Saturday, April 16, 2011
Sandoval Manager Fired After Intel Property Tax Dispute
By Rosalie Rayburn
Copyright © 2011 Albuquerque Journal
Journal Staff Writer
Sandoval County Manager Juan Vigil was fired Friday following a property tax dispute with computer giant Intel.
As a result of resolving that dispute, the household-name international company that opened its Rio Rancho plant more than 30 years ago will have to pay property taxes for the first time this year.
County Commission Chairman Darryl Madalena hand-delivered a one-page letter to Vigil on Friday that told him to vacate his office and return all county property by 4 p.m. Monday.
Vigil did not respond to a phone message asking for comment.
Earlier this week, Vigil provided documents, which he said were unofficial, that showed the county assessed Intel's Rio Rancho plant property at $38.2 million, with a taxable value of $12.7 million.
Jami Grindatto, Intel's director of corporate affairs for the Southwestern U.S. said this week the company was happy to go on the county tax rolls and the county assessor is determining how much tax the company will owe.
In an interview on Friday, Madalena said the reason for firing Vigil was that the county needed to "move in a different, more positive direction."
He declined at first to be more specific, but later admitted the dispute between the county and Intel over the amount of property tax the company owed played a role.
"It wasn't just the dispute. It was the entire relationship the county was having with the Intel corporation," Madalena said, adding, "I have heard that there were instances that Mr. Vigil was a little bit brash and had an arrogance about him in some of the meetings with the higher ups with Intel."
The tax relates to property covered by a $30 million, 30-year industrial revenue bond agreement Intel signed with the county in 1980 that expired last year. The agreement gave Intel a break on property taxes.
Correspondence between Vigil and Intel officials last year show the county believed everything on portions of the Intel property covered by bond agreements in 1980 and 1993 should be assessed for tax purposes. Intel's position was that some of the equipment and other material in those areas were purchased with money it obtained from the $16 billion, 30-year IRB the county agreed to in 2004, and those items should be exempt from taxes until 2034.
"The county's interpretation not only would affect Intel's tax liability under the current 2004 deal, but would render the site completely unattractive for future investment after 2023," Intel corporate senior counsel Greg Slater wrote in a letter to Vigil dated May 17.
Slater ended saying, "The issue has now been escalated to the highest levels of management within Intel and is of great concern to the company."
Vigil responded that extending the tax exemption would violate New Mexico law.
In September, Vigil wrote to Intel vice president and treasurer Ravi Jacob at the corporate office in Santa Clara, Calif., saying, "the taxpayers of Sandoval County have subsidized the operations of Intel for 30 years and will continue to subsidize a major portion of those operations until September 2023."
"It is extremely important to our taxpayers that they receive what is due them for the service the taxing entities provide our citizens," Vigil's letter said.
Grindatto said this week that Intel built Rio Rancho High School and has paid millions of dollars in lieu of taxes to the county since it opened the Rio Rancho plant in 1980.
Reached at home Friday evening, county Assessor Tom Garcia said a notice of valuation was sent to Intel on Friday but the actual amount of tax liability is still unclear. The county sends out tax bills in November.
Vigil was hired as county manager in January 2009 on a two-year contract at an annual salary of $120,000. He had been Bernalillo County manager for many years and administrator for the village of Los Ranchos.
In December, the commission approved a new two-year contract at the same salary. On April 7, the commission voted 3-2 to terminate Vigil. County Attorney Stephanie Lopez said the vote appeared to conflict with language in Vigil's contract that said he could only be terminated by a "supermajority" vote.
Lopez told Madalena that meant a 4-1 vote. Madalena, however, ruled that the 3-2 decision should stand, though he agreed to seek the attorney general's opinion whether the commission had acted properly.
On Friday, Madalena said he hadn't contacted the attorney general and probably wouldn't.