ALBUQUERQUE, N.M. — Copyright © 2014 Albuquerque Journal
The texts from Gov. Susana Martinez’s political adviser, Jay McCleskey, lit up Andrea Goff’s cellphone on the evening of Nov. 9, 2011.
“Buster screwed us,” read the first message to Andrea Goff, a Hobbs-area fundraiser who at the time was working for Martinez and McCleskey, raising money for SusanaPac. She is also the daughter-in-law of then-State Fair Commissioner Buster Goff, who had cast the key vote that day to delay approval of a new 25-year racino lease with the Downs at Albuquerque.
“He has just really hurt the governor,” McCleskey wrote. In a later text he said, “The gov is furious … It is VERY bad.”
McCleskey appeared to be in full crisis mode, texting Goff as he returned from a kayaking trip near Taos.
Neither he nor Andrea Goff had been at the fair commission meeting in Albuquerque that day, and Andrea Goff, at home near Hobbs, didn’t seem to know what had happened to set McCleskey off.
“For real?” she texted in response to the “Buster screwed us” text. “How what happened?”
The text exchanges continued into the night, and with each one McCleskey continued to dig a hole the Martinez administration is still trying to dig out of.
Andrea Goff said in an interview with the Journal that, as the texting continued, she felt she was being pressured to somehow get her father-in-law to change his vote. She said she didn’t try to do that, but that she did try to find out from Buster Goff what happened and what his reasoning was. Buster Goff, who was a Martinez appointee to the commission, has said he had concerns about some aspects of the lease and that, once they were addressed, he changed his vote for approval.
McCleskey said he was not trying to pressure Andrea Goff.
“Conversations about the political impact of controversial situations like this between myself and (Andrea) Goff were not unusual, and it went both ways,” he said in an a recent Journal interview.
“In this case, I was out of town, had very little information about what had happened, and was privately expressing my concerns to a colleague based on the very limited information I had at the time. Being concerned about a public spectacle orchestrated by opponents, or worse, the governor being blamed for the State Fair shutting down, is the kind of public relations fallout political consultants seek to avoid. The winning bidder on the lease had already been selected long before, and my supporting a lease the administration had negotiated and was advocating is not surprising.”
McCleskey’s texts to Andrea Goff continued to focus on the political fallout from the commission’s approval of a two-week delay in voting on the racino lease.
“These 2 weeks will not be used to study the proposal … they will be used to kick the crap of the gov,” McCleskey wrote. “That’s what he (Buster) needs to understand.”
Another text read: “Windham (one of the Downs’ owners) will be a piñata for 2 weeks. … He (Buster Goff) was supposed to pass it.”
Andrea Goff is not a political novice and has worked for Republican candidates. She had not worked on the Martinez campaign, but was brought onto the Martinez team after the election in November 2010 to raise money and organize the inaugural celebration for the governor-elect. She stayed on to work for Martinez’s political action committee, SusanaPac, which is run by McCleskey.
When she asked for talking points to raise with her father-in-law, McCleskey laid them out, focusing on the prospect of the State Fair going bankrupt without the lease.
After talking to Buster Goff, Andrea Goff defended his vote, saying he and other commissioners were concerned with performance clauses in the lease.
“They want to be good public servants for the gov and the state but did not know they were just supposed to be a rubber stamp,” she wrote.
Later in the texts, she said Buster Goff offered to resign.
McCleskey ignored the offer and continued on about how Democrats in the state Senate wanted to embarrass Martinez. He predicted dire financial consequences for the State Fair if the lease was not approved.
Insiders, contributions and appearances
Martinez critics say the Downs at Albuquerque contract was a pay-to-play deal, reminiscent of those alleged during the administration of her predecessor, Gov. Bill Richardson – a claim heatedly disputed by the Martinez administration.
But machinations around the Downs lease do involve political insiders, significant campaign contributions and expressed worries about appearances that Andrea Goff construed as attempts to hide contributions from donors connected to the Downs – another claim rejected by the Martinez inner circle.
The FBI has investigated the contract, which was awarded to the Downs at Albuquerque in December 2011, with agents interviewing people involved with the Martinez campaign and others about the lease, including Andrea Goff.
The governor also answered FBI questions about the Downs as they related to an ongoing case involving emails allegedly stolen from her campaign.
In addition to the FBI, the state auditor has looked at the Downs lease and the state attorney general was asked to look into it.
There have been no charges or formal allegations of misconduct.
Over the past month, the Journal has reviewed texts, emails and state records the newspaper obtained involving the racino contract.
They provide insight into a new administration making missteps in the handling of the racino contract and the political appearances surrounding the deal.
They also show how aggressively McCleskey defends his boss and goes after people he views as potential problems or critics. And they attest to his involvement in the administration’s effort to deal with the lease, which is expected to be a part of the criminal defense for a former campaign worker charged with stealing Martinez emails from her campaign account.
Political players and transparency
The three Downs owners are all political benefactors.
New Mexican Paul Blanchard was a Richardson insider and a key fundraiser for the former governor. Louisianans Bill Windham and John Turner are Republican boosters and were substantial contributors to Martinez’s campaign. Martinez, in written responses to Journal questions, rejected any similarity to her predecessor in her administration’s approach to the Downs.
“Unlike the Richardson administration’s proposed 40-year, no-bid lease, my administration put the lease out for competitive bid and there has never been any credible argument against two central facts: The best bid was selected and the new lease the administration negotiated is better for the state than the old one.”
One Democratic state official knowledgeable about the bid said he saw no substantive problems and that the state got a better deal because it required competition. But he said there were ongoing problems with the “political optics.”
He said the more Martinez pushed for a transparent public bid procedure on what is often a closed sole-source process, the more criticism was leveled at the administration because more was known about it.
A key motivating factor to push the contract through appears to be the administration’s fear of the financial collapse of Expo New Mexico that would have required Martinez’s administration to go hat-in-hand to a Legislature controlled by Democrats for a bailout.
That would have left Martinez taking the blame for what a Legislative Finance Committee audit said was more than a decade of financial mismanagement at Expo New Mexico, which oversees the State Fair and relies on the racino contract to pay the light bill.
The LFC staff recently reported that the State Fair has paid most of its debt amassed during years of insolvency.
Partners and contributions
During Martinez’s 2010 campaign for governor, the racino at the State Fair operated by the Downs at Albuquerque wasn’t an issue. The governor said it wasn’t on the radar until after the 2010 election, when the Richardson administration attempted to give the Downs a new lease.
But she had received $70,000 in contributions during the campaign from people connected to the Downs, most notably Windham and Turner.
After the election, Windham asked for a meeting with Martinez’s transition team to discuss the future of the racino lease and offered to contribute $50,000 to the Martinez inaugural committee.
Andrea Goff, who was executive director of the inaugural committee, was instructed to turn down Windham’s offer.
In an interview, Andrea Goff said, “At the time, Jay (McCleskey) said they were in meetings with Windham and we shouldn’t take his money.”
Martinez said in her written responses to Journal questions that those meetings were not negotiations, but a normal part of the transition to discuss potential issues facing the incoming administration.
Almost a year later, turning down Windham’s inaugural contribution offer became an issue in the texts between McCleskey and Andrea Goff over her father-in-law’s vote to delay the final vote on the State Fair lease with the Downs.
McCleskey was making a case that Windham was different from his partner, Blanchard – whose name had surfaced in a federal investigation of Richardson over where the $240,000 came from to pay off a woman who accused the former governor of sexual harassment. The entire matter was handled in secret outside state legal channels.
McCleskey sent a text, “Windham is not Blanchard.” McCleskey in an earlier text had described Blanchard using a vulgar slang term that translates into “sleazy.”
Andrea Goff responded, her text message reading: “I know but you an I both know he’s (Windham) questionable thats why we didn’t allow him to participate at the inaugural so he’s not that clean o (I) love him but he’s not that clean.”
In an interview, she said she was referring to Windham being Blanchard’s business partner in the Downs and that the transition team was talking with Windham before the inauguration.
McCleskey responded, “No. We didn’t let him participate because the lease was being negotiated at that time and we didn’t want it to look inappropriate.”
McCleskey said in the interview that he was referring to the Downs negotiations with the Richardson administration.
Fundraising for inaugural events isn’t covered by state campaign laws, but Martinez had announced that contributions would be made public.
Between her election and taking office at the start of 2011, Martinez staffers learned that Richardson’s administration was negotiating a new lease with the Downs, and its then-lead partner, Blanchard.
That lease was for 25 years, with an option for another 15 years. But the deal fell through when two State Fair commissioners boycotted a Dec. 15, 2010, meeting to approve the deal, which had drawn a lot of public criticism.
Martinez said she decided even before taking office that the racino lease at the State Fair would go out to competitive bid, although it wasn’t required by law.
“My administration was always clear that we would never negotiate a no-bid lease like that,” Martinez said.
After the inauguration, Windham did make two $5,000 contributions to the Martinez campaign.
Martinez said the two checks were among hundreds processed during that time and that the unsuccessful negotiations between the Richardson administration and the Downs were over by then.
Going out to bid
The plan to put the lease out to bid got off to a slow start.
The existing lease with the Downs at Albuquerque was set to expire in January 2012, and no one had ever put a racino lease out to bid before.
Martinez appointed Albuquerque restaurant owner Dan Mourning to be interim executive director of Expo New Mexico, which runs the State Fair, in March of 2011.
Mourning said he took over the State Fair management with little or no information.
“The prior GM handed me the keys and told me I had to figure out a way to get out of $3 million in debt,” Mourning said.
Martinez later appointed four new members of the State Fair Commission, which would have to approve the bid documents – known as a request for proposal.
Windham was quicker off the mark, hiring longtime Republican Party attorney Pat Rogers of Albuquerque in February to represent the Downs. Rogers was one of two state Republican National Committee members and was a paid attorney for the Martinez inaugural committee.
Rogers said there was nothing unusual about his hiring.
“People know about my political background, but I also have extensive litigation experience in procurement issues,” he said in an interview. “I never had a conversation with Gov. Martinez about Windham or Turner.”
Martinez said she saw no conflict because the inauguration was over and Rogers was not part of her administration.
McCleskey confirmed that Rogers was one of a number of attorneys he consulted about setting up an alternative political action committee for Martinez in April 2011 but that he was not retained to do so. McCleskey pointed out that the political action committee was not formed until a year later.
Rogers said the Downs lease was a complicated process.
“State real estate deals are usually sole source,” Rogers said. “Putting it out to bid with the amount of transparency the governor insisted on was complex. No one had done that before.”
With time winding down and no RFP prepared, Mourning sought to buy time by agreeing to a one-year extension of the racino lease with the Downs. That move was criticized by state legislators who argued such an extension required legislative approval.
Martinez’s staff concluded the lawmakers were correct, but that seeking approval in the time left would have required putting the lease on the agenda of the special legislative session redrawing legislative districts. Martinez decided against seeking more time and told Mourning to put the lease out to bid, despite the time crunch.
Two bids submitted
The RFP process was criticized by commission members and Martinez opponents, in large part because it allowed only 30 days for submission of proposals for a complex deal. They said that wasn’t enough time, even though it complied with state procurement laws.
Only two responses – one from the Downs at Albuquerque and one from Laguna Development Inc., owned by Laguna Pueblo – were submitted by the end of August.
Mourning said the Expo New Mexico procurement manager determined both proposals were responsive – a key finding that meant each would be reviewed by the selection committee. People involved with the process said both proposals were better than the previous contracts the state had with the Downs.
In September 2011, the selection committee also determined both proposals were responsive, reviewed each, heard oral presentations and then received best and final offers from both parties.
The selection committee of three men, all with ties to the state Republican Party and/or McCleskey, scored the Downs proposal 15 points higher than the Laguna proposal out of a possible 1,000 points.
Two of the committee members – former general manager of the State Fair and longtime economic development executive John Garcia and Albuquerque businessman Garrett Hennessy, who worked for Mayor Richard Berry – signed affidavits for the State Auditor’s Office, which has looked into the lease, saying they had no contact with anyone in or connected to the Martinez administration in reviewing or scoring the lease proposal.
The third member of the selection team, real estate man Chuck Gara, who was working in the Martinez administration at the time, died before the Auditor’s Office asked him for an affidavit.
In October 2011, Mourning and the Expo New Mexico attorney began negotiations with Rogers, representing the Downs, to hammer out a final lease agreement. At the same time, the Legislative Finance Committee issued a scathing report on the operations of the State Fair and its business relationship with the Downs at Albuquerque during the Richardson era.
Windham would later admit to the Journal that the Downs was poorly managed in the past and promised to correct that.
On Nov. 9, 2011, the State Fair Commission was supposed to vote on whether to approve the lease.
Commissioner Charlotte Rode, a Martinez appointee who opposed the racino altogether, argued that she and other commissioners didn’t have enough time to review. She proposed having another meeting or a “workshop” to discuss the lease and wanted to delay it.
Buster Goff, who was not opposed to the racino, had concerns about the performance clauses in the lease and said he voted in favor of the delay, which passed on a 4-3 vote.
And that vote set McCleskey to texting.
The Journal asked to interview Martinez about the texts and other Downs-related matters.
She declined to be interviewed on the advice of her attorney because of her expected testimony in the trial of a man charged in federal court with stealing her emails. She provided written responses through her spokesman.
“There was a great deal of frustration with the political game-playing and dishonest tactics opponents were using and that included the stunt calling for a two-week workshop,” Martinez said. “I felt it was important that we not lose the State Fair, and given the impending expiration of the lease, it was critical that we have an agreement in place with an anchor tenant.”
Initially, Rogers and Mourning said, there was consternation about Buster Goff’s vote since he was considered a strong supporter of the State Fair.
But once they reviewed his concerns, they found they were reasonable, though they required some negotiations between the Downs and Expo New Mexico over language.
Two weeks later, with changes made based on his questions, Goff voted in favor of the lease, which passed 4-3. Two of those voting against it were appointed by Martinez.
In December, the Board of Finance, chaired by Martinez, approved the lease with additional changes.
Martinez said, “The Board of Finance put real teeth in the new lease.”
Laguna Development filed a protest over the lease, which was denied. It did not take its appeal to court.
There was less than a month left before the lease expired.
Under the new lease, the Downs is current on all its payments.
The money and politics questions regarding the Downs didn’t stop when the lease was approved.
Four months later, a text from McCleskey suggests how the Martinez political team might shield Windham contributions from public view.
McCleskey and Goff were texting about preparations for Louisiana Gov. Bobby Jindal’s appearance at a state Republican Party fundraiser in New Mexico. Windham was a member of Jindal’s political fundraising team.
According to the text messages, Andrea Goff wanted to know if they could ask Windham for a contribution to Reform New Mexico Now, a political committee that would push the governor’s agenda.
On March 13, 2012, McCleskey sent a text to Andrea Goff saying, “We should run Windham’s through a different PAC. That lease is under protest which is decided by admin.”
Andrea Goff said in an interview that she understood this as saying they take money from Windham but figure out how to keep it from public scrutiny.
McCleskey denies that and said the text was poorly worded. He said he was trying to say they shouldn’t seek Windham contributions because Laguna Development had filed a protest against the state awarding the lease to the Downs.
In April, after Windham received a fundraising letter meant for another member of Jindal’s fundraising team, McCleskey emailed Andrea Goff telling her directly, “We don’t want to solicit from Windham, Downs, etc.”
McCleskey said Martinez’s political organizations have not accepted contributions from the Downs or its owners since early July 2011, before the lease was put out to bid.