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Expo Casino Selection Rushed?

The Expo New Mexico Downs grandstand in 2008. The state is considering two proposals for a new casino at the State Fairgrounds in Albuquerque.
The Expo New Mexico Downs grandstand in 2008. The state is considering two proposals for a new casino at the State Fairgrounds in Albuquerque.
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At least two New Mexico State Fair commissioners are questioning the process that will determine whether the Downs at Albuquerque or Laguna Development Corp. will be allowed to build a multimillion-dollar casino at Expo New Mexico and operate it for the next 25 years.

“The process that was used, we think, was inappropriate,” the commission’s newest member, Charlotte Rode, said at a recent public forum held by area neighborhood associations.

“We have concerns, and we have a lot of questions,” she said.

Specifically, Rode and Commissioner Benny Roybal criticized the fact they will not get to review the proposals submitted, but rather will be faced with an up or down vote on a contract already negotiated with Expo staff. They also said potential bidders weren’t given enough time to submit proposals.

Rode said Interim General Manager Dan Mourning and attorney Mark Shoesmith have been negotiating a lease with one of those entities since Sept. 25. Mourning has declined to say which, but the Journal has learned that the talks have been with the Downs at Albuquerque.

Other commissioners, including Chairman David “Hossie” Sanchez, say they’re comfortable with the process.

“It’s my understanding that it’s going through normal procedures of state procurement, and when they (Expo officials) get through with it we’ll look at it,” said Kenneth “Twister” Smith of Caballo, another newcomer to the seven-member, governor-appointed commission.

On July 24, Expo New Mexico issued a 100-page request for proposals for parties interested in leasing 93 acres at the fairgrounds for 25 years. It gave responders until Aug. 25 to submit detailed proposals.

Two companies responded: The Downs at Albuquerque, which has held the lease since 1985; and Laguna Development Corp., which operates Route 66 and Dancing Eagle casinos west of Albuquerque for Laguna Pueblo.

Both propose a new casino. The Downs wants to build a $20 million, 52,000-square-foot casino about 550 feet north of Central, and about 650 feet west of Louisiana – a plan first proposed by majority owner Paul Blanchard in 2004 – and to pay Expo $2 million a year in lease payments.

Laguna Development hopes to build a $30 million, 36,000-square-foot casino at the south end of the Downs’ existing grandstands. It would pay Expo $2 million in its first year of operation – the same base rate the Downs has paid for years – and $2.5 million the second year. From then on, it would pay Expo $3 million annually.

Gov. Susana Martinez appointed three people to evaluate the confidential proposals and make a recommendation to Mourning, a Martinez appointee, and Shoesmith. The three appointees are Chuck Gara, director of the Property Control Division of the state General Services Department; John A. Garcia, director of the city of Albuquerque’s Economic Development Department; and Garrett Hennessy, former intergovernmental affairs liaison for Mayor Richard Berry.

Once a contract is hammered out, it will be presented to the State Fair Commission for a vote.

Rode and Roybal said they’re uncomfortable with that process.

“We (commissioners) won’t be seeing the responses to the RFP,” Rode said. “We won’t be seeing the best-and-final offers. We will only be seeing the lease, and be asked to vote on it.”

Rode and Roybal, an EspaƱola contractor who has been on the commission since January 2007, also said 31 days to respond to such a detailed RFP was insufficient. Rode said she has spoken with other potential bidders who said they didn’t have enough time to respond. She pointed out that when the New Mexico Racing Commission solicited bids to build and operate the state’s sixth racino, the process took three years – and is still incomplete.

Roybal agreed and said he wished the commission had been involved in developing the RFP and evaluating responses.

“When you don’t have much input and then you’re expected to approve it, it’s difficult,” he said.

“We’re not a rubber stamp,” Rode said. “None of us on the commission want to be, nor will be, used as a rubber stamp.”

Besides Chairman Sanchez, three other commissioners – Smith, Ruth Bitsui of Corrales and Larry Kennedy of Albuquerque – said they had no specific concerns with the process.

Commissioner Kenneth “Buster” Goff, a Hobbs-area farmer and rancher, did not return phone calls seeking comment.

As a state enterprise fund, Expo must pay its own way – a task virtually impossible without the lease payments on the racino property. Though the Legislature does not fund Expo, it provides capital outlay money to maintain and improve the facilities. That funding, however, has fallen far short of the 75-year-old fairgrounds’ needs.

At the commission’s Sept. 1 meeting, Expo director of administration Agnes Maldonado said the fairgrounds’ 2010 deficit was $1.9 million, and this year’s deficit is about $2 million.
— This article appeared on page A1 of the Albuquerque Journal

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