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SANTA FE — A proposal to revamp the State Investment Council and reduce the governor’s influence over the board that oversees $12 billion in endowment funds was unanimously approved by the House on Sunday.
The governor serves as the Investment Council’s chairman and can control the nine-member board through his appointment power. The bill would expand the council’s membership to 11 but reduce the governor’s public appointments from three to two members.
The bill also allows legislative leaders to name four appointees, no more than two of whom can be members of the same political party.
The council would appoint the state investment officer rather than the governor, and appointed council members would be prohibited from having had any contracts with state investment entities two years prior to their appointment and two years after their term ended.
House Speaker Ben Lujan, D-Santa Fe, said the measure approved by the House is “much stronger” than a proposal that was vetoed by Gov. Bill Richardson after last year’s legislative session.
Aside from the contract prohibitions, Lujan said the bill allows for the removal of appointed council members if they miss three consecutive meetings and the council can remove the state investment officer for cause without a hearing before the state Supreme Court.
The Senate approved its version of the Investment Council overhaul on Friday. However, both chambers of the Legislature must pass the same version of the bill before it goes to the governor to be signed into law.
The effort to revamp the council is aimed at lessening the potential for improper political influences over decisions about investing taxpayer money.
A federal grand jury is investigating state investments and has requested documents from the Investment Council and an educational pension fund about millions of dollars in fees paid to third-party marketing agents, including a politically connected New Mexico broker.