Tobacco Bill Veto Puts NM in Danger

Hello again, readers of the Rest of the AGO Story. Today's offering is a Report from the Attorney General concerning the Governor's veto of an important tobacco bill from the last legislative session.

But before we get into that, one last thing about my previous posting. I find it interesting that of the two most vocal critics of the Attorney General, one didn't bother to send a representative and the other didn't ask a single question during the AG's 90 minute detailed explanation of what his office is doing to combat corruption and pay-to-play cases. Go figure.

Tobacco Bill Veto Puts NM in Danger

On Tuesday, April 5, 2011, Governor Martinez vetoed Senate Bill 397, a bill that would level the playing field for all cigarette manufacturers by requiring that they all pay their fair share of the health care costs their products cause in New Mexico. The veto was in direct contradiction to the legal advice provided to her by my office, which for years, has been in charge of maintaining the historic Master Settlement Agreement with major tobacco companies. Besides clearly putting the interests of the tobacco industry ahead of the health of New Mexico citizens, the veto enables a continuation of unequal treatment for cigarette makers who did not join the Master Settlement Agreement. The biggest benefactor of the Governor’s veto is a large cigarette manufacturing plant in New York.

It also puts at risk tens of millions of dollars that are currently flowing into the general fund and a separate escrow account. That is not the worst of it. New Mexico may be on the hook to pay back roughly $160 million that tobacco manufacturers have paid the state under terms of the MSA.  If these funds are lost, New Mexico may be forced to repay the $160 million by giving up our MSA payment of $40 million per year for the next four years.  Where will replacement funds come from? Unfortunately, increased taxes for all New Mexicans is the likely answer. I do not believe this is what the Governor intended as a result of her veto.

The real possibility of New Mexico having to repay tobacco settlement monies would be just one more step toward our state having to face a near catastrophic financial setback.

State Representative Gail Chasey, who co-chairs the Tobacco Settlement Revenue Oversight Committee tells us, “The legislature understands the importance of diligent enforcement to protect our permanent funds and future effective anti-smoking programs. Additionally, this legislation would have it made it very difficult for MSA participating members to prevail in claims against the state for failure to diligently enforce its escrow statutes; at the same time the bill would provide statutory support for the state to bring claim against non-participating members who fail to pay escrow."

One of Representative Chasey’s concerns, shared by my office, has already happened. MSA participating members have just filed notice with the Independent Auditor for the Tobacco Settlement funds alleging New Mexico no longer has a qualifying escrow statute. This notice appears to be triggered by the veto of Senate Bill 397. This could result in a claim against New Mexico that calls for refunding tobacco payments for 2007, 2008, 2009 and 2010. New Mexico could be found liable for our entire payments for those years (roughly $160 million), and would then have to forfeit our payments for the next 4 years.

The bill the Governor vetoed would have cured that problem for 2012 going forward.  Now, we may have to wait until 2014 before a statutory change can be implemented for an entire calendar year to fix the problem in a way that protects New Mexico from the loss of MSA funding. We believe New Mexico is and has always been compliant with the tenets set forth in the MSA, but we must continue to fight the legal challenges brought by the tobacco manufacturers that argue to the contrary.

There is no question that all of us in New Mexico are and will be paying for the health care costs of tobacco for the foreseeable future. This bill would have ensured that these costs be shared more equitably by tobacco manufacturers and smokers.

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What Really Stinks

Opinions are like certain parts of the human anatomy, almost everybody has one. Unfortunately, certain opinions have been proffered about Attorney General King’s handling of several important legal cases that are so far off the mark that they must be addressed publicly.

The comments and criticisms of Gary King are not only based on obvious misinformation, but they are personal attacks on the character of the man. And yes, these lies are hurtful to me. Not just because I work for the Attorney General, but because I know the person he is and the real dedication he has for serving the people of New Mexico.

I made a living for many years making fun of and criticizing politicians, most of it was just for laughs. My personal guideline though, was to try hard not to attack a person’s character. Unfortunately, sometimes I went too far and immediately regretted what I said and I apologized. Some in today’s media are a different sort. Innuendo, outright lies, and personal or corporate agendas serve as “news” and “commentary.” Individuals are publicly sliced and diced and ripped apart as if the “commentary or opinion” were some sort of perverted macabre blood sport. There seems to be an increasingly pervasive media attitude that growls, “Yeah, we ripped him good! Who else can we shred?”   

Most politicians are used to that kind of treatment though, it comes with the territory. Why they subject themselves to it I will never truly understand. I know why Attorney General King does it though. He subscribes to the theory that one person, working hard and doing the right things, can make a positive difference in the lives of the people he serves.

The bottom line, AG King will publicly address his critics’ concerns very soon. He’ll talk about what really has happened in the Vigil-Giron case, including the truth about alleged conflicts; he will discuss the AGO’s involvement in the so-called whistleblower Foy case and alleged conflicts; and to the extent allowed, anything else anyone interested in the truth wants to know. I am curious to see if those with the loudest mouths about their own twisted perceptions will be interested in the rest of the story.  Details to follow.

Former State Police Officer Going to Trial for DWI

We just received word from the Supreme Court of NM that the writ of superintending control in the Abraham Baca case was denied and the stay was lifted, meaning the case gets sent back to district court. The AG's special DWI prosecutor, Donna Bevacqua-Young will once again handle the case.  The trial will likely be set sometime over the next two months or so in district court depending on the judge's schedule.

Whistling the Conflict of Interest Tune

The phrase "Twinkie defense" comes from Twinkies, a food product high in sugar.

I just had a flashback to 1978 and the infamous "Twinkie Defense," coined by reporters during their coverage of the trial of defendant Dan White for the murders of San Francisco city supervisor Harvey Milk and mayor George Moscone.(Thanks to Wikipedia)


How does this relate to the Victor Marshall/Frank Foy allegations that AG King and his office have "irreconcilable conflicts of interest" and should be barred from any further participation in New Mexico's pay-to-play litigation? Well, it seems trendy these days to accuse the AG of having conflicts of interest whenever one of the Office's prosecutions seems to be getting too close to going to trial. You may recall that following the "Twinkie Defense" it seemed that every defense attorney in America began using similar claims in hopes of improving their cases' chances. In the years that followed there was a proliferation of defenses that blamed drugs, alcohol, hypoglycemia, space aliens, "voices in my head," or late night pizza, for causing people to commit crimes. It's the same principle here, if you don't like what the Attorney General is doing, just accuse him of having a conflict of interest.


Before we go any further, let me state that there are no conflicts of interest involved with the AGO's litigation of the cases in question and no one is getting a pass on being held responsible. The rest of the story that Mr. Marshall has not told anyone is that he's known about all of the alleged relationships for more than two years and that he only now is claiming them to be conflicts because the AG took some parts of his play-to-play litigation away from him for non-performance. 


"Victor Marshall has been totally ineffective after two years," says AG King. "I have to put the interests of the state ahead of the interests of Mr. Marshall and his attorney's fees."


But before I leave this topic, one important thing should be pointed out. No other NM Attorney General has ever been this involved in prosecuting corruption and investment fraud. It is not surprising then that some are quick to whistle the conflict of interest tune, hoping no one remembers the old "Twinkie Defense."