Just how good the good times were to New Mexico was on full display this week as the Legislature and Governor moved to cover a $450 million shortfall. Yes, the axe fell but the pain was minimal as money set aside for "pork" projects was diverted to the general fund and state agencies were nicked for minimal cutbacks for the budget year that ends June 30. Major services will suffer no cutbacks and while there is a hiring freeze, unlike other states we won't see any layoffs--at least not yet. And the biggie--no tax increases.

The Guv and the Legislature didn't hurt themselves by pretty much uniting in public. That gives us guarded confidence that our leaders can avoid a nightmare scenario like the one unfolding in California. The R's tried to make some hay over the Guv's proposed equestrian center, but it was cut, just not eliminated. In the end, the bill cutting the politicos precious capital outlay by $94 million--including the Guv's--passed on a 38-4 vote.

And there's still more leftover pork (capital outlay) to help cover Santa Fe's next big project--covering another huge shortfall for the budget year that starts July 1. But that's where the rubber could meet the road. How much will that shortfall be? Estimates will come at the middle of the month. Senate Finance Committee Chairman John Arthur Smith is not optimistic, saying New Mexicans need to prepare themselves for a stunning number. Early betting is that a reduction in pay for all state employees could be needed to keep the state solvent. It's easy cutting pork fat, not so easy cutting into bone. Can the unity we've seen thus far withstand real pain?

POLITICAL HOTBEAD AT UNM
Senator Lopez
University of New Mexico Prez David Schmidly and Board of Regents President Jamie Koch will appear before disgruntled faculty who have called a meeting over a proposed no confidence resolution in Schmidly, Executive VP David Harris and Regents Chairman Jamie Koch. Harris won't say whether he will go to the meeting. Schmidly says he doesn't have the power to order Harris to attend. Which raises the question: Mr. Harris is being paid $428,000 a year, plus perks. Who does he answer to?

Meanwhile, Koch has been waging a PR offensive since uttering abrasive comments over the faculty petition seeking the no-confidence resolution that sent them on the warpath. He came with a general commentary on education in the ABQ Journal, but there isn't much specific about the very high administrative salaries and the charges of cronyism that are at the heart of campus discontent.

All of this is grist for the mill at the Legislature. Taxpayers foot the bill and their representatives conduct the oversight. Koch is up for reappointment to the Regents, giving Senators a chance to hold him accountable.

Senate Rules Committee chair Linda Lopez gets the nomination first. She is pledging not to go soft on the UNM story when Koch comes before her committee:

"(The turmoil) does have an effect, and...when any of the regents come in front of our committee there will be questions, many questions...I can...promise that will happen. It will not be a smooth-sailing, no-questions-asked hearing."

Lopez's performance (and those of other committee members) may be as closely watched as Koch's. And it just isn't the administration she will be asked to scrutinize, but also the faculty and whether the state is getting a bang for the big bucks paid to them. Koch might have fun answering that question.

On the whimsical political side of this, one reader wonders what would Lt. Governor Diane Denish do if the vote in the state Senate to confirm Koch ended in a tie? In that highly unlikely event, she would get to cast the tie-breaking vote for or against her old political ally. Such a vote looked a lot easier for her a year ago.

TOO POWERFUL?
Jamie Koch
Is it welcome accountability or a power grab that strips Schmidly of authority and places it in the hands of Regent Koch, a former chairman of the NM Democratic Party? That's the question being asked in light of this news item:

University of New Mexico regents will play a bigger role in writing next year's budget, requiring the president and others to justify the funding their offices receive. "We're doing something that's never been done before," regent President Jamie Koch said, adding that the board will not rubber-stamp anything.

While some see the consolidation of budget power with Koch and the regents as beneficial in a time when the budget of the university is being subjected to cuts, others see it as a diminution of the UNM presidency and further evidence of how politicized it has become. From the e-mail bag comes a Senior Alligator with longtime UNM ties:

...The Alligators know a movida when we see one. Jamie takes over after setting up his "mark"! Poor Schmidly, this would not have happened to Dan Lopez! Of course that is why he wasn't chosen as president. Now we can watch the denouement and the further decline of UNM. Where is Richardson's hand in all of this and will Linda Lopez' committee take Koch, Harris and Schmidly to the woodshed?

Many, many questions about the direction of our "Harvard on the Rio Grande." Senator Lopez will need a thick briefing book to get through them all.

RACETRACK WHERE?

Have the Tucumcari racino advocates heard the same scuttlebutt we have about the Moriarty racino?

The Quay County Gaming Authority agreed to extend its option on land near Interstate 40. The authority (made) efforts last year to land a race track license from the New Mexico Racing Commission. It voted unanimously to renegotiate its option on about 250 acres of land for $6,000. “I’m not trying to give anyone false hope ... but we want to keep our options open,” said Warren Frost, executive director of the authority and an attorney from Logan.

Paul Blanchard, president of the Downs at ABQ and major Friend of Big Bill, won state approval to move out of the fairgrounds and into Moriarty. But questions have been raised about the status of the financing for the new racino. Tucumcari residents will definitely stay tuned...

THE BOTTOM LINES

From David Letterman: "Ladies and gentlemen, while you were applauding that joke, another Obama nominee dropped out."

Be part of the blog. E-mail your news and comments, anonymously if you wish.

(c)NM POLITICS WITH JOE MONAHAN 2009
Not for reproduction without permission of the author

Domenici
New Mexico politics has become even more surreal with word that retired NM GOP US Senator Pete Domenici is being investigated by a federal grand jury for his part in the firing of former NM US Attorney David Iglesias. If so, the state's two most prominent politicians of the past generation are both caught up in federal probes. A federal grand jury in ABQ has been meeting since August, investigating alleged pay to play schemes in Big Bill's administration. The news of the Pete probe was cracked open by the national political blog Talking points Memo:

A federal grand jury probe of the firings of nine U.S. attorneys during the Bush administration is focusing on the role played by recently retired Sen. Pete Domenici (R-NM) and former senior Bush White House aides in the 2006 dismissal of David Iglesias as U.S. attorney for New Mexico, according to legal sources familiar with the inquiry.

The federal grand jury is investigating whether Domenici and other political figures attempted to improperly press Iglesias to bring a criminal prosecution against New Mexico Democrats just prior to the 2006 congressional midterm elections, according to legal sources close to the investigation and private attorneys representing officials who prosecutors want to question.

Just when he thought he was out--they dragged him back in. The Senate Ethics Committee "admonished" Pete for his involvement in the US Attorney scandal and everyone thought that was that. Now Domenici, 76, faces the prospect of expensive legal fees and a disrupted retirement. Pete's lawyer did his best to knock down the TPM report, but he didn't sound too convincing in his interview with the ABQ Journal. Pete told the paper he is not aware of any grand jury probe. But TPM has been on the story for years and has not had a major miss yet.

Sen. Wilson Beffort
Can Senator Dede get together with Senator Sue? If they could, we'd have a good chance of cleaning up a major source of unregulated cash going into political campaigns in these parts. That being the hundreds of thousands of dollars shoveled in by political nonprofits that claim--without tongue in cheek--that they are actually conducting issue "advocacy" and not targeting candidates when they mail hit pieces. Dede--ABQ Dem State Senator Feldman--has again come up with a measure to limit campaign contributions, but Sue--ABQ GOP Senator Sue Wilson Beffort--goes her one better. Unlike Feldman, she proposes (SB 262) limiting campaign contributions from nonprofits to $2300 per candidate per election. The same amount would apply to statewide candidates and political action committees. She also proposes a donation limit of $1000 for legislative candidates, below the $2300 Feldman is requesting.

Nonprofits, led by political operative Eli Lee, say because they are federally approved they aren't required to disclose where their money comes from or what they spend it on. The Attorney General disagrees and the matter is before the federal courts. Wilson Beffort's contribution limits for nonprofits would not necessarily make them reveal their funding sources but the amount of unaccountable money would diminish tremendously. The big money has been coming in here from "progressive" nonprofits, but conservative nonprofits are also currently free to play with as much money as they want and without meaningful accountability.

Feldman and the progressive coterie in Santa Fe have before them the door of compromise: a contribution cap that includes all players. If they walk through it, we could finally get a major campaign reform bill approved.

SAM'S WORLD
David Contarino
Frank Foy is dragging some pretty big reputations through the mud, but they are not the kind of players to take it lying down. Foy, alleging in a lawsuit that the Guv's former chief of staff, Dave Contarino, put on the pressure in a pay to play scheme involving certain state investments, got mucho push back when he made Contarino's name public Monday. It turned into a partisan slugfest featuring Foy attorney--former GOP State Senator Victor Marshall--and the voluble trial lawyer and Democrat Sam Bregman. They loudly jousted on the state's TV sets. You can read all about it here and see the shouting match here. As for Contarino, he called Foy's charge a "flat-out lie" and a "total fairy tale." Fairy tale or not, Tuesday's happening was certainly a circus.

IT'S JOB ONE

Job one is New Mexico right now is jobs---the loss of them. The problem remains serious. From the Guv:

The Board of Finance...approved a $240,000 emergency loan to the Department of Workforce Solutions. The loan will cover costs of improvements Richardson ordered in response to increased demand from New Mexicans trying to access unemployment benefits in recent weeks.

JOB QUESTION

What did ABQ City Councilor Ken Sanchez say on the tube the other night about the additional 60 jobs that General Mills says it will create now that the council has approved a big tax break for the company? Did he say that he understands that all the jobs can't go to ABQ residents? Does that mean the General Mills jobs--the high-paying ones in particular--are going to be imported? Is there no requirement that local workers be hired? Not that there's anything wrong with someone from out of town getting a good job here, but we need to get the straight facts on all things economic and business in this environment, especially when we are giving big tax breaks. Speaking of which, how about some breaks from our city council for struggling small businesses here? We're just asking...

MONEY FOR NOTHING?

We caught a glimpse of northern Congressman Ben Ray Lujan on TV talking about the stimulus bill and how much of it would go directly into New Mexico's general fund to help cover the budget shortfalls. We haven't seen anything on the wires about it, so we asked his office for details:

There is a state stabilization fund that will receive an estimated $419 million over the next two fiscal years through the current House plan. Basically, it’s used to prevent cuts in state services.

So that would mean $200 million for the fiscal year that ends June 30 and another $200 million or so for the one that starts July 1st. If that money makes it to the President's desk, it's going to take a little pressure off of lawmakers as they grapple with big budget shortfalls. But problems have developed for Obama and the stimulus, casting doubt on whether that money will be available to our struggling Santa Fe solons.

CIRCLING THE WAGONS?

University of New Mexico alligators say they see signs of a circling of the wagons by the school's Board of Regents. A committee of the seven member panel will meet Thursday and one agenda item reads: "Approval of Regents Resolution Regarding Leadership of UNM." This appears to be a response to the faculty circulating petitions that call for a no-confidence vote in the university's leadership, including Regents chair Jamie Koch. If so, the resolution is sure to set off more fireworks and more divisiveness at UNM--all of it during a legislative session focused on cutting the state budget.

Our UNM coverage has generated a number of e-mails. Let's check some out.

Anonymous---A word to the UNM President: Sir, do not give a raise to someone involved in a pay-to-play scandal, think before adding another Vice President, and take a play from the Governor's book, cut some administrative salaries--freezing salaries after the pay raises amounts to an empty gesture.

Jacob Salazar-- (UNM Executive Vice-President) David Harris gets a great raise, and they wonder why the morale is so low! Since being hired (President David) Schmidly has been all to willing to play in our little patron system. I seriously hope Mr. and Mrs. New Mexico wake up and smell the frijoles! Kudos to the UNM faculty!

THE BOTTOM LINES

Maybe Di and Val can run together? Here they are--albeit a bit blurry---Lt. Governor Denish and actor Kilmer meeting in public for the first time since Val floated his name last year as a possible Dem Guv candidate for 2010 (Click to enlarge). We had wondered if they schmoozed at that weekend event they both attended and the pic tells the tale.

Di seems to be sizing Val up rather closely in this snapshot taken by one of our Alligators who might have had a few hits of champagne before focusing. What's she thinking? Maybe: "You're going to beat me with hair that long?" And what does Val have on his mind? "So you're the gal who makes my buddy Bill see red?"

Next to Di is hubby Herb Denish who seems to be fixated on anything but Val. The pic was taken at Saturday night's La Noche Encantada in ABQ--the annual black-tie social bash of the Hispanic biz community that drew 2,000.

Will this be the first and last meeting of this duo? Or could this be the start of something big?

THE GUV RUNThere is nervousness in the camp of Light Guv Denish over the state pay-to-play federal investigation. She doesn't want it sticking on her Gucci's. So today in Santa Fe:

...Denish will lay out three bills in a Good Government Package aimed at improving transparency and reducing corruption in state government. Bills specifically address campaign ethics reform and transparency in the state contract process...."

The Kilmer candidacy, still dismissed as a joke in many quarters, is starting to get the top political pros thinking--if only for their own amusement. This one agrees with the conventional wisdom that Denish is the odds-on favorite, but adds:

If a Hispanic gets in (the Democratic Guv race) because of Kilmer, we may have a different situation on our hands A three candidate race with one Hispanic would make it harder to predict. But from what polling I have seen, Diane remains quite strong, and I think she's avoided fallout from the pay-to-play scandal. But you're right to say it's all interesting. If Kilmer starts hiring some real pros, and that leads to somebody jumping in, Who knows?

UNM Regent Jamie Koch
A madcap week at the University of New Mexico has left observers and insiders wondering if President David Schmidly is on course for an early departure ala Louis Caldera in '06. The wheels have been wobbly for a while, but now they are threatening to come off. UNM Board of Regents President Jamie Koch delivered an abrasive retort to UNM faculty who say they have had it with the exorbitant administrative salaries and "cronyism" at UNM. They are gathering petitions to force a meeting to have a no-confidence vote on Koch, Schmidly and Executive VP David Harris. Koch, a former chairman of the NM Democratic party, treated the faculty move like a campaign attack.

He...pointed to the Princeton Review, which for two years has ranked UNM No. 1 for inaccessible professors. "That's fine," Koch said of the petitions. "I'm not going to any meeting on it. I'm not surprised. I think the faculty can sure do what they want to do, and I do think maybe the students need to take a look at the faculty and see how much confidence they have in the faculty."

That could be the comment we long remember if it sets in motion a more concerted effort to dump Schmidly. As one of our university monitors e-mails:

It is reported that Schmidly did not perform well (as president) at either Texas Tech or Oklahoma State. So, why was he selected? Because he would be a weak president that Jamie could run roughshod over? Jamie's comments about the faculty should disqualify him as a regent. Urging students "to take a look at faculty and see how much confidence.." is reprehensible and inciteful but is a measure of how this bully operates.

Koch, president of Daniels Insurance, is a major friend of Big Bill who recently reappointed him to a six year term on the seven member UNM Board of Regents. That requires state Senate confirmation, which Koch is expected to win, but it gives his and Schmidly's foes an opportunity to make some hay. But will they? Senator Linda Lopez, chair of Senate Rules, has stood up to the Governor over his appointees in the past. She has plenty of fodder with this one.

KOCH AND COMPANY
Harris (Daily Lobo)
Koch's power at the university is considerable. He works his stuff through VP Harris who is a former state politico with a finance background. Together Harris and Schmidly are pulling down over $1.015 million in annual salary--$587,000 for Schmidly; $428,000 for Harris, plus each is awarded numerous benefits and deferred cash. Schmidly recently ordered a hiring freeze for highly paid employees, but not did not call for salary rollbacks. (That Harris's name has popped up in the federal pay to play investigation into state government has not helped his standing.)

As for Koch, he is known as a prodigious fundraiser for Democratic candidates and causes. Serving on the Regents with him is former Dem state House Speaker Raymond Sanchez who has been quiet during the turmoil.

The critics of Schmidly charge him with being a political tool of Koch and the Governor, causing segments of the campus to doubt his leadership and call for change. The charge of cronyism gained momentum when Schmidly's son was hired for a $94,000 a year university job called "associate director of sustainability." The barrage of criticism forced the son to not accept the post. However, he then landed a job with a company that holds substantial construction contracts from UNM.

It is that kind of wheeling and dealing that is par for the course in the world of politics, but this is academia where at least a fig leaf is expected when politics comes into play. Koch, Schmidly and Harris have formed a powerful triumverate (under the watchful eye of Big Bill) but the faculty is now closing in on a vote of no confidence. Regent Koch can dismiss faculty criticism once or twice, but he, Harris and President Schmidly will find that this is not a political campaign--and the opponents don't go away after Election Day.

A FOOTNOTE ON THIS

Koch's new term on the the Regents is for six years. He has close ties to all major NM Dem political figures, including Lt. Governor Diane Denish. His term would cover the next Governor's four year term. If UNM remains a hotbed of controversy, it could pose problems for Denish who is is under pressure to show her independence. And that takes us to....

KILMER AND DI TOGETHER..

We've been as skeptical as we can be of the notion of actor Val Kilmer seeking the Dem nod for NM Governor, but he keeps making us pay attention. For example, our Alligators report Val showed up Saturday night in ABQ at the premier social event for the city's Hispanic community--La Noche Encantada. Val worked the room and so did Light Guv Di. We didn't get any reports on the two schmoozing. Kilmer, 49, posed for photos at the black tie event that featured dining and dancing until late into the evening. About 2000 turned out, including UNM President Schmidly who, says our attendee, "visited all the VIP tables."

The Hispanic angle on Kilmer is particularly relevant. You may recall that Kilmer ran into trouble when, in 2003, Rolling Stone Magazine reported comments he made about his San Miguel County neighbors:

Kilmer said he carries a gun because it's the "homicide capital of the Southwest" and "eighty percent of the people in my county are drunk." Kilmer later said he'd been misquoted.

KILMER CASH

In rereading the New York Post interview with Val from early November in which he discussed running for Guv, this line struck us: "I have to see if people will put up the money for my run."

Interesting. Kilmer has considerable personal resources, but being able to raise money is a key indicator of a viable candidacy. If he can't get others to come with coin, will his flirtation with a Guv run falter?

Meanwhile, Kilmer is selling 963 acres, downsizing from the 6,000 acres he owns along the trout-filled Pecos River south of Rowe, NM He is asking $10 million. That might be enough to finance a primary campaign, you think?

CAN IT BE DONE?

And observant readers note Kilmer would need to get 20 percent of the delegates to the March 2010 Democratic pre-primary convention in order to win a spot on the June primary ballot. Some are doubtful he can pull it off. To the e-mail bag:

I know its interesting to talk about, but I just don't see some Hollywood guy who supported Ralph Nader being the Democratic nominee. If he was at least involved in local politics instead of behind a gate of a 6,000 acre ranch, then that would be something. Having a pile of money doesn't win an election ask (2008 Dem congressional candidate) Don Wiviott. Di will whoop Val pretty good...