DALLAS - Amid a flurry of scandals and investigations involving bond transactions, New Mexico Lieut. Gov. Diane Denish is pushing new ethics legislation as she seeks to escape the tarnished image of Democratic Gov. Bill Richardson.
Richardson, whose GRIP - or Governor Richardson's Investment Partnership bond program - has drawn a federal inquiry into pay-to-play allegations, is not running for re-election next year.
Denish, a fellow Democrat and the only declared candidate for governor in 2010, is seeking to distance herself from the Richardson probe and other Democrats facing similar investigations.
Last month, Denish pointed out that she had led reform efforts in public housing after several officials with the New Mexico Housing Authority's Region III were indicted in the misuse of bond money for the benefit of regional director Vincent "Smiley" Gallego and others.
Also indicted were Albuquerque bond attorney Robert Strumor and former Region III employees David Hernandez and Dennis Kennedy.
In a press release after the indictments, Denish claimed that she "led the effort to reform the entire Regional Housing Authority and to make certain more oversight of public funds was in place."
But Republicans are running ads that feature Denish's image on a slot machine in the "Richardson-Denish game of pay-to-play."
The 30-second spot claims that Denish once opposed gambling on economic grounds but then cast two tie-breaking votes to expand gaming after casino owners donated to her campaign.
"Another pay-to-play jackpot," the voiceover says. "No matter how Diane Denish spins it, isn't it still the same game?"
The pay-to-play investigation of the GRIP bond program has already cost Richardson a cabinet post in the Obama administration. Now, Republican Party chairman Harvey Yates Jr. is predicting that the "caudillo" - or strongman - will not complete his second term as governor.
"Will the Richardson-Denish administration go down in New Mexico history as the most corrupt administration since World War II, if not since statehood? Probably. Hardly a day passes without a news story having to do with corruption," Yates wrote in an op-ed piece for the Albuquerque Journal.
"Will Richardson survive his term? I think not. I predict that the long-overdue, serious investigation of corruption in this state will cause his departure. I predict that Diane Denish will be the incumbent governor against whom a Republican runs in 2010."
For her part, Denish outlined an ethics reform package that she plans to introduce in the 30-day legislative session next year.
The proposals include a new, independent State Ethics Commission and a so-called Sunshine Portal where the public could monitor state contracting on the Internet, including campaign contributions.
"New Mexicans have a right to know who is contributing money to their elected officials," Denish said in her announcement. "That's why I have voluntarily reported all contributions and expenditures on a quarterly basis by posting them on my Web site. In the next session I'll fight to require all candidates in New Mexico to disclose who is contributing to their campaigns every three months."
Federal prosecutors have been looking into a contract that the New Mexico Finance Authority awarded to CDR Financial Inc., which also gave $100,000 to political action committees formed by Richardson as he was planning his 2008 presidential run.
NMFA chairman Stephen Flance has asked the state attorney general's office to seek recovery of money lost from the companies that recommended interest-rate swaps in the GRIP bond issue. CDR served as swap adviser in the deal and was linked to senior managers in the state's largest bond issue.
Disruptions in the swaps market led the agency to refinance $450 million of $1.7 billion in bonds used to finance roads, rail and other transportation projects.
