Journal Looks at Insider Contract Overruns

How many more pay-to-play scandals can one state take? That’s got to be the question on everyone’s mind. Just when we thought the dust was beginning to settle, it looks like the Albuquerque Journal is on the trail of yet another eyebrow raising contract given to a Governor Richardson insider:

The University of New Mexico is paying more than double the initial estimate to a politically connected firm it hired three years ago to provide security services for its main and south campuses.

In a memo recommending approval of the contract for Santa Fe Protective Services, UNM regents were informed the cost for the four-year contract was “estimated at approximately $500,000 a year.”

But UNM paid the company more than $1 million for the 2007 calendar year and more than $1.1 million for 2008. The university is on pace to spend even more this year, having already paid the company more than $800,000.

It’s the fact that the payment is more than double the contract that makes this worthy of a second look. Security services at UNM is not something new, so there should be a track record of expenses for securing those services. Expect to see a follow-up story that examines these new expenditures to those in year’s past.

And, in case you’re thinking there’s nothing here but smoke, you might want to take a second look at the way the story ends:

About seven months after regents voted to award UNM’s security contract to Santa Fe Protective Services, the company switched part of its insurance business to Daniels Insurance Company.

Jamie Koch of Santa Fe is president of Daniels Insurance and at the time was president of the regents. Daniels Insurance became the company’s broker for auto liability and workers compensation and employers’ liability.

Koch said the awarding of the UNM contract and the company’s decision to go with Daniels Insurance were unrelated. He said he doesn’t feel there is a conflict because the regents’ vote on the security contract took place months before Daniels Insurance was providing insurance to the company.

Oh, he waited a few months before “earning” their business. My bad. This is obviously all on the up and up.

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