NM should reform SIC, which manages $22 billion

For some reason, New Mexico has struggled with the concept that certain jobs require certain qualifications.

For years, there was no bar set — other than age, residency and criminal record requirements, plus winning a low-turnout election — to serve on the Public Regulation Commission. That’s the body that decides complex utility rate cases — cases that take years to file, present, hear and address; cases that require analysis of investment strategies, energy portfolios, returns on investment and legal propriety, among other issues.

Then in 2013, after numerous scandals involving PRC commissioners arrested for everything from possession of drug paraphernalia to assault with a rock to abuse of the state credit card, the Legislature passed, voters approved and the governor signed minimum qualifications for the PRC.

Now, the elected individuals who make $90K-plus a year to make decisions that affect every New Mexican’s wallet have to have at least have 10 years of professional experience in an area the PRC regulates, or a combined 10 years of relevant experience and higher education resulting in a bachelor’s degree. Also required: 32 hours a year of relevant continuing education and two hours a year of ethics training.

Don’t state taxpayers deserve that same level of professionalism from the group that manages the state’s $21.5 billion in permanent funds? Of course they do.

So it makes sense to again ask the Legislature to set minimum professional qualifications, this time for State Investment Council members. And it makes sense to remove the three elected officials — governor, treasurer and land commissioner — from the SIC since they are not required to have any investment qualifications. Credit Gov. Susana Martinez for making those recommendations.

Just consider the complexity of getting a return on investment for billions of dollars via various financial instruments and markets, a return that the state budget depends on annually. Consider the scandals the SIC has faced in years past — it is still trying to recover additional millions lost in an investment pay-to-play scheme under the Gov. Bill Richardson administration. (Richardson maintains he knew nothing about what state investment officer Gary Bland, whom he hired, and insiders Anthony and Marc Correra were doing to steer investments of public money/cash in on “finders fees”; no criminal charges have ever been filed.) And consider four members of the current board — including the treasurer and land commissioner — have refused to sign the SIC’s code of conduct, a standard document SIC officials say simply requires them to act as fiduciaries and put the health of the state investment funds above all else.

After the 2009 scandal, the Legislature changed the makeup of the council — adding two members, reducing the number picked by the governor and giving the Legislature four appointees. And the responsibility for hiring the state investment officer and making investment decisions was moved to the council — an important change that dilutes individual influence, but places a huge workload on council members. Now it’s time to take the SIC to the next level of accountability. Voters overwhelmingly approved qualifications for PRC commissioners — more than 80 percent voted for them in 2012 — because they understood a complex job with huge responsibilities requires more than an elected official’s good intentions.

They deserve at least as much from the officials on their State Investment Council.