January 31, 2020

Legal settlement transparency bill breezes through first committee

Joe Gratz

Flickr/cc

The Senate Public Affairs Committee unanimously approved a measure that would eliminate a confidentiality period for legal settlements made with state departments. 

Sen. Sander Rue, R-Albuquerque, presented SB 64, which would make significant changes to a law that requires a confidentiality period for claims settled with the state. Currently, any claims settled by the state’s Risk Management Division must remain under wraps for 180 days. Rue’s bill not only changes the triggering events that start the 180-day clock, but also eliminates the confidentiality period all together. 

There was little discussion and no debate among panel members during the hearing. Members of the public who spoke in favor of the bill included representatives for good government groups like Common Cause New Mexico and the New Mexico Foundation for Government as well as the Office of the State Auditor. No one spoke against the bill. 

Prior to the committee hearing, Rue told NM Political Report that he decided to sponsor the bill after it was revealed last year that millions of dollars were paid out in secret legal settlements under the previous governor Susana Martinez.

“We wouldn’t be doing this if people were doing the right things,” Rue said. 

NM Political Report has written extensively about that confidentiality period and the ambiguity of when the 180 days starts. The current statute offers up a handful of different events which can trigger the 180 day period, like when the claim is settled, after the statute of limitations has run out, when a claim is placed on “closed status” and when “all appeals and rights to appeal have been exhausted.” 

Both transparency advocates and Rue have said a major problem with current law is that there is too much ambiguity in when the 180-day confidentiality period begins. 

“Right now, people can drive a truck through this thing,” Rue said of the current law.

A long time coming

Even though the Martinez administration’s settlements brought the issue to Rue, the confidentiality period has caused confusion in other instances before they came to light. 

In one case, NM Political Report requested settlement information related to a lawsuit against the New Mexico Corrections Department. The Risk Management Division said the claim wasn’t considered closed until months after the settlement was made official because the division took that long to pay contract defense attorneys. One contract defense attorney previously told NM Political Report that keeping settlements a secret for six months helps to prevent other frivolous lawsuits.   

Shortly after Gov. Michelle Lujan Grisham appointed him to be secretary of the General Services Department, Ken Ortiz told NM Political Report that he was working with Rue to revamp the current law to make it more straight-forward and easier to understand. 

A spokesman for Ortiz said the secretary is in favor of the current version of the bill. 

Open Access NM Director Peter St. Cyr said his organization also supports the bill because it would bring to light wrongdoing by government officials. 

“Secret settlements should be banned,” St. Cyr said. “Government misconduct will persist if details of settlements are kept from the public and whistleblowers are unable to speak out.”

The bill heads next to the Senate Judiciary Committee.