Senate votes to override Guv’s veto of 2009 SIC reform bill

Senators on Tuesday voted 33-4 to overturn Gov. Bill Richardson’s 2009 veto of a bill that would have given the Legislature more say over who sits on the State Investment Council. It was the state Senate’s second veto override vote in as many days.

Unlike a veto override vote taken Monday, which provoked a vigorous debate, today’s vote was accompanied by no debate, reflecting a generally united front among lawmakers.

Only after voting did a handful of lawmakers explain their votes.

“I don’t think this should be the end of it–there are a number of other bills out there,” said Sen. John Ryan, R-Albuquerque. “We’ve got a lot more to do on the State Investment Council.”

Sen. Majority Leader Michael Sanchez, D-Belen, who opposed the override, explained that he had no quibble with the vetoed bill. He said he merely questioned the timing of the Senate’s override vote as lawmakers work with Gov. Bill Richardson to pass SIC reform legislation this year.

Democratic Sens. Bernadette Sanchez, Mary Jane Garcia and Cynthia Nava joined Michael Sanchez as the only lawmakers opposing the override. Several senators were not in the chamber, however, including Sen. Phil Griego, who was the most ardent opponent to Monday’s override vote.

State lawmakers have been spoiling for a fight over the governor-controlled State Investment Council (SIC) because of the scrutiny it has attracted. The SIC is at the center of an ever-widening investment scandal with ties to New York state and California and also is the subject of a federal criminal investigation and a Securities and Exchange Commission probe.

Tuesday’s action came despite an effort this year by state lawmakers to move far beyond last year’s legislation to reform the SIC. Last year’s proposal largely gave the Legislature more appointments on the SIC.

This year’s legislation would change not only the makeup of the State Investment Council’s board, (SIC) but also restructure how the agency is governed.

Among the changes contemplated are:

• The Governor would be removed from the SIC.
• The SIC would select the State Investment Officer, not the Governor.
• The SIC would gain the authority to hire and fire management services. That is now the purview of the State Investment Officer.
• The Governor would appoint only three members of the SIC (and only 2 from the same political party).
• If a member of the SIC misses three meetings in a row, they would lose their seat.
• Seven appointed public members of the SIC must have 10 years experience in investment or finance.

Uncommon move

Before this week, a veto override was uncommon, especially during the years that Richardson, a Democrat, has worked with a Democratically-controlled Legislature.

According to the Legislative Council Service, Tuesday’s vote to override a gubernatorial veto was only the second time the Senate had ever voted to override Richardson on legislation. The first occurrence came on Monday.

The override doesn’t take affect unless the House also votes to override.

The Senate’s action also takes place against a backdrop in which lawmakers are still debating how far to go in reforming the SIC.

A division has emerged between lawmakers who want to focus on changing the makeup of the board and those who back more substantial reform.

All of the reform bills take some cue from a just-completed outside review of the State Investment Council that recommended significantly reducing the governor’s power over the agency.

That report found that Richardson’s influence over the State Investment Council “is more far-reaching than it is for governors in most of the 14 other states with similar funds,” according to Chicago-based consulting firm EnnisKnupp.

In addition, decisions on how to invest New Mexico’s $13 billion worth of endowment funds were made internally and largely without scrutiny from the board appointed to oversee the state’s portfolio, the report said.

Sen. Tim Keller, D-Albuquerque, who is pushing for significant reform, has reminded lawmakers that only three of the report’s 80 recommendations had to do with who sat on the Council.