Report from Santa Fe; Manny Aragon

music Report from Santa Fe is made possible in part by grants from the members of the National Education Association of New Mexico, an organization of professionals who believe that investing in public education is an investment in our state's economic future. I'm Ernie Mills. This is report from Santa Fe, our guest today, the Senate president, pro-Tem, many Eragon. And first we want to say if you hear a little musical accompaniment today, that is the contractors, the men hammering and banging on the walls to try to get the capital ready for the 30-day session of the legislature that gets underway January 18th. Senator, you're trying to get the legislature ready for what happened to January 18th.

We're working pretty hard this week with the Legislative Finance Committee, has been meeting since yesterday and will meet through Friday to try to do a roll-up and come up with some recommendations to the legislature in general about next year's budget. This separates them in from the boys, this time of the year. We first got the consensus report on general fund revenues for this state. It's not rosy, not a rosy outlook, either for this fiscal year or the one that starts June, well, July 1st, the next year. What are we looking at in terms of reserves? Can we keep the reserves up? Well, you know, it's a moving target. Reserves is one thing that we've been able to address pretty steadily for the last three years. We're going to have a little over $200 million in reserves and under our prudent manual will probably try to keep about $170 million, which will leave about 30 to 35 million available for one-time expenditures on some capital leads throughout the state of New Mexico.

You can use that. You can use that money for the one-time expenditures. I think the figure you always talked about was like $168 million, so you got $2 million more. At least that looks good. That's always driven by a percentage, which has to do 5% of the general fund appropriation. It would seem to me the biggest boost we got to the economy in this last six months or so was the amnesty program to allow people to pay their taxes, who had not paid them before. But we're having trouble with gross receipts tax revenues, aren't we? Yeah, listen, pretty interesting things going on. The amnesty program was way beyond our expectation. I think they're not calculating that it'll bring in around $65 million, and that'll provide a boost to local communities, too, because some of it was gross receipts tax that we would be glad to have the amnesty, too, and then others are corporate taxes and personal income taxes and things of that sort that'll assist the state. But the surplus that we're talking about just a few seconds ago was actually boosted by that figure.

So it's taking an important role in the reserves that we have, but the amnesty program was successful. Probably more than any man up here, because you serve as the ex officio member of every interim committee and the major ones as well. You know how the work of the interim committee says increased over the years, and it's now it's almost out of sight. But at the same time, the legislative finance committee was meeting, there was a meeting of a 16-man committee taking a look at the gaming compacts. I need to know, either from your own position, Mani Yaregon, or as President Pro Tem, how you feel about the compacts where we're heading on it. Yeah. Well, we were fortunate enough for any last session, last January, to pass a process bill that permitted this type of process to be put in place and gave an opportunity to this administration to renegotiate the compacts that we chose to. And apparently they've got about doing that, about a couple of weeks ago. They submitted a proposal of a negotiated compact that they have entered into with some

of our tribes. Some of them have not signed onto it as my understanding. And it basically provides, as you all know, a graduated revenue sharing agreement with our tribes in the state of New Mexico with an average tax or contribution revenue sharing of 6.2 percent, which under our President's knowledge of what is being spent on tribal casinos is somewhere around $24 million, but then 25 percent of that will be able to be spent by the tribes themselves. And the state of New Mexico would be left with about $18 million if this negotiated compact is adopted by the legislature. I don't think that there is a lot of support for the way that this compact was negotiated or the terms of it. And the negotiation may have been fine and professional and friendly, but I mean, it was negotiated as having some pretty significant impacts in the legislature, and they're concerned about what is involved. One of the biggest concerns I have is our constitutional provision that says that we

cannot forgive debt. And I think a determination has to be made pretty quick by hopefully the Supreme Court so we can get a final sale on it. Does the legislature and the governor have the right to forgive the monies that have already been owed by the tribes, which they signed over two years ago since our Constitution says that we cannot forgive debt? And then secondly, one of the things that really bothers me is the governor negotiating away the laws of the state of New Mexico. And I see that occurring in that we have racing in New Mexico since probably the late 40s or early 50s. And we have a racing commission. And we have a process for people like you and I, and we choose to, and we have the financing and the backing and a good idea of putting in place a racetrack somewhere in New Mexico. You can at least apply and go into the process. And if you mean all the criteria in the racing commission finds it to be suitable and that it would be workable and a benefit to the state and to the racing community, they can license you. This governor negotiated that away saying that if our racing commission or any individual gets another license, we lose 50% of this revenue sharing.

I don't think that it was the intent of the legislature to say that the governor had the authority to negotiate in a way existing state long. I've got to stop you there, but you're saying effective. If we say, for example, on wild terms, say we get 20% of the revenues from the gaming. And then you have the Ernie Mills racetrack and Hobbes that gets a license and say the operation of 300 video machines there. Right. If we do that and that was not included in this compact, then we lose 50% of whatever we negotiated with the tribes, if it was 20, it'd be down to 10. If you open up another racetrack, Ernie Mills is successful with a income and operation, we're really happy with it. And he says, you know what? I can go to Ratton and open up all the Mesa and bring that to vintage back into play. And gets another license. It's down to 5%. If the state in New Mexico decides to add any additional machines at racetrack for returnals and nonprofits for any portion or combination of 100 new machines out of anywhere,

they drop 1% of this 6.2% that you're talking about. If the state decides to add an additional hour of operation at any of these facilities, it drops 1.5% of 1%. So I don't think that the legislature is prepared to give up its legislative authority and deciding what type of how we're going to handle our racetrack. That was in place before these compacts were entered into. And in fact, those are the laws that gave it the ability for tribes to actually have legal compacts at this point. There was something for them to work around. But it was in place before that had to be in place before they could negotiate compacts. So that was part of gambling in New Mexico. I don't think they should be permitted to come back here and say, you've got to remove what you've done for a hundred years or whatever, or else it's not exclusive. I think that that's taking a little bit too much.

We chose to tell the tracks where now you can have card gangs and keynote and Las Vegas style. I think that's an expansion. When it comes down to racetracks and slot machines and hours of operation, I think that it's totally within the legislative authority and the legislature and cannot be negotiating away with the tribes. One more question here before we leave it. When will the court test come up on the constitutionality of what they want to do? This question will come up to a little later today in a meeting with the legislative council because we're going to ask our committee, well, how are you going to address these legal questions before you start looking at the meat and potatoes and what was negotiated? And don't forget that we have at least one entity that is already in the licensing process. The Mesa in Ractone apparently has made for last year four months in application very real jeopardy. I mean, they're complaining, saying, well, we're probably not going to get the license because the grant is a license is going to cost the state when you're Mexican $12 million. I mean, why would the state recent commission give us a license is going to cost $12 million. So now I think New Mexico has a liability with this corporation who has been welcomed into

our laws to apply to now through the state and state boy, this whole process was fixed from the beginning. And I think that we're going to get some direction as to how the legal questions are going to be answered. And I hope that we're able to work this thing out here in the near future. And I would hope that if we're able to, that it would be a successful venture for our Indian citizens and their tribes and make it economically feasible for them to move forward in this very complicated world. But short of that, I don't think the legislature is prepared to give up its legislative authority and its own sovereignty questions that exist for all the people in New Mexico including tribes. I, another area where it's very bright spot on my horizon, but remember, you know, we wallow in the misery of others. Highways, I get a lot of legislative discontent over two projects, New Mexico 44, the kind of creative financing and whether or not they're going to be able to finish that project

in a workman-like manner. And of course, my old friend, the big guy, I've been milking that goat for 41 years. And it's now going to cost at least $203 million, made a bet on this show, a wager, probably illegal with Pete Ron and said, if you finish that in two years, I'll buy the lunch and unlimited martinis. That project is already six months behind and haven't even left the contract yet. What are your concerns? I think that's what you put that out. I mean, just yesterday, I guess, we read that they've extended the time for a start-up because of bad weather at the end, and we're experiencing good weather now. I mean, who to predict the weather two years from now is, I think Pete Ron has probably overstepped his reality check monitors there because I don't think he can predict what the weather is. I mean, the project is already behind schedule.

I just came from Albuquerque, and I live in the south of the valley of Albuquerque. And it takes me, or getting on a real brawl, about 20 minutes to get to that big guy. And that's if it's functioning correctly. The functioning correctly is that the traffic is operating maybe at 25-30 miles an hour. I can't have been sure, I guess, what's going to happen when we do that renovation there and try to get it done in two years. I don't think that that'll ever occur either. But what important to me is that we haven't put the infrastructure in place to take care of life while that is going on. And we have made recommendations and requests to this administration and to Mr. Ron, why don't we look at a loop road, if you want to call it, from Tejeras Canyon through the Tejeras of Royal, which is on the south side of Albuquerque over the state land, and it was hardly any homes there. I often connect with I-40 on the other side of my mile hill and build that first before we get into the big guy.

The other concern about the big guy is the $250 million expenditure, and it's only going to improve its efficiency by 25,000 vehicles a day. It's predicted that Albuquerque will have about a million people by the year 2015. I mean, in 12 years, well, improving that by 25,000 vehicles a day is still going to keep us wrap presently, and I don't see any real planning, and we can't afford to waste our resources in that fashion. We need a loop. We need to have that in place to make sure that we can get people and commerce to their jobs and goods to the stores. And 44, what can I tell you? I think the recent articles and the newspapers have raised real serious questions of what occurred in that particular regard, but this guy has been operating under a blind trust as he took office, not only in his business, which he knows everything about, but he's also had enough credibility with the people in New Mexico that they blindly trust him and everything else. And we are going to be questioning his accountability and responsibility in these actions, because I think that there are serious questions that have been raised, and they're going to

have to be looked into, and this guy will be held accountable and responsible. And my run, we keep talking about the contract, you know, this thing is up and rolling. They haven't, he had the bidders come in yet for the big eye contract, have they? No. I think that they will be issuing, I think they let the bids out, but they haven't decided who the contractor is going to be. But I think it was an interesting analysis, if this was completed in New Mexico in 24 months, they would break every prior record ever achieved by any contractor in the United States of America by four months. And if you remember the remarkable job that the contractor did in Los Angeles after the earthquake there, I mean everybody just sat there with their mouth open and said, wow, I mean, it was just amazing. Well, you only do better than that. I think somebody like and did the same that we would be rebuilding the Carlisle I-40 interchange which took 12 or 13 months, once every eight weeks for 13 times during the 24 months. I mean, once every eight or 10 weeks, we'd be rebuilding something that took 13 months

to build. I mean, so it's pretty hard to believe, but you know what, you know, Peter Robinson insurance agent, you know, how they make things sound, you know, if you just buy this, all things will be good at the end because if it doesn't work out, you know, he bought us an insurance pilot, I would hate to venture what the commission is on that, but there is something I respect the models that he used to be an insurance agent and I hope that he models good insurance. Constitutional question, if I read the proposal correctly, if the contractor, whoever that might be on the big eye project, finishes within two years, there is talk about giving them a $7 million piece of property. It's actually three or four piece parcels of land that are involved in that I think it's over between $7,000,000 million, including the northwest corner of the big eye, with springer. And most people don't remember, that's the old springer cement plant down there, hasn't it? It's over between $7,000,000,000 million worth of land.

Is that constitutional to, doesn't that come under the, you know, don't we have a prohibition against the giving of monies like that too? You know, I think that it is constitutional because it's a contractual relationship and it is given, in some instances, it's an incentive to get people, get the job done and the big eye and all these things are very important as you pointed out and we're all very skeptical as what is going to happen. But it can be contractually done and whether or not we're giving a good bargain or two going to bargain is something else, but yes, it can be done. And in the days when they had the Lloydsburg road problems, the contractor and that project was Jack Adams. You were little boy in those days and Adams told me at the time, he said, the real problem I had was putting the road through Lloydsburg, it was raining. We had bad weather, we just talked about the bad weather and the community and the state was pushing him to get on and off that project. Well, it is not good management to build the road when the weather is bad.

So we pushed that through and it looked bad, looked a little sloppy, you know, we paid for that dearly. What we have done on this though, we're setting it up almost in reverse that if we get to the part where the weather is bad and you're dealing with a contractor or a group of contractors telling them, what you're saying, if you don't finish this in a hurry, if the weather is bad, you're going to lose 7 to 11 million dollars. That is the one big weakness I see with this contract. Well, it is always an incentive to take shortcuts and whether or not you'll still meet the specifications of the aggregate or the seamet that you're going to use and the testing that is necessary to be done or if you do a big pour and you find that it was not the right mix to take it out, absolutely right. There are real serious concerns when you do that and this isn't about setting a record. This is about putting in place infrastructure with limited resources that the state has

that is going to last us for a long time and it's going to meet the needs of our citizens and we fail to talk about because they don't have enough money to put in the technology necessary for Albuquerque that will give you the technology in the future that when the Tahiris Canyon is closed because of snow, you know, start telling you that at the top of 9 mile hill, truckers make plans, you're not the highway, you're not going, now we put two state cops at the, at the Mouth of Tahiris Canyon and it's not till the first trucker gets yours and you're not going and then they line up all the way back. We don't even have the money to do that kind of technology. They want to cut back on the landscaping. I don't see that as being an unimportant, that is a reflection of who we are and what kind of pride we have in our community and in ourselves and people go through that. I go through some, and you've been through some pretty significant intersections in Arizona and California and go like, ah, what a beautiful, I mean, the atmosphere, I mean, there's roles, but it looks different. I mean, it gives you a sense of pride and people have it together.

No, we're going to leave it there and who knows what kind of tools and boxes we'll leave around, I guess afterwards, because we know we can't do it right. It makes people can do it right and in our highway department, we're going to demand that they do it right. In fact, I think there's a real strong feeling this year that the legislature will start stating specifically what projects that's appropriating money for and the highway department is going to have to follow that lead. Yeah, there are other projects that were put on hold, there's I recall. Questions? You were quite critical of, and among others, gentle, Billy McKibbin, Chainsaw McKibbin of the Motor Vehicle Department, and the, I guess it was the Board of Finance that gave about $166,000 to the Motor Vehicle Division to operate at least to the end of this session, but the total figure was more than $700,000. That's a shortfall from the last time. Did I read it right again that you did not say no, they would not try to come up with

the money, but you were critical about how they got into the spot. Can you explain for us? One of the charges that we have is not just always looking at the money, we're also looking at management techniques and let innovative ideas, and what are we paying you for? I mean, we need risk takers, we need people involved all the way to the front lines and asking, what can we maybe insert 20 new computers in some of these field offices and have directions for people to actually access for the Motor Vehicle, whatever it is that they're trying to get done there, can you do some other innovative things, can you expand your hours and call in, can we expand our registration years, and if they don't have to come in so often? New Mexico is growing. We need more infrastructure. The problem with this is that this government has been trying to say that he can do everything within available resources, then when he finds out after an ill thought, poorly thought on a plan, that that is not possible, or then he turns around and tries to blame somebody else.

He's the one that let down the government and said we don't want any more employees. He did not request any more employees for Motor Vehicle. In fact, last year, the politics of what was going on before, this is that he wanted to create a whole new division to enforce mandatory car insurance, 22 employees. Let's take your said, we don't have the money, and besides that, that program wasn't going to work. He didn't ask for money from the Motor Vehicle Department. We gave him, well, he asked for less $46,000, yet he's over $700,000 over spent, and somebody's going to have to come forward, and first of all, show us what management changes they can make, what other innovative ideas they can come with to do better within existing resources, and then we'll look at it from there. But I can assure you, one thing, the risk that you're stating in Mexico is going to fund whatever it is necessary to get to its citizens, the licensing that is required of them to have to operate in state roads. You haven't said no. You haven't said no to that, because there's another issue in the face of much criticism from U.S. Senator Pete Domenici. It's really taken a Democrats off the spot on it, but General John Dendo is criticized

the governor for getting on his program of drug legalization and decriminalization. I have said that, you know, even though the governor keeps talking to groups about that, the cage is spinning, but the hamster is dead. That's not going anywhere in this session, isn't it? No, I don't think that it's going anywhere. In fact, I'm understanding that there have been some Republican members of the House, excuse me, have actually are trying to start a new initiative to even do away with the Lind Pearson program, which is, you know, in Mexico, led in that particular aspect of it. When we created the Lind Pearson program that would provide for the use, medicinal use of marijuana for treatment of chemotherapy and assisting in treatment of chemotherapy and for glaucoma, because it had been proven that it assists in that particular regard and stops the nausea when someone is getting the chemotherapy, it gives them an appetite and it strengthens them, which gives them more opportunity to get more chemotherapy perhaps

to either right. And in glaucoma, it resters the pressure on the eye and people will not go blind. We did that years ago and funded it for about 150,000, and it's always been a little controversial in your Mexico. For the last few years, we haven't funded it at all. Somebody wants to take that off the books, and I don't think that'll occur. Let's stay on the books. It's on the books now. Sure. Except without the funding. It's not the funding. And I think that we're not looking at it again, because in a house there's another issue. But if it's something that's in an house, somebody's quality of life and perhaps an opportunity to live, I ain't playing that with anybody. I'm embarrassed at times like this, because we go, you start listening to questions. These are all priorities. None of these cannot be addressed this session in the minutes we have left. What do you think? What do you think will be overlooked in a day like today with the session just about one month away? You know, we still have a real deep interest in concern about our educational system here in the state of New Mexico.

We have a task force, a very dedicated citizen, a legislator that has been meeting 64 and number of facts. And I'm going to come up with some short-term solutions. I would hope that the governor would, I think, be with him later on today. In fact, at least give him the courtesy and the respect that these business people and the interested folk with the work product that they come up with and we look at it closely. We need to read about a little bit, much more accountability and holding teachers responsible for their work outfits. If we're going to continue raising their salaries, there's going to have to be continuing education and other things that have to come in to play to assure that our kids get the best education possible. Our correction system leads us to say I disagree with the governor, it was not in the... He said it's the best in the country. Well, I mean, you know, just I guess you know, take the source from that. We have serious problems every state and every country and every civilization would be better off without any corrections whatsoever, but we're always going to be with us.

We got serious problems early. You remember them from 1980 and when we went through there and thanked God, nothing like that's happened again, but we've had numerous opportunities to fix the system. It's time to fix it and make it... Because we will always possibility to the citizens of the Mexico and when someone comes out of prison, we're going to come out, somewhat be rehabilitated and less, hopefully less, probable that they will not hurt to do any other crime and we need to strengthen that. So, prisons are a great concern of Medicaid and health care in Mexico, still a very serious problem. Our welfare to work has recently reported into this governor's watches last in the nation. I just think we have a real test before us and frankly speaking, I think this administration is getting more isolated and the more isolated there's a real serious question in my mind of the state and the Mexico and the citizens kind of forward to continue that type of policy into the future.

We're looking at it for three years then. He has those three more years to this term. Do I detect that you're not optimistic about what's going to be happening for this three year period? I am very, very concerned on all the issues that we've discussed today, not only I, but other. I'm not a New Mexico, it's our highway projects, our prisons, our education, our gambling situation, the poverty, the, you know, even if the legislative suggests we need more prevention and intervention for our kids, the governor says no. I mean, we're not in out war with our children in this country and in this state. I mean, it's kind of things have changed, I mean, you know, and then we talk about family values and concern and, you know, we have to start paying attention to this and start turning things around as long as we wait. The worse it's going to get, so I'm hopeful that early that we'll be able to turn that around and hopefully we'll be able to time see a real considerable positive change in your Mexico, but I don't see it happening under this administration.

We may have to go back to doing five legislative shows a week as we used to. I'm Ernie Mills, I'd like to thank our guest today, the Senate president, pro-10 of the state legislature, many Erragone, for being with us and thank you for being with us on report from Santa Fe. Report from Santa Fe is made possible in part by a grant from the members of the National Education Association of New Mexico, an organization of professionals who believe that investing in public education is an investment in our state's economic future. Thank you.