Thursday, December 06, 2018

Battle Over Pearce: Foes Look For Last Minute Longshot Upset To Deny Him Party Chair Position; Meeting This Saturday, Plus: About That Sixth Racino; Do We need It? Where Should It Go? Racing Commission Decides Today 

Gov. Martinez's political machine is making a last gasp effort to thwart the rise of Steve Pearce to the chairmanship of the state GOP, but it appears to have little chance of success when members of the Republican Central Committee meet Saturday to replace outgoing chairman Ryan Cangiolosi.

The machine candidate is ABQ businessman John Rockwell, who says Pearce represents the status quo and that a new face is needed. But this is Rockwell's third time running for chairman, having been soundly rejected in his past two efforts. In addition, his critics say he has done little to advance his business credentials which are key in raising the millions of dollars the party will need going forward. On the other hand, Pearce is both a veteran congressman and oilman who has the biz connections needed to raise the cash.

The Martinez faction had former NM GOP House Speaker Don Tripp issue an endorsement of Rockwell over Pearce. But Tripp served only one term as speaker during which he did little to advance the GOP's chances of holding on to the majority in the chamber. They promptly lost to the Dems after only one term under Tripp.

The Machine appears to have flipped one R who has become prominent in recent months--Michelle Garcia Holmes. She was an unsuccessful independent ABQ mayoral candidate in 2017 and Pearce's running mate in his unsuccessful Guv run. She has now turned on Pearce and announced her support of Rockwell. But she is a newcomer to the party and has little influence with the central committee.

Meanwhile, Pearce has secured the endorsement of incoming state House Minority Leader James Townsend of Artesia and State Rep. Yvette Herrell of Alamogordo who lost her bid for Congress.

It will be interesting to see how many votes will go against Pearce. Another argument against him is that he has not sworn off any 2020 run for the southern congressional seat he gave up to run for Guv. But Pearce brings to the table money--lots of it--and he has enough of his own so he won't be forced to kneel before the altar of Martinez acolytes like former GOP National Committeeman Pat Rogers who was ousted by much of the same central committee that will pick the new chair.

Pearce may not represent a change to Rockwell, who is still clinging to the skirts of outgoing Governor Martinez, but he is a seismic shift away from that Governor and her notorious political consultant Jay McCleskey who have made so many enemies in the party. Ultimately it is that change that most insider Republicans hunger for and which Pearce represents.


The State Racing Commission Thursday tabled a decision on the proposed sixth racino until pending litigation over it is resolved.

This week we pointed to a possible racino (slot machines and horse racing) in the Clovis area as providing a potential kick start to the 2019 economy on the east side. Reader Richard Randles responds:

You must have good info not to mention the other cities besides Clovis that are in contention for the racino. I have no opinion other than NM does not have the horse inventory for another track per a very reliable source who has been in racing over 40 years nationwide. 

Richard is right. There are other cities in contention for the racino but we see Clovis as the most natural location:

Five bidders are competing for the sixth and last New Mexico racino license permitted under tribal compacts. Three of the five bids propose a racino in Clovis; the two other projects are proposed for Tucumcari and Lordsburg. The State Racing Commission is expected to make a decision – which could include opting not to issue a license – on Thursday.

The operators of the current five racinos have written a letter asking the commission to nix the awarding of any license, pointing out what Randles argued:

The decline of the horse breeding industry here and nationally will make it difficult to find animals to race on a sixth track; attendance at live races and those that are simulcast are already falling; and the presence of a sixth track would cannibalize revenue generated by the existing racinos, among other concerns.

They have a point but the proposal from Las Vegas developer Full House Resorts does seem promising. The company is already listed on the NASDAQ so it should be able to secure the necessary capital to make it work. Full House is currently valued at about $78 million. Their proposal for a $200 million racino includes a moving grandstand at the racetrack which is also intriguing. Not that they don't have their problems, as this article examines.

Most important, of all the proposed locations Clovis would finally do what gambling supporters have claimed would happen but hasn't--a Clovis racetrack and casino would attract many of its gamblers from out of state--from Texas. A Clovis racino would actually help end the cannibalization that we are seeing in the NM gaming industry and bring in new players and new money.

Let the Texans come here and drop those taxable dollars and finance the New Mexico jobs and then take their problems home with them. That's what makes Las Vegas such a success--the tourists--and Clovis could be a mini example of that.

It's true that New Mexicans are over gambled with five racinos and a bevy of tribal casinos. There's a good argument to be made that no racino should be authorized by the commission. However, if we're going to do it, a Clovis racino holds out the promise of being the most lucrative by tapping into the hefty piggy banks of those Texans only a few miles from Clovis and who are itching to bring their gambling dollars to New Mexico.


As for the decline of horse racing and the difficulty in finding horses to race, that problem belongs squarely in the laps of the existing racinos that continue to reap millions from the slots, a portion of which is pledged to advance horse breeding and racing in the state. Even though they are not making what they once did, the racinos are still very profitable. And improving the breeding and racing industries was a key reason why the state authorized racinos in the first place. Can't they do better for New Mexico's young horsemen and women? Shouldn't they be doing better?


The racino proposal is attracting a true cast of lobbying characters. Look at the names trying to influence the racing commission to give their clients the deal at today's meeting. From one of the Alligators:

Republicans Darren White, Pat Rogers and Joe Thompson have been working for L&M Entertainment, a joint venture of Laguna Development and an Illinois company that wants to build a casino and track in Clovis area. Former NM House Speaker Raymond Sanchez and former state House Majority Leader Michael Olguin are in with Full House Resorts, which also wants to build in Clovis. Rob Doughty, attorney and Gov. Martinez appointee to the UNM Regents,  is representing Shaun Hubbard, Johnny Cope et al in a third proposal for Clovis racino. Quite a cast of characters, eh?

A real cast of characters indeed. No wonder Netflix is coming to ABQ.


Thanks to the NM Association of Counties for having us to their meeting at the downtown ABQ Hyatt this week to moderate a panel of media aces who provided advice and fielded questions from newly elected county officials from across the state.

From left to right in this photo is KRQE-TV investigative reporter Gabrielle Burkhart; veteran PR man and journalist Gerges Scott of Agenda; your blogger; Rebecca Long, president of the NMAC and a Lea County Commissioner; Melissa Perez, the public information for Sandoval County and crack Santa Fe New Mexican government reporter Andrew Oxford. There was no fake news in that bunch. Fun stuff.

That's it for now kids but we'll be here Saturday to update the results of the race for the NM GOP chairmanship and later today we'll update the blog with whatever the state racing commission decides on that sixth racino.

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Wednesday, December 05, 2018

On The Econ Beat: Market Jitters Prompt Recession Talk; Where Does NM Stand? Plus: Some Economic Drivers And Worries 

The price of oil continues to hug the low 50's, which is around the $55 mark that the bean counters at the Legislative Finance Committee are counting on to give the state a budget surplus in the vicinity of $1.5 billion and perhaps more.

The oil price is almost as critical to the success of Governor-elect Lujan Grisham as her Election Night victory. Without that surplus you're pedaling in place. With it you're off to the races.

The increasing talk of a possible national recession brought about by jittery markets is worrisome for New Mexico policy makers. The old paradigm that New Mexico is largely immune to national downturns is long gone. It was only this week that it was announced the ABQ metro finally inched past the employment levels it had in 2007. That's 12 years of digging out of a deep, deep hole while our neighboring states were booming.

Much of the employment gains have been in the nongovernmental sector, with low-paying service and hospitality jobs making up a large share. The construction industry has rebounded on the strength of the Los Lunas Facebook build out.

A national recession here would hit those who are least prepared to weather it--those in the service and hospitality industry making low wages. Those businesses would naturally slow as consumers shied away and tourism contracted.

Until the Great Recession took hold a decade ago good paying government jobs (and government contracting jobs) were the stabilizing force. But we lost many of them through federal budget cuts. The economy here is now more dependent on national trends.

Still, there is an argument to be made that another recession might not be as severe as it would be elsewhere. But that's because our state has already lost so much in the way of jobs, economic development, stagnant home prices and population that there is essentially much less to lose.

Given the iffy economic backdrop the projected giant state budget surplus looms large. It could finance an array of projects that would create jobs and provide some economic stimulus that could soften the blow of a downturn.


There are some but not many economic drivers outside of the booming oilfields that could give 2019 a boost.

--The Netflix deal with ABQ is set at $100 million a year in production for ten years.

--If the NM Racing Commission approves a racino for the Clovis area that would draw Texas tourists to that region. The commission will decide by the end of the year.

--The aforementioned Facebook build out in Los Lunas should continue, recession or no recession.

--The incoming administration in Santa Fe is expected to boost employment levels in critical agencies like CYFD where jobs have been cut. That will give the Santa Fe area a pop.

--The City of ABQ is working to add hundreds of police officers to its force. Thanks to a tax increase those are now well paying jobs. If a good share of them are not simply lateral transfers from other metro police agencies they will add to the economy.


As usual, there are many things to fret over when it comes to advancing the state and metro economy.

--The ABQ International Balloon Fiesta--the state's premier tourist attraction that brings tens of millions into the economy--appears to be wobbling. Attendance has peaked, which is to be expected, but management execution is also lagging, as witnessed by this year's park and ride fiasco. It wasn't the first time and if they can't get it fixed the damage could be irreversible. The Fiesta has already permanently lost thousands of paying fans because of the incompetence.

--Crime is reported to be coming down some in ABQ but nowhere near fast enough to make the metro more economically attractive. The levels reached here have been atrocious, so you will need stunning drops to reverse the perception of outsiders. So far, we have not seen that kind of decline or any inkling of it.

--Education performance lags badly, another key driver in attracting good paying jobs for the locals. If Lujan Grisham and company can't give a convincing presentation on how and why that will fundamentally change, there will be more folks pulling up their stakes and moving on.


Longtime GOP State Senator Carroll Leavell has resigned. The 82 year old has been battling cancer for a number of years. He was first elected to his Eddy and Lea county seat in 1996. The county commissions of those two counties could recommend a replacement (s) to Gov. Martinez whose term expires at month's end but the new governor would get the appointment if the process goes past Jan. 1. Democratic Senator Pete Campos offered these thoughts on Leavell of Jal:

He has a sharp intelligence that guided us through tough financial times, an uncanny ability to present the most complex insurance matters and assure his colleagues that the legislative purpose was written for the common good, and presented himself in the most humble and dignified fashion which earned our confidence that “his word was his bond.” State Senator Leavell, you are a great statesman and confidant. God’s speed to you and Bobbie in all that you do.

The NM Senate Republican Office came with this tribute.

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Tuesday, December 04, 2018

Anxious Progressives Eye Upcoming Session; Big Election Win Vs. Conservative Senate Dems, Plus: Taking A Pass On Pat And Stephanie Speaks  

Anxious progressives are eyeing the upcoming legislative session, with one of those in the forefront of the movement admitting that uncertainty prevails. That's despite the sweeping election victories posted by Democrats in the state House and the gubernatorial race.

Former ABQ state Senator and City Councilor Eric Griego, 52, now state director of the progressive Working Families Party, says conservative Democrats who often plot with Republicans in the state Senate still represent a formidable obstacle to the progressive agenda.

Legislation we favor will rush through the House where Democrats are not as split but the real test will be when those bills hit the Senate. That's where the intrigue begins.

Griego says the first signal on whether the long-standing conservative coalition will acknowledge the election results could be the proposal to raise the minimum wage. He says progressives would like $15 an hour but would be happy if they can pop it from $7.50 to $10.

Governor-elect Lujan Griham supports a $10 minimum now, with a bump to $12 an hour in several years and she wants it indexed for inflation.

Griego thinks the House will go for the $10 or more with no restrictions. Then. . .

Grants area Senator Clemente Sanchez of the conservative coalition will probably again be key. He sponsored an increase in the minimum to $9 last year but it had attached an $8 an hour "training wage" for the first two months of employment. And unlike the minimum wages already on the books in Santa Fe, ABQ and Las Cruces, the bill did not contain any future adjustments for inflation. Griego said those are deal breakers for the progressives and adds:

The House is likely to send over a clean $10 an hour bill without those provisions--a straight up increase. Will Senator Sanchez and others in the coalition go for that or not? That will be a critical moment that will tell us much about the course of this post-election legislative session. 


Eric Griego
Griego thinks one item on the progressive check list has a decent chance of passing--same day voter registration which is being advocated by Secretary of State Toulouse Oliver.

But the outlook is murky for other progressive favorites such as firm state regulation of methane leaks in the oil and gas fields. That will have to come from the state regulatory process under the Governor.

On the proposed constitutional amendment to tap a small portion of the $18 billion Land Grant Permanent Fund for early childhood programs, Griego says there are already efforts to water it down dramatically or in the case of the coalition prevent passage of any amendment. Lujan Grisham says she supports the amendment but has differed with progressives who want a full one percent per year of the Fund to go to early childhood education.

Initial comments from Senators Sanchez and John Arthur Smith remain unfavorable toward the amendment which would require voter approval. Senators George Munoz, Mary Kay Papen and John Sapien are the other Dems who coalesce with the R's in thwarting the progressives and have consistently opposed the amendment.

Griego says with the state moving increasingly toward the blue column the outcome of this session could hinge on whether any credible candidates begin to emerge to challenge the coalition Democrats in the 2020 primary elections.

If folks start putting their pictures in the window that could make a big difference.

Meanwhile the uncertainty and intrigue over the conservative Senate coalition will continue, only to be answered by the 60 days of lawmaking that will commence in January.


Councilor Davis
Speaking of progressives, the year is ending on a sour note for one the more prominent members of that tribe. ABQ Dem City Councilor Pat Davis, coming off a June primary defeat for the ABQ US House nomination, made it 0-2 Monday when the nine member council unanimously chose Dem Klarissa Pena as their new president for the next year.

Davis was campaigning behind the scenes for the post--his second attempt at it since he joined the council--but it was not to be. There were no sympathy cards coming his way from the 11th Floor. Mayor Keller and Councilor Davis have tangled on a variety of mostly low-key matters in Keller's first year at the helm. Davis as President could have slowed his honor's mo.

There is some irony here because it was progressive Davis who was thought to be the most natural ally of Dem Keller when the new mayor came in last year and that the three moderate west side councilors--Pena, Sanchez and Borrego--would be the big thorns in his side.

What's next for Davis? Well, he's up for re-election next year to his liberal SE Heights district but has not yet said if he will run again. Now that there's a Democratic Governor could he end up in her administration? He left his job as head of liberal grassroots group ProgressNow NM when he made his congressional bid.


State Land Commissioner-elect Stephen Garcia Richard was scored by one of the Alligators here Monday for going silent when asked to respond to media inquires about potential regulations for methane. In a newsletter following that blog, Garcia Richard lists her priorities and said this about methane:

On average, the people of New Mexico lose at least $100,000 a month in revenue that should fund our schools and hospitals from industry leaks and intentionally flaring methane. A series of rules must be implemented to require the capture and accurate reporting of methane.

She also announced a public tour prior to the legislative session that includes a December 15 meeting in Silver City and sessions in Las Cruces, Santa Fe and ABQ. So there you go Gators, Stephanie speaks!

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Monday, December 03, 2018

Will BernCo Benefit From Posting A Blow-Out Win For New Guv? Plus: Silent Stephanie; Land Commissioner-Elect Stirs The Alligators, And: More Political News From Indian Country  

What will Governor-elect Michelle Lujan Grisham do for Bernalillo County? It's not as if something special shouldn't be in store. The final certified election results reveal just how pivotal Big BernCo was to MLG's victory and thus the expectation that while she serves the entire state, the ABQ metro has a special calling card with the soon-to-be 32nd New Mexico Governor.

For starters, she carried the state's largest county by a margin of 62% to 38% over Republican Steve Pearce. That landslide translated into an astounding margin of victory of 58,259, the largest here in gubernatorial history. Put another way: Lujan Grisham won the governorship by100,277 votes statewide. If only her BernCo victory remained intact and her lead outside the county had completely vanished she would still be headed to the Fourth Floor. That's BernCo power talking.

The ABQ metro which former Mayor Marty Chavez dumbed the "economic engine that drives the state," has many needs and problems after a grueling decade long recession/stagnation. Crime and drugs top the list; a mostly listless economy is a close second. Here's a list of projects the city council is planning to propose for state funding,

Will MLG effectively team with Mayor Keller and the metro's legislative delegation and think big for the state's big city? There are 58,259 reasons why she should.


If the Guv election were decided by the number of counties a candidate won, Republican Pearce would be the one announcing transition team members. Pearce carried 19 of the 33 counties. Those numbers reveal the widening split between the rural areas of the state and the major population centers on the Rio Grande--ABQ, Santa Fe and Las Cruces that went heavily for MLG.


Taos, also on the Rio, was her banner county, giving her 81 percent of the vote. Pearce's home county of Lea was his sweet spot. He corralled 78 percent of the vote in his home county.


We glanced at a newspaper article that put the total voter turnout for the November election below 700,000 and the projected state surplus for the next budget year at about $1 billion. But the SOS reports the final turnout number is 701,654 and the budget surplus projection is actually at $1.2 billion and expected to increase when the next projection is made.


The woman about to become the next state land commissioner has clammed up and that has one of the Senior Alligators out on patrol. Look out. Here comes a Gator strike:

Concerning the transition of Democrat Stephanie Garcia-Richard to Land Commissioner. Why is she standing silent on the methane regulations when the out-going Republican Land Commissioner Aubrey Dunn is shouting from the rooftops about egregious environmental violations, the lack of enforcement and the lack of cleanup by oil companies? Why did she have no comment in the front page story about NM ranking at the bottom in methane emissions control? Her silence is not only curious but deafening.

Could it be that Patrick Padilla, former NMOGA employee and EOG Resources (an oil and gas company in Midland) lobbyist is driving the ship and is a key member of her transition team? Why the change of heart from her progressive policy of clean up and clean energy to a retreat to the status quo of what oil and gas wants, oil and gas gets?

Well, we don't know if Stephanie is retreating but she is pretty darn quiet for a candidate who had some of the loudest environmental supporters on the campaign trail. And they gave her big money while her GOP foe was mostly financed by the oil boys.

Her mum is the word stance might be okay if she were still a state representative, but won't cut it when you're in charge of the state's second most powerful constitutional office:

Garcia Richard has not responded since the election to repeated ABQ Journal inquiries by phone and email to discuss her position.

One would expect Garcia Richard to soften somewhat her most ardent progressive stances as she is now supervising a once in a generation explosion in oil production that will add billions to the state's coffers in the coming years. But the folks who brought her to the party still want to dance, not watch her play wallflower.

And there you have your first Gator strike, Stephanie. Congrats, or something.


Leonard Tsosie
Our coverage of the Navajo Nation election brought news to our e-mail that former Dem NM State Senator (1993-'07) and Navajo Nation Council delegate Leonard Tsosie was defeated in his bid for re-election to the council Nov. 6. Tosise, 63, was first elected to the council in 2006. So what went wrong? We call once again on Navajo Gator:

Joe, his opponent Daniel Tso had previously served on the council and has been very active with the progressive arm of the Democratic Party, opposing drilling near Chaco National Park and fracking. Tsosie has also made enemies on the council by objecting to issues on the council floor, most notably trying to raise the council salary by referendum. It’s been interesting to see Tsosie become more alienated from his peers and having his home chapters see him as an obstacle. Moreover, he just seemed to lose the passion for his place on the council, hence his haphazard campaign— few radio ads and a few signs posted near his chapters. A new rumor: Tsosie is running for his old NM senate seat held by Bennie Shendo.

Shendo vs. Tsosie would be a 2020 Democratic primary. No R's need apply in the heavy Dem district.


From reader Gordon Glass in Farmington, we get this:

Joe, Thank you for mentioning the Navajo influence on Democratic election successes in both NM and AZ. I encourage you to comment on how the Senators, US Reps and even the new local State Rep. Anthony Allison might immediately address the challenges of declining coal and related power production including a shift to renewables. These candidates received strong support AND need to work together in visible ways to address these difficult challenges that also affect the Hopi people as well.

Thanks for the note, Gordon. Dem Rep.-elect Allison, a retired electrician, pulled off one of the biggest Election Night upsets when he defeated fellow Navajo and popular three term GOP State Rep. Sharon Clahchischilliage in the Four Corners district as the blue wave flowed over and around the Rez.

As for the switch to renewables, PNM is set to close down its coal-fired San Juan Generating Station in 2022 which will mean hundreds of lost jobs. Reader Glass is involved in the San Juan Citizens Alliance, an enviro group working to limit the economic damage that will be caused by the closure.

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