Without funding, interchange work will stop

April 06, 2010

Construction work on the North Belen interchange will shut down by July if the developer of Rancho Cielo doesn’t come through with its portion to complete the project.

Using a $3-million state appropriation, the New Mexico Department of Transportation (NMDOT) has continued the reconstruction of the interchange despite not having Coast Range Investment’s contribution, which would be approximately $4 million.

As the state appropriation runs dry, NMDOT will demobilize the construction crew and halt the work.

Jim Wood, vice president with Coast Range Investments, said at last night’s Belen City Council meeting that his company won’t have the money to complete the interchange unless it has a “user” for land within Rancho Cielo.

Signet Solar was expected to be the first user in Rancho Cielo, but the solar company was unable to secure a federal loan guarantee to back funding for construction of its manufacturing facility.

The State of New Mexico, City of Belen and Coast Range Investments, with the latter operating under the subsidiary New Mexico Development Partners (NMDP), signed a three-party agreement explaining the various roles and financial obligations of each entity related to the interchange project.

According to that agreement, the State of New Mexico contributed $4 million to the project, which included approximately $1 million for design and planning and $3 million for construction.

Under that same agreement, New Mexico Development Partners committed to funding any remaining project costs.

“NMDP will provide funding for project costs that exceed this $4,000,000.00, based upon the project estimates, in escrow prior to letting of the construction project,” a section of the agreement reads.

Coast Range Investments never placed its contribution in escrow prior to construction, and now, through an attorney, it disputes that it has any legal obligation under the agreement to provide the funding.

Should NMDOT stop construction on the interchange because of a lack of funding, Tamara Haas, an NMDOT district engineer, told the city council it will need to rebid the remaining construction work.

Posted in: Economy Infrastructure Rancho Cielo