The Associated Press
ALBUQUERQUE — A former Clovis state representative received about $870,000 in state money that was supposed to benefit a housing program for low- and moderate-income residents, according to a report by the State Investment Council says.
Vincent “Smiley” Gallegos, who resigned Aug. 1 as the executive director of the Albuquerque-based Region III Housing Authority, received the money in salary, retirement benefits and a loan, the Albuquerque Journal reported Saturday in a copyright story.
A Democrat, Gallegos served as District 63 representative from 1987 to 1996, according to the New Mexico Legislature Web site.
The report also says the housing authority wrongly used bond money to purchase vehicles and for office expenses and routinely took out bank loans on properties it was supposed to purchase with bond money.
The State Investment Council began a review of the housing authority after it defaulted in June on payment of $2.5 million in bonds it had sold to the council in 2003. The Investment Council also has declared the authority in default on another $2.5 million in bonds sold to the council in 2004.
At a council meeting Friday, State Investment Officer Gary Bland said he couldn’t say whether problems identified in the report were intentional or criminal.
But, Bland added, “There’s a question of culpability and stupidity here.”
Gallegos, a former state legislator from Clovis, couldn’t be reached for comment. He previously has denied any misuse of housing money provided by the council.
According to the report, Gallegos received about $500,000 in salary from bond money. As of March, he was paid about $158,000 a year.
The housing authority also had made contributions to two retirement plans for Gallegos.
Under one of the plans, similar to a 401(k), the housing authority matched Gallegos 7-to-1, the report said. Gallegos contributed a total of $3,250 to his plan in the first half of 2006 and received a $23,388 match from the housing authority, according to the Investment Council. Gallegos’ contributions in 2005 totaled $10,311, and the authority matched him $25,689.
Other employees received a 1-to-1 match, the report stated.
The housing authority also contributed $23,000 to another retirement plan for Gallegos known as a 457(b) in 2005 and 2006, the report says.
The report also details how $300,000 in bond money was used by the authority last year to make a loan to VSG Enterprises, a company owned by Gallegos.
Gallegos repaid the balance — with interest at 6.25 percent annually — on the day he resigned as executive director, the report says.