For the Nov. 7 New Mexico general election, SFR called candidates to test their knowledge. The rules for Pop Quiz were as follows: No research allowed and if they call back later with the right answer, too bad. To see who answered correctly (or came closest), check out our answer keys below.
Questions:
1. What specifically can be done to the Treasurer's Office so that problems like the Robert Vigil scandal never happen again?
2. What are the three fundamental principles the state cash manager must use when investing money in the custody of the state treasurer?
3. Who may participate in the New MexiGROW Local Government Investment Pool (LGIP)?
4. Rappers Puff Daddy and Notorious BIG discussed the pitfalls of being rich in the hit song "Mo' Money Mo' Problems." Do you believe that particular mantra to be true?
5. What was the worst financial investment or decision you ever made?
Answers:
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James Lewis (Democrat), 58, is a former New Mexico state treasurer, among other governmental posts.
1. Well, there are a couple of things. If we look at our Constitution, we need to follow the statutes: Thou shall not lie or steal. And we need to take advantage of the checks and balances in our state government. Also, the citizens of this state need to look at the quality of the people they're electing. Finally, we need a code of conduct and ethics training program. We also need a whistle-blower program, so that people can stand up and speak out.
2. Basically, No. 1 is safety. You need to make sure you're investing in safe securities. You also need to look at liquidity. And you need to make sure the money is there to make sure there's going to be a return. Also, you need a prudent person who can wisely take care of fiduciary action.
3. Actually, when it was set up for the state, I had the law amended and changed. Now we have local governments that can participate-cities, counties, special districts can participate too. It's also possible that tribes can participate too.
4. Uh, I don't know. I guess. If you look at the analogy, if you hit the lottery and all of a sudden, you got everybody talking to you-friends, family-then you have some problems.
5. Personally? Well, I guess the worst decision is not being able to look at the market on a regular basis because of the jobs I've had. Not being able to look at equity and those things. I feel like I've lost money when I probably could have made more. It's one of those things where I just didn't have time to really watch the market. But if you're going to get in there, then you ought to make time to do it.
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Demesia Padilla (Republican), 46, is a certified public accountant.
1. Um, tighten internal controls and give oversight from the different bodies. Either the Legislative Finance Committee or the Board of Finance. Just some oversight so we have checks and balance.
2. They have to know what their cash needs are. They have to know what the cash flow is in terms of receipts. And they have to make sure you have the proper collateral you are investing in.
3. Uh, all government entities, stage agencies and tribal entities. Let's see. Who else? I believe they're the only ones.
4. More money, more problems. Yes, if it's not properly managed.
5. The worst decision I've ever made? Enron! I bought some stock in Enron, and I didn't sell it soon enough.
SFR Key
2. The state cash manager invests money in the custody of the treasurer that is not needed right away for government operations. As such, all investments must follow three guiding principals: safety, liquidity and yield.
3. Eligible participants in New MexiGROW LGIP include school districts, post-secondary educational institutions, special purpose districts, cities, counties, tribal governments and pueblos.