Oversight of biz startup funds questioned

The director of the Tucumcari’s economic development arm said during a city commission work session Thursday that no reports on a state grant program for small businesses have been produced since at least 2018, and he wondered whether those funds were being used for their intended purposes.

Tucumcari’s city manager, however, said after the meeting she wasn’t worried about the possible misuse of those funds and regularly reported that fund’s balance since being hired in August. She also plans to give a more complete report at the economic development group’s next meeting this week.

Patrick Vanderpool, executive director of the Greater Tucumcari Economic Development Corp., laid out the local history of the state’s Local Economic Development Act that provides grant funding to small businesses.

Vanderpool wasn’t on the commission’s work session agenda but was prompted to give a report after city manager Paula Chacon reported during a previous meeting that an entity may want to move into a broom factory building occupied by another tenant, Glenn Lubera of 3D Shovel and 3D Broom. Chacon had said Lubera wasn’t complying with the city’s LEDA agreement from 2016.

Vanderpool said the city began using LEDA funds for startup business projects in 2016 to 2018, despite the objections from then-city attorney Randy Knudson.

Vanderpool noted several successes with the program that include Tucumcari Mountain Cheese, Mariposa Herbs and the Fairfield Inn & Suites by Marriott.

But one notable failure was $50,000 in LEDA funds given to the Firelight flashlight company. The company ended up moving to Tennessee, and a bankruptcy filing kept the city from recovering those funds, Vanderpool said.

After Firelight failed, Vanderpool said the city tightened the criteria in issuing LEDA funds. He said LEDA funds can’t be the sole funding source of a business launching here.

Possibly because of the disruption caused by the COVID-19 pandemic, Vanderpool said no report on LEDA fund balances and funds encumbered has been issued since Jared Langenegger was city manager, which was from 2014 to 2018. Tucumcari has employed three other city managers since that time.

Chacon said Friday she would present a more complete LEDA report at Greater Tucumcari EDC’s meeting this week.

Vanderpool also wondered whether LEDA funds were being used for their intended purposes, including the possibility of them being used “above and beyond the allowed amounts.” He did not specify which business might be misusing those funds.

Interviewed in her office after the commission meeting, Chacon disputed a couple of Vanderpool’s allegations. She said she regularly provides LEDA fund balances at monthly Tucumcari EDC meetings.

“I’m not worried about the misuse of (LEDA) funds,” she added, though she again asserted that 3D Shovel is not in compliance with its local LEDA pact.

Commissioner Christopher Arias said if 3D Shovel is not meeting the demands of its LEDA contract, it needs to vacate the broom factory building.

Vanderpool pointed out he is not a law-enforcement officer. But Mayor Ralph Moya said the city should press the tenant and enforce the contract.

Vanderpool and Chacon said Friday a tentative agreement had been reached with 3D Shovel’s owner. The company’s remaining inventory would be sold to satisfy the LEDA agreement, and the broom factory building would be vacated for another possible tenant.

Vanderpool noted state law regarding LEDA funds had removed a non-compete clause two years ago. That would make it easier for municipalities to give funds to new retail businesses. He said, however, the city lacked an ordinance to give LEDA funds to such businesses. He also said issuing such funds would require a public referendum.

Chacon disputed that after the meeting, saying she consulted with Quay County Clerk Ellen White and concluded such a referendum was not needed.

Chacon said responsibility for the local LEDA program should be shared between the state and the city.

Commissioner Mike Cherry also said he would oppose giving tax dollars to new retail businesses that would compete against longstanding retail businesses in Tucumcari.

Vanderpool said prospective employers no longer are looking at build-to-suit options for facilities because of escalating construction costs. He said several want a 10,000-square-foot building on South First Street near Interstate 40, but none exists in that location.

Regarding housing, Vanderpool said one individual is rehabbing vacant homes in the city, and another from Angel Fire is looking at building modular homes here.

Other action

— Commissioners approved a project change order for the Gamble Addition street improvement project.

Project manager Ralph Lopez said the project is mostly done, and enough funds remain to redo a half-block of Nobles Avenue between Jackson and Rock Island streets. Another $65,000 in city infrastructure gross receipts tax funds would complete the other half-block, and Lopez said the amount actually spent might be lower. Lopez said the project is ahead of schedule.

— Commissioners approved a contract amendment between the city and the Non-Metro Area Agency of Aging.

Tucumcari Senior Center manager Clara Rey said the agency had excess funds and would provide an additional $11,000 to help cover the center’s costs for home-delivered meals through the end of the fiscal year on June 30. Rey said the additional money was needed to cover higher costs of fuel, food and special containers for the delivered meals.

— Commissioners approved the appointment of James Lott, Alice Lopez, Duane Harb, Mary Elebario and Debbie Thomas to the Tucumcari Senior Center Advisory Board.

— The commission recognized volunteers for the Foster Grandparent and Senior Companion programs and senior center drivers.

The volunteers are Marilyn Cheney, Mary Elebario, Helen Garcia, Nola Hendrickson, Alfred Johnson, Connie Lucero, Theresa Martinez, Gloria Maverick, Mary Martiel, Betty Munoz, Laura Naylor, Cleo Pacheco, Robert Padilla and Maribel Todd.

The senior center drivers who make deliveries are Gary Cooper and Richard Rust.

— The commission went into a 15-minute closed executive session to discuss pending or threatened litigation. No action was taken when open session resumed.

Work session

Other items from the work session:

— Commissioners agreed to conduct interviews of District 3 commissioner candidates at 10 a.m. May 8. Applications for the position will be taken through April 20.

The District 3 seat has been vacant since December, when Ruth Ann Litchfield resigned due to health reasons. The commission in January chose Matt Bednorz to fill the seat, but it later was found he did not live in the district. Arias filed a lawsuit to block Bednorz from being seated, and Bednorz stepped down.

During public comments, resident Tonya Rigdon criticized the commission’s infighting and lack of action in appointing a commissioner.

“It sounds like you have someone else in mind you want hand-picked,” she said.

Ridgon also said commissioners are “fighting against everything” the city manager does, and they should have not rejected the purchases of new equipment for the landfill and cemetery.

— Chacon spoke briefly about the city’s fiscal-year 2024 budget. She said she had the current fiscal year’s numbers only through March, and “I’m being very cautious until I see the revenue.”

Moya suggested a breakdown of revenue numbers from regular business licenses and cannabis licenses. He also urged the creation of a fund to clean up derelict properties.

Chacon said she soon would schedule a work session to discuss only the FY24 budget.

Manager’s report

Items from Chacon’s regular report to the commission:

— Chacon said she still hasn’t received an easement from the KOA Campground’s owner so the city can replace a nearby sewer lift station.

Lopez the campground’s operator is being “cautious” and has contacted KOA headquarters for approval of the easement.

“It’s not in his best interest not to sign it,” Lopez said. “If that lift station quits, he has no alternative but to fix it. He would be shut down without that.”

— Chacon said she is “hitting it hard” to have Tucumcari Municipal Pool repaired and reopened by summer, including using state cooperative contracts to expedite the work.

— Lopez said Tucumcari Municipal Airport is short nearly $1 million to install a fuel farm because of rising costs, despite a $1.3 million state grant for it last year. He said officials are looking at other options to cover the shortfall.

— Chacon said she soon will meet with engineers about the proposed wastewater reuse project. The project is about $4 million short in starting it, but “promising” funding sources might be available.

— She said bids for street repairs in the Aber Addition would be let in May, with a projected start date in June.

— Chacon said she was meeting with Xcel Energy officials about replacing lights at Dunn Park.

— Chacon said Great Blocks funds will be used to repair an alley near Second Street downtown, plus install irrigation systems and filling planters.

— Chacon mentioned she has been more vigilant about cleaning city-owned properties. “I feel we need to lead by example,” she said.

Comments

— Scott Crotzer, director of the Tucumcari/Quay County Chamber of Commerce, said former local artist Doug Quarles will return to Tucumcari this week to repaint murals on the chamber’s building. The cost will be covered by a grant. Quarles also will assess the condition of his other murals in town.

Crotzer also said the chamber’s website will be relaunched in about two weeks.

— During commissioner comments, Paul Villanueva said the closed Tucumcari Inn motel is being used as a dumping ground.

— Moya said Tucumcari is progressing due to new residents and improved city finances, but it takes time for city government to complete work that was deferred for years.

“All I ask is the residents be a little patient with us,” he said.