SANTA FE — It’s back to second fiddle for Lt. Gov. Diane Denish.
Denish’s plans and preparations to take over New Mexico’s top job came to a screeching halt on Sunday with Gov. Bill Richardson’s surprise announcement that he won’t be leaving after all.
The Democratic governor, citing an ongoing federal investigation into how some of his political donors won a lucrative state contract, withdrew as President-elect Barack Obama’s nominee for secretary of commerce.
Richardson said he will remain governor for now. He indicated he wants to join the Obama administration later, and Obama said he looked forward to Richardson’s “future service.”
“The governor believes this is temporary and ... he’s confident that he will be cleared in the near future of any wrongdoing,” said Richardson’s spokesman, Gilbert Gallegos.
The decision to withdraw means Richardson would be here for the duration of what could be a difficult legislative session, as lawmakers grapple with major budget problems.
Otherwise, there could have been a switch of governors at some point in the 60-day session, which begins Jan. 20.
“In a way, I think it might be a blessing in disguise,” said House Speaker Ben Lujan, D-Santa Fe, a Richardson ally.
While Denish is “very capable,” the second-term governor likely would have a better handle on where programs could be cut or spending reduced as the Legislature plugs holes in this year’s budget and makes tough decisions for next year, the speaker said.
Denish got the news in a phone call from Richardson on Sunday morning, according to her spokeswoman, Danielle Montoya.
The lieutenant governor was in Washington, D.C., where she planned to meet Monday with New Mexico’s congressional delegation and attend their swearing-in ceremonies on Tuesday, Montoya said.
Richardson was in Santa Fe over the weekend, according to a spokesman. He called some legislative leaders on Sunday about his decision.
A short statement issued by Denish’s office said she and Richardson would continue to work together on budget, economic and other issues.
Denish, a Democrat already running for governor in 2010, would have had a jump-start on the office with Richardson’s departure.
She had put together a transition staff and seven teams of advisers — 125 people from around the state — in areas ranging from government efficiency to healthy families.
Their recommendations on improving government are due Jan. 15.
A slumping economy and lower-than-expected energy prices have caused a $454 million shortfall in the current year’s budget. Closing that gap will be the first order of business for lawmakers. Then they have to write a budget for next year, when the economic outlook remains bleak.
Gallegos, Richardson’s spokesman, said Sunday that the governor’s “ambitious agenda” for the session will first and foremost involve balancing the budget.
“He will continue to focus on creating jobs, keeping New Mexicans safe from drunk drivers and ensuring that our most vulnerable citizens have access to essential services during tough financial times,” Gallegos also said.
Senate President Pro Tem Tim Jennings, a Roswell Democrat who has been an outspoken critic of the governor, said Richardson is a good cheerleader for business and economic development and “would have done a great job as commerce secretary,” including promoting New Mexico.
By the same token, he said, it wouldn’t have been fair for the deficit problems to end up in Denish’s lap.
While Denish could handle it, “is it fair that she’s walking into just a huge train wreck?” he said.
Both Jennings and the Republican leader in the House, Tom Taylor of Farmington, said Richardson’s presence may complicate the process of budget-cutting, since some of the targets for cuts could be programs he promoted.
A Denish administration may not have been as wedded to those programs, Taylor suggested.
“The governor will be working hard to try and keep some of those projects and programs in place,” the GOP leader said.
Denish, who ran with Richardson in 2002 and 2006, has been an active advocate for administration policies, although her relationship with the governor has been cool at times.
She was acting governor while he spent much of 2007 on the road, running for president, and has already collected more than $1.3 million for her 2010 gubernatorial bid.
A federal grand jury is looking into how CDR Financial Products, which contributed at least $110,000 to three political committees formed by Richardson, got a state government contract for which it was paid more than $1.4 million.
Gallegos said Sunday the deal “was handled appropriately and it was thoroughly scrutinized and it went through a rigorous procurement process.”
CDR said in a statement Sunday there was no “pay-for-play” and that it won the contract based on merit.