A bill that would require competitive bidding on all State Land Office development leases was the only legislation in a package of proposals made by three Las Cruces Democrats to gain approval in the session that ended Saturday.
Senate Bill 540, sponsored by Steve Fischmann, is now awaiting action by the governor. The bill was a mirror of House Bill 606, sponsored by Jeff Steinborn, who along with Fischmann and Rep. Nate Cote pushed the package of bills in response to a development controversy in Las Cruces.
“Given the problems we’ve had with the State Land Office, and the unchecked opportunity that office has to arbitrarily develop state lands, it was important that we close this loophole,” Steinborn said in a news release about the passage of the Fischmann bill. “This reform will ensure that any developer who acquires state land for development does so through a competitive bidding process, and not through insider connections or big campaign contributions.”
Fischmann said in the release that he was “proud to be a partner in this legislative effort to protect New Mexico’s treasured public resources while also protecting our schools’ financial bottom line. This is great public policy that will make the state millions of additional dollars in future years.”
The transparency and accountability proposals followed Attorney General Gary King’s finding fault last year with Land Commissioner Pat Lyons’ leasing of land on Las Cruces’ East Mesa to Philip Philippou so it could be developed. The AG’s formal opinion on The Vistas at Presidio land deal states that the lease agreement’s method of compensating Philippou’s company for developing the land is “not comprehended by and in conflict with” a statute that allows developers who improve land for the state to be compensated only for the appraised value of the improvements.
In the lease, the land office also agreed to compensate Philippou for other project costs and 40 percent of the change in value of the land as a result of the improvements.
The competitive bidding bill was significant because, in the Las Cruces situation, Lyons bypassed his own bidding process — which he’s not currently required by law to use — and leased the thousands of acres of land in question to Philippou in December 2006. Months earlier, while the Republican Lyons was running for re-election, Philippou gave $20,500 to a political action committee run by lobbyists he employs. The PAC gave most of it to Lyons’ campaign, and the lobbyists gave another $3,600. After Lyons leased the land to Philippou, the developer gave another $6,000 to Lyons.