Letter America: Dear Southwest Airlines

Santa Fe Chamber of Commerce president (and blogger) Simon Brackley passes along this chart, compiled from Chamber members' responses to the question, "If a declining economy forces you to have to cut business expenses in the year ahead, will you cut?" (Presumably, there should be an ellipsis after "will you cut." Either that, or it should say, "what will you cut?" But we won't be sticklers. You get the point.) The question was asked only of Chamber members in the hospitality business—which is still a huge part of the local economy. Click the chart for a larger image. What's the takeaway? There's a small irony in the popularity of "travel" as a cuttable expense, considering that these businesses rely on other people continuing to travel. But considering that "other" was far-and-away their first choice, the lesson here may be that businessowners here have no idea where to begin cutting costs—especially since the recession already forced them to hire fewer staff this summer.

Why is this man smiling? Perhaps because, as the CEO of defunct Thornburg Mortgage, Inc., Larry Goldstone still draws a pretty good salary. The company paid him $188,274 in wages in July, according to bankruptcy documents filed Aug. 20 (Here's the PDF). This screengrab shows compensation for that period for other Thornburg Mortgage principals, including Chief Financial Officer Clarence Simmons III and six directors, whose backgrounds SFR described in a previous story on Thornburg: It's worth wondering how the 130 people Thornburg laid off last April feel about that level of compensation. Indeed, that's why we have a comments section.

The image below links to a Microsoft Excel file listing all recipients of state job training funds in Santa Fe over the past few years. I wrote about some problems with the Job Training Incentive Program in this week's SFR.

Such is the word from the Santa Fe Association of Realtors. Prices, they say, are holding steady. Condos are doing worse. "Now is the time to buy," according to Association President Mary Schroeder. That is, if you can find financing for anything more expensive than a FEMA trailer (pictured, left). Press release after the cut. Also, an aside: Negative 10 percent seems to be the magic number. Seems like everything's down by about that much. 2nd QUARTER 2009 SANTA FE CITY/COUNTY MEDIAN HOME VALUES HOLD STEADY WITH 2008 PRICES BUT FEWER SALES (Santa Fe, NM – July 8, 2009) The overall median price of homes sold in the City and County of Santa Fe combined during the 2nd Quarter of 2009 at $402,057 held steady compared to the same Quarter in 2008 at $412,500. While prices are holding steady with modest reductions noted, City/County home sales declined 11% from the 2nd Quarter of 2008 at 240 to the same Quarter in 2009 at 214. In the City of Santa Fe, price reductions occurred in all market areas resulting in a median price of $307,500 in the 2nd Quarter of 2009 compared to $344,000 in the 2nd Quarter of 2008. Condos and townhome sales were off 38% or 92 to 57 during the same two comparison Quarters in 2009 and 2008. “It's important to see sales generally on track with sales last year since this was a time period before many of the serious economic problems surfaced,” stated Mary Schroeder, 2009 President of the Santa Fe Association of REALTORS®. “Santa Fe home sales and values continue to stabilize with sales off only a modest percentage and values nearly level. However, condo and townhome sales are still struggling to stabilize as they now compete with lowered prices in the single family home market offering some real buying opportunities in this market area.” “Now is the time to buy a home in Santa Fe. There are real bargains in every area of the City and County with a great selection of homes to choose from,” said Ms. Schroeder. She added, “The First Time Home Buyer Tax Credit of $8,000 that can now be monetized in New Mexico could provide help with a homebuyer's down payment. And with the availability of low interest loans, it is truly an exciting time for home buyers.”

Here's more on the latest Santa Fe housing numbers from Alan Ball, general manager of Southwestern Title & Escrow in Santa Fe. If you're trying to sell. "I personally would like to write more upbeat news and share more positive information with each of you," Ball writes in his latest monthly newsletter, released July 10. "But for the umpteenth month in a row, the statistics do not show any measurable improvement in Santa Fe area home sales." There are more and more homes on the market, but fewer getting sold. Especially slow-moving are million-dollar-and-up homes, no matter how ugly. See? At this rate, Ball writes, it now takes an average of two years for the market to absorb Santa Fe's housing inventory. That's up from an average of eight months at the end of 2006. So what's the takeaway? Ball explains: If sales do not show improvement in the next 120 days, we are likely to see numerous homes go off the market and become anything from rentals managed by owners to just bank‐owned vacant homes for rodents and weeds. If you do not HAVE TO sell this year, I strongly recommend taking your home off the market for a couple years. SFR started noticing all those weeds a couple of months ago. (Sadly, the above photo is not from a Santa Fe real estate listing. It's from this awesome blog.)

I just got a letter from former New Mexico Gov. Toney Anaya about my stimulus application for a newspaper bailout. Dear fellow New Mexican, Hello! This letter serves as a follow-up to your inquiry through the New Mexico Office of Recovery and Reinvestment (NMORR). Your inquiry was referred to the appropriate state agency, who should have contacted you to provide assistance and to answer any questions. Not quite yet, but that's OK. I've been busy. We are reaching a milestone in this unprecedented effort, as the state-allocated competitive grants from ARRA funds are coming to a close. The NMORR has received over $8 billion in proposal and ideas for projects...it is clear that New Mexico has great need, however, not all projects and programs will receive funding through the America Recovery and Reinvestment Act (ARRA). What are you trying to say? Currently, opportunities are still available directly from federal agencies through the competitive grant process. You can learn more about those opportunities and how to apply at www.grants.gov. We encourage you to work with your local Council of Governments (COG, the regional planning organizations) and within existing state government processes for projects such as water, environment, energy, transportation and capital outlay funding consideration. These groups are very familiar with existing planning processes, but also familiar with existing and ongoing funding opportunities. Does this mean I'm not getting any stimulus money? For your area, please contact the Council of Government nearest to you: [etc., etc.] ... Again, I thank you for interest in stabilizing our economy and making New Mexico a better place for all of us. That might be the most polite brushoff ever.

Someone at the Santa Fe Chamber of Commerce has written and posted a response to the recent SFR item on a dispute between the Chamber and the Santa Fe Alliance over the "Buy Into It!" campaign. The idea that the Santa Fe Chamber has co-opted the term “shop local” is beyond absurd. Part of the mission of the Chamber is to “grow the local economy.” ... Whether a business is a local “mom & pop shop” or part of a larger, national company has no bearing on the overall economic impact that the business has on our community. A business named The Santa Fe Shop can be owned out of state. The Santa Fe Reporter is headquartered in Portland, Oregon. Snap! To deride Santa Fe businesses that may have out of state ownership or be a part of a larger, national company, perpetuates Santa Fe's perceived anti-business sentiment. Etc. Read the whole thing at the Chamber's blog (for real).

An addendum to this week's story on the sure-to-be-slow summer tourism season: Last week, SFR asked city of Santa Fe finance director David Millican what the projected 10 percent drop in hotel occupancy would translate to in terms of gross receipts tax revenue for the city. Millican got back to us*, but too late to make the print edition. Here is his reply, in part: We are predicting 9% drops in GRT generally and have not done a detailed study on tourism because tourist and non tourist information is lumped together in two major categories, Retail and Accomodations and Food... In other words, it's hard to say what a slow tourism season means for the city budget. More from Millican after the cut: The summer economy last year escaped most collateral damage from the economic collapse in the fall. We think the concerns that built up during last year will be reflected in summer travel this year. We hope, as does the industry, that emerging signs of stability and optimism will mitigate some of that. With the Railyard, The Convention Center and the Railrunner added to the mix there are bound to be good things happening. Millican adds that local lodging tax numbers aren't as bad as a daily business-page story made them out to be yesterday: I saw a blurb in the New Mexican today that cited a 42% decrease in Lodging Tax. That is not an accurate reflection of what is going on. The Lodging Tax report showing the big drop is based on cash receipts. Some cash gets in after the deadline but before penalties are assessed so the best number to look at is the year to date number which is down about 11%. * Note: Newspapers always appreciate that.

The New Mexico Business Weekly republished a Wal-Mart press release this afternoon: The Walmart Foundation is giving $75,000 in academic scholarships to 25 college-bound students in New Mexico. Each student will receive a $3,000 Sam Walton Community Scholarship for the 2009-10 academic year. The funds are a slice of $8 million that the Walmart Foundation is giving nationally to students for college. Those scholarships should make everyone feel better about the $11.6 million in state corporate income taxes the company tried to dodge by setting up bogus shell companies and paying itself rent. Thanks, Wal-Mart, for kicking in 0.00056 percent of your annual profit toward the cause of higher education for New Mexico's young men and women. At that rate, we'll restore some balance to this economy by the time their great-great-grandchildren get out of debtors' prison.

May 16 is really going to suck for the young artistic class of Santa Fe. Not only does the College of Santa Fe celebrate its final graduation as a private school but The Candyman, the only indie music store in town, shuts its doors. Not only have I spent hundreds of dollars on records at The Candyman over the last few years but I've also earned a few bucks working there on the side, doing inventories, ringing up customers, etc. It's been the kind of place where, on a bad day, I can just hang out. Things haven't been going so well for Santa Fe's only indie record store for some time. Of course all the music pirates have made selling CDs difficult but the store's vinyl and classical sections helped bring people in the doors. The economy tanking hasn't helped either but it was the death earlier this year of owner Matthew Schartzman that made going forward nearly impossible. But, while The Candyman will be selling off its inventory of CDs, DVDs and high end televisions local musicians can be assured that the other half of the business, Strings and Things, is staying strong. Longtime employee Rand Cook is set to take over and, if all goes well, expand the musical instruments part of the shop. The sale begins on Wednesday and the store closes its doors on May 16.