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Mayoral candidates clash on taxes, projects

Copyright © 2013 Albuquerque Journal

Pete Dinelli envisions a major expansion of the airport and offering city land for partnerships with private companies.

Mayor Richard Berry says he has already pushed to change the state tax code and is working with the University of New Mexico to commercialize research that happens in Albuquerque.

Paul Heh wants to market the region’s “Wild West” history and hold athletic competitions and car shows that lure tourists to the city.


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All three mayoral candidates on the Oct. 8 ballot say they have plans to accelerate Albuquerque’s recovery from the Great Recession. They share much in common. Each wants to cut red tape, accelerate permitting and support the school system.

But they differ on the details and approach.

One particular hot issue is recent changes in the state tax code, including a reduction in the corporate income tax rate and a tax break for manufacturers that sell much of their goods outside the state. Berry is supportive, and Dinelli is critical. Heh says it didn’t go far enough.

Berry said he commissioned a study of the strengths and weaknesses of the local tax code, then successfully pushed for those changes at the state level, based on the research. He said he worked hard “in my first term making sure Albuquerque is a much more competitive place. … We got that done, and now Albuquerque’s in much better shape.”

Dinelli said state tax changes will cost the city tens of millions of dollars in “hold harmless” payments from the state, which was part of the corporate tax deal.

“Hold harmless” payments are state reimbursements to local governments for not taxing food and medicine, and eliminating the payments is intended to offset the revenue loss from the state tax cuts.

Some communities in New Mexico are already preparing to raise taxes to offset the reductions, even though the cut in state reimbursements hasn’t started yet and will be phased in over many years.

“The corporate tax structure was done on the backs of the municipalities and the county governments,” Dinelli said. It’s simply part of a “quick fixes” approach to the economy, he said.


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Berry argues that economic growth will offset the cut in state payments.

Heh said he favors tax cuts, in general, and hopes the state will cut taxes further.

“I’d like to see no income tax rate,” he said.

If no candidate gets 50 percent of the vote on Oct. 8, then the top two will compete in a runoff election tentatively set for Nov. 19.

Here’s a closer look at how the candidates say they’d approach economic development:

Richard Berry

The mayor is working with UNM on a project modeled on Innovation Square in Florida – a joint venture among the University of Florida, government and the private sector that combines research, technology and private enterprise in one big development.

Berry has proposed $2 million in city bond funding for the project, which could end up at the First Baptist Church site, just east of Downtown. The location also would help Downtown revitalization, he said.

UNM regents recently agreed to move forward with a federal-grant application that could help fund the project, too.

“If you look at the charts, New Mexico, in general, gets much more funding for research than our neighboring states, yet we commercialize much less of that research,” Berry said. “To create opportunities for college graduates in Albuquerque, we absolutely have to foster that mind-to-market concept.”

The mayor said he’s already streamlined the building-permit process with the “FasTrax” system, in which companies can pay extra to expedite review of their plans. And he said he established a business center to help people start and grow businesses.

Berry also has won City Council approval for a less costly energy code and a simplified system of impact fees on development.

“We’re going to continue to break down the red tape and barriers to investing in the city of Albuquerque,” he said.

The city also has a new $5.5 million fund to market Albuquerque nationally, Berry said, and has launched an effort to encourage skills-based hiring and training.

“We’re working on all fronts to make sure that economic development continues to be a priority if I’m fortunate to get a second term,” he said. ” … There isn’t a magic wand to it.”

Berry also started the “Running Start for Careers” program that helps high school students learn a trade. “We have students that are graduating from high school ready to enter the work force,” Berry said.

Pete Dinelli

Dinelli, a former deputy city attorney, argues that Berry isn’t thinking big enough to boost Albuquerque’s economy.

“I believe in order to turn our economy around,” he said, “we have to think bold, we have to think innovative and we have to be far more aggressive in selling our city.”

He often touts what he calls a $1.5 billion plan called “Energize ABQ.” It would not involve new taxes, he says, though he hasn’t detailed where all the money would come from.

Dinelli maintains it would be paid for by cutting waste and inefficiency in government, restructuring debt, issuing industrial revenue bonds, issuing lease-revenue bonds and other sources.

He said the city has the financial capacity to fund a $300 million airport expansion, perhaps with a new terminal that focuses on international flights. Construction wouldn’t begin until a major company like Air Canada or FedEx signs on, he said.

The airport’s annual debt payments are scheduled to drop off in coming years, allowing for the funding of a major expansion without raising how much the airport pays each year, Dinelli said.

“Albuquerque would fit like a hand in the glove going after the transportation industry,” he said. The city’s location and proximity to the railroad system make it possible to turn the airport into “truly an international hub.”

Dinelli also said the city can think big with its golf courses and other city-owned land. For example, the city could shut down the golf course at Los Altos in the Northeast Heights and offer the land as incentive for a private company’s project.

One idea, Dinelli said, is to “maybe reduce the number of golf courses and use the land for public-private partnerships. … Maybe the question we have to ask ourselves is, ‘Do we have too many golf courses?’ ”

The city could consider the possibility of an event center, health-care facility or research center on city-owned land, he said.

“It gets back to examining what assets we have,” Dinelli said.

Dinelli said he would like to make the city more pedestrian-friendly and focus the bond program on stimulus-like projects that can be done right away. He said he would lobby on behalf of Albuquerque Public Schools.

“I will never say the mayor should take over APS,” he said, “but I think the mayor needs to work closely with our school system.”

He wants to create a chief economic officer job that consolidates and streamlines economic-development functions at City Hall.

Paul Heh

Heh, a retired police sergeant, envisions holding major events in Albuquerque to generate tourism, drawing on the region’s “Wild West” reputation.

One possibility, he said, is a 250-mile bicycle race around the Albuquerque area, with a major cash prize. Advertisements could read: “Ride or die in the desert. You think you’re tough enough? Come to Albuquerque and prove it.”

Heh said he’d also like to use the city’s Route 66 history along Central Avenue to draw people interested in cars and motorcycles. He envisions prizes for the best vehicles in certain categories, promoted as part of a car show.

“This is a car town,” he said. “… Just line Route 66 with all these vehicles. This can be done. It’s kind of like, ‘Build it and they will come.’ ”

Heh said the Police Department must be fixed to address crime problems that hurt business recruitment. He proposes replacing and streamlining the chain of command.

“No major business is going to move here” until the problems are addressed, he said.

Heh also wants to start trade schools for students who drop out of traditional high schools and a rehabilitation center to which people convicted of misdemeanor drug crimes can be sentenced.

“We have a horrendous dropout rate in schools,” Heh said. ” … College isn’t for everybody.”

Says he has pushed to change the state tax code and is working with the University of New Mexico to commercialize research that occurs in Albuquerque.

Wants to hold major events in Albuquerque to generate tourism, drawing on the region’s “Wild West” reputation. One idea is a 250-mile bicycle race.

Envisions a major airport expansion and proposes offering city property for partnerships with private businesses.