Richardson Gives the Finger to New Mexicans

While Election Day attention was focused on other matters, Governor Bill Richardson’s Environment Improvement Board (EIB), taking advantage of the cover provided by media attention being diverted elsewhere, adopted a Cap and Trade regulation that is certain to destroy jobs in New Mexico. It will certainly result in additional job killing costs being heaped upon New Mexico just to reverse the ruling.

During Governor-elect Martinez’s news conference announcing former Congresswoman Heather Wilson’s appointment as Chair of the Transition Office, Martinez indicated that her staff was researching how to go about reversing the regulation. So because of Richardson, staff time and energy needed in transition will be diverted.

Because BOTH Martinez and Denish had opposed the regulation to begin with, it doesn’t make much sense to adopt the measure; particularly during the lame duck period. This move by Richardson's EIB can only be interpreted as a major “up yours” to New Mexicans.

Litigation Mess On our Hands
Because the EIB process, unlike other state regulatory processes, is so lengthy (EIB took almost an entire year to review Cap and Trade and a Cap only proposal), it may take nearly as long to pass a repealing regulation. Governor Martinez’s future appointees to the EIB would have to go through Senate Confirmation, consequently the earliest a newly composed EIB can even begin the process would be in the Spring of 2011. Assuming that the EIB takes almost as long to repeal, what happens in the interim? Well, one method in dealing with this mess created by Richardson’s people is to not enforce the Cap and Trade. Here is the rub: the environmentalists will likely file suit to compel enforcement.

Of course litigation to strike down the regulation is a possibility. It may also be quicker than going through a repeal process. Most likely the regulation would be struck down as unconstitutional under the New Mexico Constitution. The regulation is so overly broad that the EIB has effectively created law rather than adopting rules to carry out existing law. The EIB action thus violates the separation of powers. The New Mexico Constitution says, “[t]he powers of the government of this state are divided into three distinct departments, the legislative, executive, and judicial, and no person or collection of persons charged with the exercise of powers properly belonging to one of these departments, shall exercise any powers properly belonging to either of the others․”....” N.M. Const. art. III, § 1. The New Mexico Supreme Court reiterated that principle when they ruled in 1997 the Johnson Administration exceeded its authority by using the regulatory process to implement a major overhaul of the state public assistance programs without legislative participation. See New Mexico ex rel. Taylor v. Johnson 961 P.2d 768 (N.M. Sup. Ct. 1998). The courts allowed the regulation hearings to proceed - largely because until an actual regulation is adopted there is no actual violation. There is ample precedent for injured parties to have a reasonable chance to win a suit, thus they are likely to sue on state constitutional grounds.

A Double Whammy in Litigation Costs
Here is the double hit New Mexicans will take on any litigation, the lead company fighting the Cap and Scam Trade regulation is the Public Service Company of New Mexico (PNM). It’s no surprise since PNM will be hit hard by this regulation and have to spend a great deal to purchase the carbon credits. The company owes a duty to their stock holders to litigate and attempt to strike the regulation down. So, the state will have to pay attorneys defending the suit. Meaning the taxpayer, New Mexicans, will foot the bill to defend the suit. On the other side, PNM will also pay attorneys to litigate, passing the costs to whom? Rate payers, in other words New Mexicans. Even if the courts hold that the ruling in Taylor v. Johnson does not apply, the costs are still born in the litigation. So, we the people of New Mexico are going to pay one way or another in litigation attempts to strike the regulation down, or defending against litigation from environmental groups suing to compel enforcement of the regulation, or worse we live with the regulation while it goes through the repeal process and suffer more economic harm to this state.

Thanks, Bill! Thanks for really sticking it to us at the end there. Let’s hope that if you decide to run for office again that the people remember what you did to them.