Violation of Public Trust

It's unclear if Phil Griego's resignation from the Senate will be the end of the story

Sometimes even good ol’ boys have a bad day. Last Saturday, Phil Griego, a veteran Democratic Party political power broker and chairman of the New Mexico Senate’s Corporations and Transportation Committee, had what was probably the worst day of his political career.

Confronted with ethics violations connected to a $50,000 commission he earned brokering a real estate deal for Santa Fe hoteliers Ira and Sharif Seret, and facing expulsion from the Roundhouse, Griego resigned the Senate seat he first won in 1996.

Although Griego admits to the facts that included encouraging colleagues to support a measure declaring a state building "surplus land" and making money to then broker its sale, so far prosecutors won't say if New Mexico can expect an investigation into whether Griego also broke the state's Governmental Conduct Act.

Violations of the law can be prosecuted as fourth-degree felonies because it is "unlawful for a public officer or employee to take an official act for the primary purpose of directly enhancing the public officer's or employee's financial interest or financial position."

Griego and his attorney, Diego Zamora, refused to comment for this story, as did a representative for Attorney General Hector Balderas when asked whether Griego is the subject of a criminal investigation. First Judicial District Attorney Angela "Spence" Pacheco, who also has standing to prosecute crimes in Santa Fe under the act, told SFR no one has referred the Griego matter to her office.


Sen. Phil Griego signed a statement admitting his misconduct in violating Senate rules, the state constitution and his oath of office. Here are the highlights of what happened:  

He initiated the legislative process by soliciting the help of Rep. Jim Trujillo, D-Santa Fe, to sponsor a resolution to declare a state building as “surplus property.” Griego never told colleagues that he was helping the hoteliers purchase the property.

Although he apparently left the room during a Senate vote on the final bill, Griego never told the Capitol Building Planning Committee, which was reviewing the sale, that he was monitoring the deal under contract and helping the Serets obtain a signed purchasing agreement, coordinate closing documents and assist with other acquisition issues.

Griego earned $50,000 for his role as a broker helping Galisteo Street Inc.’s Ira and Sharif Seret acquire a state building adjacent to their Inn of Five Graces in the Barrio de Analco after the legislature approved its sale in 2014.

Griego eventually recognized that he’d violated the Senate’s Oath of Ethical Conduct, in which he swore to"abide by the spirit as well as the letter of the Senate rules pertaining to ethical conduct" and "scrupulously avoid any act of impropriety or any act that gives the appearance of impropriety.” He resigned on March 14.

While rumors of Griego's fate began swirling around the Roundhouse at the end of last week, few people actually knew the magnitude of what was happening behind closed doors. It's clear now that someone filed an ethics complaint after SFR published a series of investigative reports on Griego's business dealings with the Serets' Galisteo Street Inc. and the Carlisle Solutions Group last summer.

While the ethics complaint itself remains secret, Sens. Mary Kay Papen, D-Las Cruces, Michael Sanchez, D-Belen and Stuart Ingle, R-Portales, asked the Legislative Council Service, a nonpartisan state agency that drafts legislation and helps staff committees, to follow legislative protocols and launch a formal review last fall.

On Dec. 4, Raúl E Burciaga, the director of Legislative Council Service, selected two outside attorneys to act as special counsel to the official probe. Thomas Hnasko, a lawyer with the Hinkle Shanor firm in Santa Fe, was offered a $260-an-hour contract to work alongside Micheal Browde, another attorney already under contract with the agency for $175 an hour. Together, the lawyers began collecting documents, including a Buyer's Agency Agreement signed by Ira Seret and Excaliber Asset Management Company a month after lawmakers adopted a resolution authorizing the sale of a building owned by the state's Energy, Minerals and Natural Resources Department. That agreement was worth $50,000 to Griego if he successfully secured the sale for the Serets, who wanted to own the building they leased. They wanted to use the space to build a gym and conference room and escape the rigorous oversight by the New Mexico Historic Preservation Office.

On Dec. 29, Hnasko’s January invoice shows the special counsel had started legal analysis and that discussions about how to proceed with Griego’s potential violations of the state’s constitution, Senate rules and the Oath of Ethical Conduct were under way. So far, the legal bill for the special counsel adds up to more than $5,000, but the contract says it could mount to $30,000.

Most of the probe's communications are not subject to public disclosure, and it's difficult to ascertain when Griego was first informed about the legal conclusions from the special counsel. After the case was built against him, Griego agreed to a stipulated set of facts and signed a document stating he would consent to punishment, including reprimand or censure, and could be stripped, according to sources, from his chairmanship of interim committees.

Yet the session began in mid-January with no action on the situation, and Griego remained at the helm of the Senate committee he's chaired since 2009. Then, on Thursday, March 12, behind closed doors again, sources tell SFR, Democrat caucus members spent several hours debating what level of discipline to impose on Griego. Some lawmakers wanted him to be reprimanded or censured. Others, worried the public may think that they were being "too soft" on Griego and "letting him off too easily," thought Griego should be expelled. On the same evening, in their party caucus, Republican Party members who were privy to the results of the ethics complaint investigation also signaled they were considering introducing a motion to expel Griego.

With the writing on the wall, Griego decided to vacate his District 39 seat before a public meeting of the Interim Legislative Ethics Committee was scheduled to discuss the matter or before a lengthy floor debate could be called. After he was absent from the Roundhouse all day Friday, Griego had his attorney deliver a resignation letter to Secretary of State Dianna Duran and Senate Chief Clerk Lenore Naranjo, who read it into the record.

While state law governing ethics questions about lawmakers requires secrecy until probable cause is determined, Senate leaders involved in the process also decided to remain mum even after Griego's resignation and encouraged their members not to speak publicly about what happened behind closed doors.

But Griego, now gone from the Senate, decided to speak out himself. In a rambling three-page rant sent to the Santa Fe New Mexican, Griego claims he "unintentionally and unknowingly…violated an obscure provision of the New Mexico Constitution governing the timing of actions by citizen-legislators in their private business lives."

For months, Griego contended he hadn't received any benefit from the resolution because his deal with the Serets was made after the vote. A citizen-legislator needs to earn money, he argued.

"If they don't want us to do business, then pass a constitutional amendment to allow the legislators to be paid," Griego told SFR last summer.

But the constitution hasn't been changed, and Griego never offered to find the Serets another agent to help them close their deal with the state after they agreed to pay him a fee for helping to finalize the complicated sale.

And now new video has surfaced that shows Griego walking out of the Senate chamber immediately before the vote and returning just after, abstaining without explaining that he had a "personal or pecuniary" interest in the legislation. It's still unclear why the official legislative record on the matter shows that he voted yes.

The unfolding scenario leaves ethics reform advocates in the lurch.

Last September, months before she was appointed to the House, Stephanie Maez, in her role as the chief executive officer for the Center for Civic Policy, told SFR, "The citizens of New Mexico have a right to know whether members of their Legislature are for sale.

"When elected officials and policy makers betray the public trust," Maez said, "it sends a corrosive message to everyday New Mexicans that tells them, 'Don't bother with democracy; your interests and your needs don't count.'"

Common Cause Executive Director Viki Harrison is a longtime supporter of setting up an independent ethics commission in New Mexico—one of eight states without such a wpanel.

"Another way to help restore faith in government is to have any proceedings around ethical issues done in a public manner so the citizens of New Mexico know what is happening and why," says Harrison.

Harrison says she's pleased that the Legislative Council Service released some of the documents following Griego's resignation.

"The vast majority of elected officials in New Mexico are honest, hard-working people who only want the best for our state, and by releasing all public documents related to this case, the Legislature will strengthen their credibility with the public."

After last year's real estate transaction, Papen, Sen. William F Burt, R-Alamogordo, and Rep. Carl Trujillo, D-Santa Fe, each introduced bills that would give lawmakers more input on the disposal of state buildings and land in the future and authority to review long-term leases like the one that gave the Serets the first option to purchase the building.

"We shouldn't just be rubber stamps," says Papen.

State law allows the governor to name a replacement from a list of county recommendations when a legislator steps down or dies. While intially, Gov. Susana Martinez told six county commissions to make immediate recommendations, it now appears that process won't conclude before the session ends on March 21.

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