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New Mexico Pension Reform Bill Is Vetoed

New Mexico’s governor, Susana Martinez, has vetoed legislation that would have eliminated her position as chairman of the board of the State Investment Council, which manages the state’s $15 billion in pension funds, including $1.3 billion in private equity.

The governor told the New Mexico Senate that the bill did not go far enough to eliminate politics from the council’s investment decisions. Scott Darnell, a spokesman for the governor, said, “The surest way to eliminate politics (from the investment council) is to take politicians off the council.” While the vetoed bill would have removed the governor as the council’s chairman, it would have let two elected officials remain on the board. Those two officials are New Mexico’s treasurer and the state’s land commissioner.

The bill also would have allowed Martinez remain as chairman through 2013. The provision letting her remain temporarily as board chairman was designed to give her time to assess whether rules had been broken by council’s previous chairman, Gov. Bill Richardson.

Earlier, Buyouts reported that efforts were underway by New Mexico legislators to try to remove politicians, including the governor, from the council’s board, given the embarrassing controversy surrounding a pay-to-play scandal that drew attention from federal authorities. In addition, Richardson was alleged to have channeled funds into projects that he favored while he chaired the council. No charges have been announced.

In February, Martinez said that she hoped to see a bill that would disqualify all active politicians, including governors, from serving on the board. In her veto statement, Martinez also criticized the bill for failing to require new council board members to have at least 10 years of professional investing experience, saying, “The legislation failed to include this common sense provision which, in the aftermath of recent financial scandals, I believe is a necessary step toward restoring public trust.”