Guv appoints new racing commission

ALBUQUERQUE — You can’t change horses midstream, but you can change the state’s horse racing commission before it picks a new racino licensee.

That’s what Gov. Michelle Lujan Grisham did last week.

In the latest sudden development to the contested process since last year in awarding the state’s sixth racino license, the New Mexico Racing Commission has an all new lineup as of Thursday.

Previous NMRC Chairman Ray Willis told reporters he learned Wednesday evening via email that he’d been terminated from his position. The next morning, the commission canceled a special meeting to “review all options” concerning the delayed decision on which of five sites around Clovis, Tucumcari and Lordsburg would win the bid for a horse racing/slot gaming project.

Lujan Grisham’s deputy press secretary said the word “terminated” was an “overly harsh” way to describe a “customary practice” of a new administration.

As Nora Meyers Sackett explained, “during the changeover between administrations, commission membership is examined for continuity’s sake and new applications are accepted.”

Willis told The News on Friday that he filled out an application to be reappointed to the commission in January “and heard nothing from them” until receiving an email Wednesday night “that said the governor was relieving me of my duty.” Willis was with the commission 13 years, appointed by Bill Richardson and later re-appointed by Susana Martinez. He said the appointment this month of new commissioners surprised him “because normally if they’re going to change out the commission they do it early after the governor is sworn in.”

NMRC Executive Director Izzy Trejo spoke Thursday morning to “fast-moving developments” and by that afternoon conveyed to The News a release from Lujan Grisham announcing the new lineup.

“Fair and equitable regulation is my expectation for this commission,” she said in the release. “These five individuals are experienced and knowledgeable, and I have every confidence they will ably regulate and promote the continued development of this industry.”

That release did not address any reason for the timing of the selection of a new commission, but the governor remarked in January that she had concerns with the license award process and a feasibility study comparing the proposals.

The governor’s director of communications said the request for a new feasibility study “was never delivered to her satisfaction” and that it was primarily the legislative business occupying her in the first months of this year that influenced the timing of the new appointments.

Tripp Stelnicki said Lujan Grisham “expressed some concern earlier this year and requested a new and more thorough review of the feasibility of a potential sixth track, which was aimed at sort of cutting through the clutter of the process to date, so to speak.”

As for the hammer dropping just days before the commission’s special meeting on the racino selection, Stelnicki said that had more to do with the governor’s schedule opening up than anything else.

“Not to imply any one order of business is more important or worthy of attention than another, but with the legislative session and bill-signing period at last completed this month, we have been more free to turn our full attention to appointments and other essential business,” he wrote. “That, more than anything else ... speaks to the timing aspect.”

Hidalgo Downs, LLC, and other plaintiffs affiliated with Lordsburg’s racino bid filed a petition for injunctive relief late last year, a move that delayed what was forecast to be a racino decision before the end of former Gov. Martinez’s term. A representative for the attorney general’s office said the commission would wait until the court action was resolved, as they didn’t want their decision to be “tainted” by the pending litigation.

That case also took issue with an alleged conflict of interest between Willis and Shaun Hubbard, a chief stakeholder of one of the three candidate projects for a Clovis racino. Both men told The News that it would be difficult to spend as many years as they have in the state’s horse racing industry and not cross paths with one another.

“I have been partners with hundreds of people on hundreds of horses. I’m not a newcomer in this business,” Willis said. “My integrity is good and I take umbrage to someone saying it’s not.” Willis also called the Hidalgo Downs suit “completely unnecessary.”

Hubbard on Thursday told The News he has “great appreciation for (Willis) as a friend” but that building relationships was inevitable in the industry.

“What people are quick to forget is that this is a regulated industry. As a licensee, you adhere and work with your regulators, so if I didn’t have a decent rapport with the commission or with any of the commissioners then I wouldn’t have done my job as a licensee,” Hubbard said.

A motion to hear a settlement negotiated between NMRC and Hidalgo Downs came to court early this month but was opposed by representatives of other applicant groups.

Warren Frost, representing Tucumcari’s bid, told The News at the time that his concerns with the selection process had only grown in recent months and that he believed a new study and new batch of commissioners were necessary.

Following a closed executive session in its regular meeting last week, NMRC announced it had approved an agreement with Hidalgo Downs, LLC. Commissioners did not comment at the time but to announce the forthcoming special meeting, which was canceled Thursday morning amid the abrupt recent changes.

It wasn’t clear how the appointment of an entirely new racing commission would impact the racino award process, but the previous timeline for site visits, a feasibility study and ensuing court action has taken over eight months from the time that applications were received.

Trejo did not answer questions Friday as to what was next for the commission, but NMRC’s website showed its next meeting scheduled for May 16. Sackett said that “where, when and whether a sixth license will be awarded” is up to commissioners, not the governor.

“I’m sure the new commissioners will look at everything, probably take them some time to decide whether to issue it or not,” Willis said. “(If not), I would anticipate there will be lawsuits, because it was voted in a public session to continue the process. We accepted the applicants’ applications, it cost them hundreds of thousands of dollars to put that in and I could imagine that they’re quite upset if it’s not issued. Now, if it’s issued and they lose, that’s another thing.”

As to the recent developments and the new uncertainties for a sixth racino, Hubbard said “things happen and time moves on,” but he recommended optimism.

“I feel for all of the regions of the state and the state in general, because of the fact that (the license) hasn’t been issued, because it’s a loss of job opportunities in a very critical time in our state’s history. It’s a loss of revenues and quite frankly it’s been a delay or a loss in the progression of what could be the most lucrative horse racing state in the United States if it were steered in that direction,” he said. “I would say, to some of the local communities that had applicants vying for a racetrack, to not get discouraged.”

The five new racing commissioners, as announced Thursday by the governor, are Beverly Bourguet, John Buffington, Freda McSwane, David “Hossie” Sanchez and Billy G. Smith. The commission will appoint one among them as chair, and while that’s not the governor’s decision, Stelnicki said “for whatever it’s worth, the governor feels Beverly Bourguet would be an excellent choice.” According to the release:

n Bourguet is a board member and founding member of the Downs at Albuquerque Chaplaincy. She was an NMRC member from 2011-15, raises quarter horses and races quarter-horses and thoroughbreds.

n Buffington has more than 40 years of experience as both an owner and breeder. He was chief operating officer of the San Juan Regional Medical Center from 2006-17.

n McSwane “has been active in the racing industry for many years” and is “an active owner and breeder of racehorses.” She is a practicing attorney in Lincoln County.

n Sanchez was on NMRC from 2003-2009 and has been on the State Fair Commission since 2009. He is the owner of San Bar Racing LLC and president of San Bar Investments and San Bar Construction Corp.

n Smith owns a construction firm (Smith Enterprises, LLC) and “has been involved in the racing industry since the 1970s as an owner and having served on various boards for the American Quarter Horse Association.”