydraulic fracturing (fracking) of oil and natural gas wells without Congressional authorization, and state that states should continue to be the primary regulators of fracking. The vote, on March 20, was 229 yeas to 188 nays. NAYS: Stansbury, Leger Fernández YEAS: Vasquez

Keep running, Gabe. Just don't look back. Someone may be gaining on you. 

 This is the Home of New Mexico Politics.  

Will it be just few bad men or a broadening and deepening scandal that could bring down more than the five cops already under investigation in the APD DWI scandal? 

That's the question that has lurked since the scandal broke in January, the core of which has cops conspiring with at least one defense attorney to get his DWI cases thrown out of court by having the cops failing to show up for the trials--for a price, of course, which was allegedly extracted from DWI suspects.

Now that question is front and center as the last of the five officers known to be under investigation has resigned from APD but not without dropping a bombshell letter that shook the city's judicial and political centers. (Reports here and here.) 

That letter from Joshua Montaño points to something darker and deeper at APD: 

When I was put on administrative leave, I thought there would be an opportunity for me to talk to the department about what I knew regarding the FBI’s investigation. I thought there would be a time where I could disclose what I knew from within APD and how the issues I let myself get caught up in within the DWI Unit were generational. I thought there would be a time where I could talk about all the other people who should be on administrative leave as well, but aren’t. That opportunity was denied to me though. . . 

Joshua Montaño

My lawyer has explained in order for me to talk to the City about what I knew, I needed to not be the City’s scapegoat for its own failures. Instead, APD Chief Medina has made it seem like there are just a few bad officers acting on their own. This is far from the truth. None of allegations against myself or others in the DWI Unit happened without supervisory knowledge. And they didn’t just happen over a few years ago. From my time as a probation officer, officers all know that our attendance, or non-attendance, at Court is watched over and monitored. 

Montaño's lawyer is Tom Grover, himself a former cop, who has become a leading critic on social media of Mayor Keller and APD Chief Medina over their handling of crime. 

Montaño's use of the word "generational" implies years of possible wrongful activity in the DWI Unit. Hunt has been with APD for 18 years. 

An APD spokesman says the internal investigation is also looking at retired officers. 

Retired APD sergeant and watchdog Dan Klein reacts: 

His letter is clear. He wants to tell all for a deal with the US Attorney. This should scare Medina, Keller, attorneys, cops, retired cops, judges and prosecutors--current and retired. His letter would lead the reader to believe this corruption is deep and goes back a long time. 

Federal investigations often go forward with suspects being asked to tell all they know in exchange for favorable court treatment. Are the dominoes already falling in the APD probe or about to fall? Who else, if anyone, will be implicated in the Federal probe? 

Klein's warning that if there's a time for anyone connected to the DWI scheme--past or present--to be shaking in their boots--this is that time. 

LEGAL BEAGLE ANALYSIS

Here's one of our Legal Beagles tracking what has become a fascinating case in the city and state legal community: 

Montaño is asserting he knows a lot more about APD shenanigans and resents that he (and infers others) were being scapegoated for what all were doing with the knowledge of this from supervisors. He is patently accusing Medina of participating in a coverup by stating "(Medina) made it seem like there are just a few bad officers acting on their own. None of the allegations…happened without supervisory knowledge.” 

Were I in the US Attorney’s office (if this has not already occurred) I would be extremely interested in everything Montaño has to say and would be offering him a deal before he decides to clam up. Implicating Medina and others is potentially quite explosive: if he has the goods on those in the command structure, the whole of APD and those associated with it could come tumbling down. 

Mayor Keller should beware and reconsider his relationship with Medina before he becomes too much of a liability.

POLITICAL FALLOUT 

The political fallout from the DWI scandal is becoming less cloudy as the headlines continue to blare bad news. 

ABQ Mayor Keller never did have much of a chance at winning statewide office--no mayor ever has--but the DWI scandal seems to seal his fate in that regard. He has said he will seek a third, four year mayoral term in 2025 but that too is now more questionable. 

The key is who surfaces to run against him. A Republican would not seem to have much chance in a city dominated by the Dems but an independent outsider Democrat could find an opening (although in an unsettled environment a level-headed, moderate GOP business type can't be ruled out). 

Medina and Keller

Apathy has been Keller's best friend. The DWI scandal could change that apathy to anger. 

There are telltale signs that the scandal is getting more political. Former GOP US Senate candidate and businessman Mich Rich recently penned an op-ed highly critical of Keller and Medina. 

As we said, it's tough for a Republican to win an ABQ election but Rich has the credentials that may be appealing to a disgruntled electorate. He is not affiliated with the current city government power structure. He has enough personal wealth to aid in amassing the $1 million or more needed for a successful challenge and has learned enough about politics to appeal to voters outside of his party and have a go at isolating Keller in the progressive Democratic wing. 

Again, a Dem with Rich's credentials would have the better shot but things can happen if the mayoral derby turns into a multi-candidate race.

DA IMPACT 

The June 4 primary will be the first election since the DWI scandal broke and will have an impact on the race for the Democratic nomination for Bernalillo County District Attorney. 

Appointed DA Sam Bregman is already feeling heat from the scandal from the camp of former US Attorney Damon Martinez. That should be enough to make this a close race, perhaps very close. 

The contest presents a difficult choice for skeptical Dem voters. Bregman's past as a criminal defense attorney has made his dismissal of 200 DWI cases connected to the scandal a political headache and Martinez's service as a top bureaucrat in troubled APD also taints him as an insider. 

PARTY MALPRACTICE?

No Republican is running in the primary so the Dem victor will get the four year term. Yes, it does seem outrageous that the political party party that makes crime their banner issue could not bother to field a candidate for the top law enforcement position in the state's largest and most crime-ridden county. How are we in the media and elsewhere supposed to regard the GOP as a relevant force when they bow out of the race that embodies so much of their philosophy and in the middle of an epic police scandal? Just askin'. 

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