SANTA FE – Direct grants to small businesses and nonprofit organizations that are a hallmark of New Mexico’s coronavirus relief effort have been awarded to several state legislators as well as enterprises that have sued the state over Gov. Michelle Lujan Grisham’s aggressive public health restrictions.
Nearly $100 million in grants were paid out to 6,800 businesses and nonprofits at the end of 2020, illustrating the breadth of the economic distress brought on by the pandemic.
Public records obtained by The Associated Press show successful applicants included businesses overseen by five current or recent state senators, a family-oriented amusement park that has sued the governor as it seeks to reopen, numerous Catholic charities, local chambers of commerce and hundreds of struggling restaurants and hotels run by lone proprietors and business magnates.
Marquita Russel, CEO of the New Mexico Finance Authority that administers the grants, said a high priority was given to the hard-hit leisure and hospitality industries. Money ran out with thousands of applications still pending, she said.
“We were able to fund about 47% or 48% of all applications submitted,” Russel said.
Grants were awarded to businesses run by four Democratic state senators – Sens. Joseph Cervantes of Las Cruces, George Muñoz of Gallup, John Sapien of Corrales and Gabriel Ramos of Silver City. They recused themselves from voting in November on a bill that authorized the grant program, along with additional relief for the unemployed and immigrants without legal status.
Republican Sen. William Sharer of Farmington voted against the legislation. His debt collection business received a $15,000 grant.
Sharer said he objected to the economic aid on principle because he would rather see a repeal of public health restrictions that have forced the closure of entertainment venues, banned indoor dining and limited occupancy at many essential businesses. However, he said, the grant his business received meant “a couple more people stayed on the payroll.”
Cervantes, an attorney and chairman of the Senate Judiciary Committee, confirmed that his Las Cruces-based law office was awarded $15,000 and that demand for legal services has fallen off, like much of the economy.
“I think we’ve done a good job in making sure it reaches all parts of the state and doesn’t show any bias,” Cervantes said of relief. “I have heard from some businesses that didn’t qualify and are disappointed, and I’m disappointed for them.”
Muñoz said he recused himself from voting in November because it might benefit his 20-employee construction company and a residential property company overseen by his wife. The property company forwarded information about rent payment subsidies to its trailer-park tenants, he said.
His construction company had to expand its payroll along with other pandemic-related costs so the $15,000 grant came in handy, Muñoz said. He brushed off the idea of any personal financial motives.
“I’m still driving the same truck. I’m still wearing the same boots,” Muñoz said.
Sapien, whose insurance business received $10,000, has retired from the Legislature. Ramos, whose Silver City-based business received $10,000, lost his Democratic primary election bid.
Top-ranked Democratic legislators have placed new economic relief measures at the top the agenda for a 60-day session that convened Tuesday. Prominent relief proposals would ease the repayment terms of a low-interest loan program for small businesses that draws on a multibillion-dollar trust fund. The program has loaned about $40 million – out of $400 million made available.
Sen. Jacob Candelaria described the proposed loan changes as “very, very generous and designed to get the money out the door and get people to use it.”
Lawmakers also want to pay down by $300 million the state’s growing debts toward unemployment benefits to avoid future payroll taxes on businesses.
Colin Keegan, founder of artisan distillery Santa Fe Spirits, missed out on getting a grant. The business has temporarily closed a tasting room in downtown Santa Fe and laid off half its staff, while distilling alcohol-based hand sanitizer to try to survive financially.
“That’s shocking that legislators are taking the money,” Keegan said. “I don’t know everyone’s situation. It doesn’t sit well, I can put it that way.”
At least six businesses received grants as they were suing the state for compensation, arguing that health restrictions constitute a regulatory “taking.” The state Supreme Court is weighing whether to let the lawsuits proceed.
Attorney Blair Dunn, who represents plaintiffs including Hinkle Family Fun Center, says the businesses have an obligation to pursue available public aid despite their ongoing cases. The amusement park received a $50,000 award.
Grants also went to oil-field companies and solar installers, the Georgia O’Keeffe Museum in Santa Fe and the Billy the Kid Museum in Fort Sumner. Donut shops to four-star restaurants were among the eateries to get money.
Grants worth $338,000 went to 14 businesses associated with Gerald Peters – an art dealer and philanthropist with diverse real estate and business holdings in Santa Fe that are major sources of employment. That includes the Rio Chama Steakhouse, which is frequented by legislators and lobbyists.