New Mexico Land Commissioner Aubrey Dunn has a new idea for funding an expansion of early childhood programs in New Mexico.
Dunn wants the federal government to transfer millions of unleased subsurface mineral acres beneath private land to the state, to be set aside in a new trust specifically for early childhood programs like home visiting and child-care assistance. The State Land Office would manage the land much like it already does with a separate trust that helps fund public education.
The proposal, Dunn says, would lead to between 5.3 and 6.5 million acres in the new trust and “could potentially generate a range of $171 million to $210 million in annual royalties.”
The proposal is controversial, having already earned opposition from some conservation groups and others. Dunn, a Republican who has been land commissioner since 2015, isn’t deterred.
“New Mexicans are looking for real solutions to policy issues like early childhood funding – not petty political attacks from special interest groups,” he said. “As opposed to being a ‘quick fix,’ the Early Childhood Land Grant Permanent Fund would grow over time and provide a long-term, sustainable endowment and funding stream for early childhood in New Mexico.”
Dunn made his comments in an interview NMPolitics.net conducted by email — the latest in our Q&A series with people involved in New Mexico politics and government.
Since fiscal year 2011, the state has significantly increased funding for home visiting, which teaches parenting skills and provides other support for pregnant mothers and new parents and guardians. Still, current spending falls short of the estimated need. The debate about how to fund early childhood programs comes as New Mexico ranks 49th in the nation for child well-being.
Some Democratic state lawmakers and progressive organizations have been pushing for years for the state to allocate a small percentage of the existing permanent fund for early childhood programs. Many Republicans, including Gov. Susana Martinez, have rejected the proposal. Dunn took a more measured stance.
“To my knowledge, early childhood advocates are still working on their proposal for a constitutional amendment for 2017, and I am committed to weighing the potential benefits and fund balance impacts of their proposal,” he said. “I recognize the urgent need for early childhood funding in New Mexico. My preference is to increase revenues from other sources, which is why I recently proposed a new state permanent fund for early childhood.”
During the Q&A, Dunn discussed a number of other issues, including his work to increase the access fees the Department of Game and Fish pays the State Land Office, his opposition to the U.S. Bureau of Land Management’s proposed venting and flaring rules, and whether he’s planning to run for governor or any other office in 2018.
“I am running for re-election as land commissioner,” Dunn said. “I believe our system of government was not designed for career politicians, but as a citizen service. As a successful banker, rancher, and real estate investor I bring a different set of skills versus a career politician with no real business experience. The land office is a unique position which gives me an opportunity to repay the benefits given to me as a New Mexican.”
Here’s our full interview, with questions in bold and Dunn’s answers immediately following:
What have you found to be most surprising about the job of state land commissioner since taking office in January 2015? What have you found to be most challenging?
The most surprising aspect of coming into political office and overseeing a government agency were the greatly noticeable differences between private sector and public sector management practices. Prior to my election, I had worked almost entirely in the private sector. I brought over 25 years of business experience with me to the State Land Office and have applied a new approach to management across the agency. In doing so, I have found that the private sector tends to run more efficiently and with less bureaucracy. It is far more challenging to bring real change and enact common-sense policies in the public sector. However, I am lucky to work every day with career staff at the State Land Office who are deeply committed to continuous improvement and have taken on the challenge of working with a new commissioner and management team. When it comes down to it, we are all working together to maximize revenues for our State Trust Land beneficiaries – including public schools.
Under your leadership the State Land Office negotiated a new deal that increases the money the Department of Game and Fish pays for hunters to access state trust land from $200,000 to $1 million each year. Tell us why this was an important issue to take on.
First and foremost, the duty of state land commissioner is to maximize revenue for the beneficiaries of our State Trust Lands. This includes public schools, universities, hospitals and other important state institutions. It is my fiduciary responsibility to receive fair market value for our beneficiaries from anyone who leases or accesses State Trust Lands. At $200,000 per year, the previous hunting easement equated to just two cents per acre. This is in comparison to the $1 per acre that Game and Fish was paying private landowners. I felt that our beneficiaries deserved more in return for providing access to over 8 million acres of good hunting lands, so we negotiated a new $1 million agreement with Game and Fish. As part of the negotiation, I also agreed to allocate several pre-approved camping areas for sportsmen and sportswomen throughout the state, and have ensured that critical access points with clearly marked signage on State Trust Lands remain open and available to licensed hunters, trappers and anglers. This was not a part of prior easement agreements between the State Land Office and the Department of Game and Fish, but we are pleased to be working together with Game and Fish to enhance access opportunities across the state. The additional $800,000 per year that is being generated by the State Land Office will directly benefit public education in New Mexico, and it is important to note that this new easement agreement has not resulted in any increased fees to licensed hunters, trappers or anglers.
You’ve been firm in your opposition to the U.S. Bureau of Land Management’s proposed venting and flaring rules, saying they would put small oil and gas companies out of business and lead to the abandonment of some wells on state trust land. Why?
As mentioned, I have a fiduciary responsibility to our State Trust Land beneficiaries and I take this responsibility very seriously. I have objected to proposed venting and flaring regulations from the U.S. Bureau of Land Management (BLM) on the grounds that they would greatly impact the revenues generated by the State Land Office. Given the state’s distinctive checkerboard division of land ownership, State Trust Lands and corresponding mineral estates are adjacent to or scattered among federal and tribal minerals, and they are contained in multiple federal oil and gas units, communitization agreements and commingling orders. State Land Office revenues are highly dependent on units and communitization agreements, with 82 percent of our oil and gas royalty revenues being derived from such agreements containing both state and federal-governed mineral interests. Therefore, these federal regulations will be applied to the overwhelming majority of oil and gas production activities on State Trust Lands. If BLM’s proposed rules are implemented, the State Land Office will most likely see a large-scale abandonment of oil and gas wells on State Trust Lands because marginal wells will be pushed beyond their economic thresholds. The cost of complying with the regulations will be too great for most energy producers, and the public school children of New Mexico will therefore have considerable financial exposure to BLM’s new regulations. It should be noted that BLM itself is the cause of a significant amount of venting and flaring on federal and tribal lands because of delays in approving permits and rights-of-way for gas gathering lines. If BLM does not allow for gas to be transported from a well via pipeline, or the construction of pipelines is significantly delayed, the gas has to be flared safely. I believe BLM needs to focus on improving their current permitting and rights-of-way processes to prevent venting and flaring before placing new burdens on job-creating industries.
Many believe the state’s economy is too dependent on the oil and gas industry. What can you do as land commissioner, or what are you already doing with state trust lands, to diversify our economy?
Under my administration, revenues to the Land Maintenance Fund – comprised of revenue generated on State Trust Lands through non-oil and gas sources such as grazing fees, rights-of-way, bonus sales, renewable energy and business leases – has increased by nearly $8 million. Non-oil and gas related revenue from the last fiscal year is at its highest amount today compared to the last 20 years. This a direct result of my business-minded approach and execution of commonsense management practices across each income producing division within the State Land Office – most notably within the right-of-way division. When I took office, I learned we had an extensive backlog in our right-of-way division. Over 500 applications were still pending, dating back to 2010. Industry was concerned about the excessive amount of time that it took to process applications, which impacted their ability to move job-creating projects forward on State Trust Lands. Since taking office, we’ve decreased pending applications by nearly 75 percent as a result. Before I arrived at the State Land Office, the average turnaround time for processing rights-of-way applications was 300 days. My administration’s goal is to ensure a 45-day turnaround – and many applications have already been approved within that timeframe. Due to better management, revenue from granting rights-of way has increased by approximately $3 million. In short, I want to send a message to any individuals and entities interested in leasing State Trust Lands – whether from the energy sector or not – that the State Land Office is open for business.
What’s your stance on the SunZia project to build transmission lines – partly across state trust land — that would carry electricity generated from renewable sources in New Mexico and Arizona across the Western United States?
The State Land Office is still waiting for SunZia to apply for a right-of-way to cross State Trust Lands. Until an application is received and reviewed, we cannot move forward on any additional business related to SunZia’s proposed transmission project. In the meantime, following a thorough review, we have developed a more accurate valuation policy for large-scale electric transmission lines. This will ensure that New Mexico’s public school children and other beneficiaries receive their fair share based on the possible impacts of such lines to State Trust Lands. The State Land Office recently contracted with the Center for Applied Research to develop a study called “Valuing Large Scale Electric Transmission Line Right-of-Way Corridors on New Mexico State Trust Lands,” and this has helped to determine a more accurate fair market value for corridors involving transmission lines over 115 kV.
Beneficiaries of state trust land revenue include the state’s public K-12 schools and universities. The state Legislature and governor cut higher education funding once again earlier this year. Do you believe the state’s public grade schools and universities are adequately funded? Why or why not? If not, what can be done to increase funding?
As state land commissioner, my focus is on generating the most revenue possible from State Trust Lands for our beneficiary institutions – including public schools. However, the actual appropriation of state funding for education is the responsibility of the Legislature and the governor and not the role of the land commissioner. I do believe that we will only be able to improve our economy and the overall health of our state by prioritizing and improving student achievement. Therefore, I am strongly committed to growing and maximizing revenues from State Trust Lands, which will in turn continue to provide much-needed funding for public education.
What is your stance on the proposal to take money from the permanent fund to invest in early childhood programs as a long-term approach to improving our state’s outlook?
To my knowledge, early childhood advocates are still working on their proposal for a constitutional amendment for 2017, and I am committed to weighing the potential benefits and fund balance impacts of their proposal. I recognize the urgent need for early childhood funding in New Mexico. My preference is to increase revenues from other sources, which is why I recently proposed a new state permanent fund for early childhood. I believe that we have a unique opportunity to further “grow the pie” for education funding by asking the federal government to transfer any and all unleased federal subsurface mineral acreage beneath private land within New Mexico to the state, which can then be used to generate revenue for the benefit of early childhood. The federal government holds a vast amount of unleased federal subsurface mineral acreage beneath private land within New Mexico – at least 5.3 million acres and potentially upwards of 6.5 million acres. The actual acreage amount is still being identified by the State Land Office. Since my proposal only involves subsurface acreage beneath private land, public land access would not be affected; private landowners already manage the surface above these minerals. In FY 16, the State Land Office earned an average of $32.29 per acre from mining, oil and gas extraction activities across its 13 million subsurface acres. Once transferred from the federal government to the state and leased out by the State Land Office, the approximately 5.3 million to 6.5 million acres currently under consideration for transfer could potentially generate a range of $171 million to $210 million in annual royalties to a new, separate permanent fund that could be established by the state Legislature specifically for early childhood. It is shameful but not surprising that two environmental special interest groups – Conservation Voters New Mexico and New Mexico Wildlife Federation – slammed this proposal in the Albuquerque Journal on August 5. By their own admission, these groups seem to be more concerned about climate issues and keeping money in the hands of the federal government than they are about improving the lives of New Mexico’s children. New Mexico ranks 49th in child well-being and apparently that’s where Conservation Voters New Mexico and New Mexico Wildlife Federation want our kids to stay. New Mexicans are looking for real solutions to policy issues like early childhood funding – not petty political attacks from special interest groups. As opposed to being a “quick fix,” the Early Childhood Land Grant Permanent Fund would grow over time and provide a long-term, sustainable endowment and funding stream for early childhood in New Mexico.
While working to maximize revenue from state trust lands you’ve also spoken about the importance of conserving the land. What are you doing to ensure the millions of acres of land your office manages are preserved for future generations?
The State Land Office should and must use the diversity of resources that State Trust Lands offer for revenue generation today while ensuring that these lands continue to give back to the state for many generations to come. Therefore, my administration is working to enhance trust assets through diligent land management practices. This includes identifying and improving essential and critical watersheds through effective forest management and surface remediation activities. Over the past year, we have completed over 20 watershed health and surface remediation projects of all scales, and we have secured an appropriation of $1.5 million to continue these types of projects in FY 17. I also recently proposed legislation for consideration in 2017 to create a Restoration and Remediation Fund for State Trust Lands, which will provide a permanent recurring fund to address vital projects in New Mexico’s watersheds, forests and other areas in urgent need of attention. Additionally, the State Land Office is working every day with our lessees – who serve as the eyes, ears and the stewards of State Trust Lands – to stay informed about what is happening on the land. We are working to ensure that any individual or entity leasing State Trust Lands is aware of their duty to protect the land and their responsibility to notify us of any concerns involving our lands. My office does not tolerate acts of trespass or other unlawful activities on State Trust Lands, nor do we turn a blind eye to the destruction of these lands by bad actors in any industry.
New Mexico has seen an increase in the number of acres of land preserved by federal wilderness and monument designations during President Barack Obama’s time in office. At the same time, the national Republican Party is seeking the transfer of some land from the federal government to the states. What is your stance on wilderness and monument designations – and especially the massive Organ Mountains-Desert Peaks National Monument designation that encompasses much of the land surrounding Las Cruces? Do you think some federal lands should be transferred to the states?
In total, the federal government has set aside 162,000 acres of State Trust Lands in recent years for national monuments, wilderness study areas and conservation agreements for threatened species in New Mexico. This includes the Organ Mountains-Desert Peaks National Monument designation. These State Trust Lands were originally set aside by Congress in the Enabling Act of 1910 for the benefit of public schools, universities, hospitals and other important institutions in New Mexico. The transfer or exchange of an equivalent amount of federal acreage from BLM to the State Land Office would ensure that our State Trust Lands remain whole and intact as we seek to protect much-needed revenues for public schools. I am pleased that Senator Udall and Senator Heinrich have proposed legislation to direct the U.S. secretary of the interior to work with the State Land Office to enter into a land exchange agreement to address State Trust Lands that are being locked up in the Organ Mountains-Desert Peaks National Monument. I look forward to working with our congressional delegation and BLM to ensure that other State Trust Land sections impacted by federal actions are exchanged, as well. On the issue of federal lands transfers to the state, the only such transfer that I have proposed – outside of compensating New Mexico for State Trust Lands locked up in federal wilderness and monument designations – is the transfer of unleased federal subsurface mineral acreage beneath private land within New Mexico for the benefit of early childhood.
The Albuquerque Journal recently slammed your office in an editorial after reporting that Deputy Land Commissioner Laura Riley may have violated the office’s code of conduct that prohibits employees from acting as an agent for the lease of state trust lands. In her capacity as a real estate broker and appraiser, the Journal reported, Riley was doing business with the land office. Assistant Land Commissioner Patrick Killen responded with this statement: “We can’t help but believe that this effort to question Deputy Commissioner Riley’s service to our state is politically motivated by Commissioner Dunn’s opponents and possibly even sexist in nature, and it serves as a chilling reminder that these kinds of baseless attacks are still a fact of life for many women serving in positions of authority in New Mexico.” Can you elaborate on why you and your office believe Riley’s actions are being unfairly questioned?
Consistent with the State Land Office’s Code of Conduct, Deputy Commissioner Riley signed and submitted a Certificate Regarding Conflict of Interest and a Disclosure of Outside Employment on April 15, 2015. Both of these documents are on file with our Human Resources Department. Deputy Commissioner Riley properly and fully disclosed on the forms – over a year ago – that she sometimes serves as a third-party transaction broker in real estate sales and, at times, those transactions may include State Trust Land leaseholds. Following the Albuquerque Journal’s initial Inspection of Public Records Act request related to this inquiry, career attorneys in our Office of General Counsel reviewed this matter further and concluded that there had been no conflicts. At the end of the day, Deputy Commissioner Riley’s extensive land management experience and work ethic speaks for itself. She has served at the State Land Office under commissioners from both the Republican and Democratic parties, and she is well respected by government, community and business leaders across our state and across the political spectrum. There should be little doubt that Deputy Commissioner Riley and the rest of our team at the State Land Office are fully committed to working tirelessly on behalf of our public schools, universities and other important institutions.
Are you considering running for governor in 2018? Are you considering running for any other offices in 2018 or beyond, such as U.S. Senate or U.S. House?
Thanks for the question. I am running for re-election as land commissioner. I believe our system of government was not designed for career politicians, but as a citizen service. As a successful banker, rancher, and real estate investor I bring a different set of skills versus a career politician with no real business experience. The land office is a unique position which gives me an opportunity to repay the benefits given to me as a New Mexican.
I am grateful to the people of New Mexico for giving me the opportunity to serve.
My current task is to act as the trustee for the children of New Mexico in managing lands given to them and to conserve for future generations.