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UPDATED: State Board of Finance OKs New Fairgrounds Casino Lease

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SANTA FE — A state board led by Republican Gov. Susana Martinez approved a new 25-year lease Tuesday with the Downs at Albuquerque that will allow the construction of a larger casino at the state fairgrounds.

The state Board of Finance unanimously approved the lease deal to let the Downs continue to operate a horse racing track at the fairgrounds in Albuquerque and build a new casino, which is estimated to cost $20 million and will have twice as many slot machines as a current establishment.

Martinez, who serves as board president and appoints a majority of its members, voted for the lease, as did Lt. Gov. John Sanchez.

Martinez’s political committees have received at least $75,000 in contributions, including $5,000 to the governor’s PAC in July, from individuals connected to the Downs and another New Mexico racetrack in which two Downs owners have an interest, according to state campaign finance records.

“The governor is confident that the state fair received the best deal as the result of a competitive bid process that ensured no one received preferential treatment,” Greg Blair, a spokesman for Martinez, said in a statement.

The Downs has leased fairgrounds property since 1985. It was one of two companies that responded to a request for lease proposals from the fair, which is known as Expo New Mexico.

Dan Mourning, the fair’s general manager, told board members the lease was a good deal because it provided more money to the fair in exchange for letting the Downs use a smaller parcel of land.

The current lease, which expires next month, provides for rent of $2 million a year. The Downs will pay $2 million in 2012 and 2013 under the new lease and then rent will increase to $2.75 million. In addition, the Downs will pay a share of its gambling revenues to the state fair, which doesn’t happen currently.

The track and casino’s current lease provides at least one-fourth of the revenue that pays for fair operations, and Mourning said it would be “virtually impossible” to continue the fair without money from a new lease.

At the end of the 25-year lease, the fair will own the new casino building.

Under the new lease, the Downs will be responsible for renovating the fairgrounds grandstand, and building a new entrance to the fair and new offices for fairgrounds maintenance operations, including underground gasoline storage tanks. The Downs also will start paying for utilities of the leased facilities, saving the fair about $300,000 to $500,000 a year, according to Mourning.

The State Fair Commission approved the new lease last month, but critics say the proposal was rushed through.

The fair requested lease proposals in July and gave companies 30 days to respond, which board members were told is about the average time for state procurement deals.

Three men own the Downs — William Windham of Bossier City, La.; John S. Turner of Shreveport, La.; and Paul Blanchard of Albuquerque, who is a close friend and political fundraiser for former Democratic Gov. Bill Richardson.

As part of the board’s vetting process, the owners were asked to submit sworn statements indicating whether they have been the subject of any federal or state investigation and testified or been subpoenaed by a grand jury.

Blanchard said in his affidavit that he has agreed to meet with federal law enforcement officials as part of an unspecified investigation, but “I do not believe I have any relevant information.” The affidavit included an email from a federal prosecutor saying Blanchard is considered a witness but not an investigation target.

Martinez told board members said she believed it was an ongoing federal grand jury investigation of Richardson. The former governor is being investigated for possible campaign finance violations for raising money while he was a presidential candidate in 2007 for a settlement with a woman with whom he allegedly had an affair, according to published reports.

To alleviate possible ethical concerns, Blanchard has agreed to put his Downs ownership shares in escrow and not participate in the management of the track and casino, said Downs lawyer Pat Rogers. Blanchard will forfeit his ownership shares if he later becomes the subject of any state or federal investigation, is indicted or pleads guilty, or becomes a witness who testifies in exchange for immunity from prosecution, according to an agreement among the Downs owners.

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Dec. 20, 2011 3:40 p.m.

By Barry Massey / The Associated Press

SANTA FE — Republican Gov. Susana Martinez and a state board approved a new 25-year lease Tuesday with the Downs at Albuquerque that will allow the construction of a larger casino at the state fairgrounds.

The state Board of Finance unanimously approved the lease deal to let the Downs continue to operate a horse racing track at the fairgrounds in Albuquerque and build a new casino, which is estimated to cost $20 million and will have more than twice as many slot machines as a current casino.

Martinez, who serves as board president and appoints a majority of its members, voted for the lease as did Lt. Gov. John Sanchez, her running mate during last year’s campaign.

The Downs has leased fairgrounds property since 1985. It was one of two companies that responded to a request for lease proposals from the fair, which is known as Expo New Mexico.

Dan Mourning, the fair’s general manager, told board member the lease was a good deal financially for the state, providing more money to the fair in exchange for letting the Downs use a smaller parcel of land.

The current lease, which expires next month, provides for rent of $2 million a year. The Downs will pay $2 million in 2012 and 2013 under the new lease and then rent will increase to $2.75 million. In addition, the Downs will pay a share of its gambling revenues to the state fair, which doesn’t happen currently.

The track and casino’s current lease provides at least a fourth of the revenue that pays for fair operations, and Mourning said it would be “virtually impossible” to continue the fair without money from a new lease.

At the end of the 25-year lease, the fair will own the new casino building.

Under the new lease, the Downs will be responsible for renovating the fairgrounds grandstand, build a new entrance to the fair and new offices for fairgrounds maintenance operations, including underground gasoline storage tanks. The Downs also will start paying for utilities of the leased facilities, saving the fair about $300,000 to $500,000 a year, according to Mourning.

The State Fair Commission approved the new lease last month but critics say the proposal was rushed through.

The fair requested lease proposals in July and gave companies 30 days to respond, which board members were told is about the average time for state procurement deals.

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Dec. 20, 2011 2:20 p.m.

By Barry Massey / The Associated Press

SANTA FE — A state board has approved a new 25-year lease with the Downs at Albuquerque allowing the construction of a larger casino at the state fairgrounds.

The state Board of Finance unanimously approved the lease deal on Tuesday that provides for the Downs to continue operating a horse racing track at the fairgrounds and build a new casino estimated to cost $20 million.

Gov. Susana Martinez voted for the lease.

The Downs has leased fairgrounds property since 1985. It was one of two companies that responded to a request for lease proposals from the fair, which is known as Expo New Mexico.

The fair’s general manager told the board the lease is a good deal for the state, providing more money for letting the Downs use a smaller parcel of land.

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Dec. 20, 2011 5:57 a.m. — Board To Review Fairgrounds Casino Lease

By The Associated Press

SANTA FE — A state board plans to consider a new 25-year lease with the Downs at Albuquerque that will allow the construction of a larger casino at the state fairgrounds.

The state Board of Finance is scheduled to meet today and is being asked to approve the lease for the horse racing track and a proposed $20 million casino.

Gov. Susana Martinez serves as the board president.

The State Fair Commission approved the new lease last month but critics say the proposal was rushed through.

The Downs has leased fairgrounds property since 1985. It was one of two companies that responded to a request for lease proposals from the financially troubled state fair, which is known as Expo New Mexico.

The Downs’ current lease expires next month.

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