Jan. 9—ALBUQUERQUE — New Mexico Attorney General Raúl Torrez aims to block Western New Mexico University’s embattled outgoing president from spending a $1.9 million buyout and is asking a state court to toss his separation agreement.
The university processed the payment to Joseph Shepard on Jan. 2, days before the New Mexico Department of Justice filed an emergency motion seeking to halt it, Torrez announced at a news conference Thursday in Albuquerque. His agency was not informed of the payment until Wednesday, he added.
Torrez said the university concealed the payment’s processing while simultaneously sandbagging the New Mexico Department of Justice’s requests for records during the holiday break.
“We were getting one answer when we were asking for the documents, and that answer is, ‘Everyone’s on break,’ ” Torrez said. “Apparently, the only one not on break is the person who’s responsible for cutting checks at that university.”
The university’s leadership has been embroiled in allegations of misuse of public funds on such things as lavish international trips. Shepard resigned as president last month after an investigation by the State Auditor’s Office found more than $363,000 in wasteful spending and improper use of public funds. His last day is Wednesday.
In addition to the $1.9 million payment, Western’s board of regents guaranteed him a professorship in the School of Business, earning at least $200,000 annually for five years.
“We still have students in this state who have food insecurity, who have housing insecurity,” Torrez said. “And it is absolutely disgraceful that the people who have been entrusted with making sure that they get the education they need to build a better future have instead used that opportunity to enrich themselves, to go on lavish, taxpayer-funded trips and then when they are held to account, to hand out a golden parachute to one of their pals.”
Torrez filed an emergency motion earlier this month in the 6th Judicial District Court in Grant County seeking a temporary restraining order to stop Western from processing the $1.9 buyout. He filed an emergency supplemental motion Thursday asking the court to issue a restraining order blocking Shepard from spending the funds and to impose a constructive trust for the money.
He also filed a complaint seeking to end Shepard’s separation agreement, which the lawsuit calls an “unconscionable contract.”
A hearing to address the initial effort to block the buyout is scheduled Monday. Justice Department spokesperson Chelsea Pitvorec said the agency expects the hearing to also address the supplemental motion to stop Shepard from spending the money.
Shepard’s attorney, John Anderson, wrote in an email Thursday the payment process was handled legally and transparently. Shepard did not expedite his payment, Anderson wrote, and “any allegations to the contrary have no legal or factual basis.”
“His personal frustrations aside, the Attorney General is too talented and too experienced of a lawyer to believe he has any legitimate claim against Dr. Shepard,” Anderson wrote. “The state’s time would be better spent helping the university focus on its important work of educating and supporting its students during this transition.”
Torrez’s new complaint alleges Western’s board of regents improperly directed a subcommittee to negotiate Shepard’s separation agreement, violating the New Mexico Open Meetings Act. It also alleges the agreement violated the anti-donation clause in the state constitution.
Western spokesperson Mario Sanchez wrote in an email the school had been planning to make Shepard’s severance payment the day it was approved, Dec. 20.
“However, the president asked that payment be delayed until January 2, 2025,” Sanchez wrote.
The payment was processed “as a part of regular accounting processes” when Western offices opened after the holiday break, which ran from Dec. 23 through Jan. 1, Sanchez added.
“Western New Mexico University’s legal counsel has been in regular contact with the Attorney General’s Office and has been cooperative to provide documents and insight,” he wrote.
Torrez said his agency would look into how the payment was processed and who did so, though he said he was uncertain what legal action that might lead to.
He noted Shepard, as university president, “had ultimate responsibility for making sure that the finance department expedited payment to himself.”
If the money or a portion of it has been spent, Torrez said, his agency will track it down.
Under significant political pressure, including from Gov. Michelle Lujan Grisham, the majority of Western’s five regents have stepped down. Only student regent Trent Jones remains.
House Speaker Rep. Javier Martínez, D-Albuquerque, who attended Thursday’s news conference, said lawmakers will pursue ways to end the practice of “political appointments.”
“This is about safeguarding the money of the people of the state of New Mexico, and this is about ensuring that no one is above the law,” he said.
The State Auditor’s Office found Shepard spent hundreds of thousands of dollars on domestic and international travel and that regents submitted incomplete or incorrectly calculated travel vouchers. The agency also said Western approved a purchase card for Shepard’s wife, Valerie Plame, who is not an employee.
Plame is an ex-CIA operations officer who ran an unsuccessful campaign for the state’s 3rd Congressional District in the 2020 Democratic primary.
Shepard was appointed to lead the university in April 2011. His base salary at the time the regents voted to terminate his contract was $398,507 — another point of contention for the Department of Justice, which has argued the board agreed to a payment much higher than he was due.
“Under the terms of the Employment Agreement, the absolute maximum the University would have been legally obligated to pay President Shepard if the Board terminated his Employment Agreement without cause was approximately $597,760.50,” states Torrez’s complaint.
Esteban Candelaria is a corps member with Report for America, a national service program that places journalists into local newsrooms. He covers child welfare and the state Children, Youth and Families Department. Learn more about Report for America at reportforamerica.org.