State Helped Roswell Co. Accused of Using Illegals

Colleen Heild, Investigative Reporter, Albuquerque Journal

 

April 20 , 2008

Gov. Bill Richardson and Republican Rep. Dan Foley announced a plan in
February giving Dean Baldwin Painting of Roswell extra time to pay a state tax
bill of more than $500,000.

It was all in the name of saving jobs at one of Roswell's biggest employers,
which paints aircraft, including U.S. military planes.

But federal documents allege that nearly 50 of those jobs in recent years
have gone to illegal immigrants from Mexico and Central America.

Prosecutors allege that the immigrants were "preyed" upon by a company
executive who paid them substandard wages because they were in the country
illegally.

At the time the tax reprieve was announced, the company's executive vice
president for operations was under federal indictment for employing illegal
immigrants. Richardson's office says he didn't know Carl Dean Baldwin was
facing criminal charges, although Foley did.

Federal prosecutors claim that Baldwin knowingly employed the illegal
workers to paint aircraft, including U.S. Air Force C-130 transport planes. He is
also accused of aiding, abetting, harboring and transporting.

"Baldwin stood to gain a greater profit by paying as little as possible to (the
illegal immigrants)," states a recent court filing by the U.S. Attorney's Office. "It
is on the shoulders and backs of these painters that Baldwin Painting advanced
its profit margin."

Baldwin has pleaded not guilty to 10 felony counts. An April 21 trial has been
postponed.

His attorney, Jason Bowles of Albuquerque, said his client denies the charges.

"There is more than meets the eye to this case," Bowles said. "We are
working with the government to try to sort out the true facts of exactly what's
happened."

Richardson spokesman Gilbert Gallegos said the Governor's Office didn't
know about the immigration charges until contacted by a Journal reporter last
week.

"While the governor supports tougher federal enforcement of immigration
laws, he was not aware of these particular indictments," Gallegos said.
Gallegos added that the indictment "has nothing to do with the state's efforts to collect back taxes."

Foley, the House minority whip, approached Richardson seeking his help on
the tax issue. He said he didn't have a specific "conversation" about the federal
indictment with Richardson at that time.

"I don't know how you couldn't be aware of it; it was state news," Foley said
of the federal indictment.

Foley said he's not condoning the hiring of illegal immigrants, if that's what
happened.

"I've had the toughest record on illegal immigration of any legislator. I'm the
first legislator in the country to introduce a comprehensive border security
package," he said.

Government Contracts

Dean Baldwin Painting is a privately owned business specializing in aircraft
strip and paint services, according to its Web site.

Current and recent customers listed on the Web site include Alaska Airlines,
the Dallas Mavericks, Hill Air Force Base, Las Vegas Sands The Venetian, Mesa
Airlines, NASA, Southwest Airlines, United Airlines and US Airways.

Baldwin's indictment last November came more than a year after U.S.
Immigration and Customs Enforcement agents raided the company's hangar at
the Roswell International Air Center.

Fifteen people identified as illegal immigrants were arrested in August 2006,
some as they were painting military aircraft, according to an ICE news release.
Those arrested were from Mexico, El Salvador and Guatemala.

Five illegal immigrants are listed as material witnesses in federal court
documents.

The case is one of a handful of recent criminal prosecutions brought against
New Mexico employers accused of hiring illegal workers.

What makes the case stand out is that Baldwin's company has been a
government contractor, receiving at least $13.7 million in contracts from the
U.S. military in recent years, according to the Web site USAspending.gov.
And the company, over the past nine years, has been a beneficiary of
numerous local, state and federal government efforts to help it prosper in New
Mexico.

CEO Barbara Baldwin said she believes the focus should be on the
company's positives rather than the negatives.

"We're not a Mom and Pop operation, but we are a small business and all
we're trying to do is to prosper and grow," she said last week. She said her
company has 155 to 175 employees, with a payroll of $5 million a year.
Foley said he saw nothing wrong with helping arrange the tax payment plan
because Roswell jobs were in jeopardy— the indictment not withstanding.

"In this country, you're innocent until proven guilty," he said.

Foley also said he has learned that some of those arrested "provided some
sort of documentation in accordance with the law to be there. Whether that
documentation was legal, I don't know."

Meanwhile, the Air Force has suspended Dean Baldwin Painting from
receiving painting contracts.

"The criminal indictment filed against Carl Baldwin is adequate evidence that
he committed crimes indicating a lack of business integrity or business honesty
so as to affect his present responsibility to be a Government contractor ... " Air
Force Deputy General Counsel Steven A. Shaw concluded on Feb. 26.

The Air Force could decide to make the suspension permanent whether or
not Baldwin is convicted. A decision will be made after the prosecution
concludes, a spokesman said.

The company Web site said that more than 230 Air Force C-130 transport
planes have been painted at the Roswell hangar over the past three years.

 

Back taxes 'solution'

Richardson, in a Feb. 8 news release, thanked Foley for alerting him to the
company's tax problem.

The tax bill had accrued while Dean Baldwin challenged the results of an
audit in the courts. The audit concluded that the company shouldn't have taken
certain deductions, and the state Court of Appeals ruled against Dean Baldwin
in October 2007.

The back gross receipts and compensating taxes owed amount to $233,000.
With interest and penalties, the balance is $522,591, according to the state Tax
and Revenue Department.

"While we expect Dean Baldwin to pay what it owes, I am pleased that we
were able to come up with a solution that allows the company to continue to do
business and provide jobs for working families in Chaves County," Richardson
said in the release.

The plan gives the company until November 2012 to pay the balance, said
David Harwell of the state Tax and Revenue Department. No taxes, fees or
other costs were waived or forgiven, he said.

Harwell said the length of a typical repayment plan "varies considerably" but
said the maximum is 60 months.

Barbara Baldwin told the Journal that the state initially gave the company one
year to pay the tax bill. That's when a consultant representing her company met
with Foley, she said.

Foley said he learned from "small business people and economic
development people and the tax and revenue people that the next step was 'we
put a lien on their business.' ''

And that would affect jobs, Foley said.

"Nobody would come park their plane there with a business that has a tax
lien placed on it," Foley added.

Foley, a Roswell insurance broker, said that Carl Baldwin is a neighbor but
that he had no discussions with him or any company official before approaching
Richardson.

Foley, who was first elected in 1998, has received at least $450 in campaign
contributions from the company since 2004. Richardson received a $500
contribution in 2006.

Foley's opponent in the upcoming Republican primary, retired FBI Agent
Dennis Kintigh, has criticized his actions.

"As a taxpayer and former FBI agent, I am deeply troubled that our
representative, Mr. Foley, arranged for corporate welfare to be extended to a
company accused of knowingly and willingly using illegal aliens," Kintigh said.

"Foley arranged this for Dean Baldwin while other New Mexico taxpayers
are expected to pay their taxes on time."

On the local level, Dean Baldwin owes more than $58,000 in back payments
to the city of Roswell on a $525,000 urban development loan issued in 1999.

The company has missed 11 months of payments, city officials say, but made
its March and April payments. It is a month behind in paying its $1,000 monthly
insurance payment on the building it rents from the city.

Assistant City Manager Larry Fry said the company has been "behind at
times" in its payments. But he added, "We have appreciated their presence and
their employment here."

That sentiment was echoed by defense attorney Bowles.

"I think no one would refute that Dean Baldwin is a great corporate citizen
for Roswell," Bowles added. "They make a huge contribution to that
community."

As to the past due loan payments, Fry said, "Certainly, if that money were
repaid, if we had use of that money, it could be used for similar economic
development."

The company's loan balance is more than $477,000.

Barbara Baldwin said she hopes her attorney can renegotiate the loan with
the city. The company has had its "ups and downs" financially, she added, but
always ends up paying what it owes.

 

Immigrant probe

Her son, Carl Dean Baldwin, meanwhile, stands accused of transporting and
harboring five illegal immigrants from 2001 to 2006 and aiding and abetting
their use of false Social Security numbers.

The maximum penalty, if convicted, is 10 years in prison on each of the
aiding and abetting charges. Transporting and harboring charges each carries a maximum five years, said a spokesman for the U.S. Attorney's Office.

A 2006 search warrant affidavit shows federal immigration officials had the
company in their sights since 2002, when Border Patrol agents verified 30
employees as being illegally in the country. As the investigation progressed,
federal agents arrested at least three more illegal immigrants and met with
former employees, the affidavit states.

The affidavit identified a company floor foreman as being from Guatemala.
A man by that name is listed as one of the prosecution's material witnesses.

In a March 25 court filing, prosecutors alleged that Baldwin's "knowledge,
motive and intent is shown through ... the manner by which he paid vulnerable,
undocumented aliens he employed."

Under federal law, employees are supposed to be paid a higher hourly wage
when performing services on military aircraft, federal documents say.

Baldwin paid illegal immigrants "considerably less than called for by the
military contract ... (and) considerably less than the industry standard for
painting commercial aircraft," the filing states.

Carl Baldwin also aided and abetted some of the workers in using fraudulent
employment documents, including social security cards, the filing states.

He is also alleged to have assigned certain "high risk" employees under
immigration scrutiny to night shift work to conceal and shield them from
detection.

At least one illegal worker was transported to an out-of-state work site under
Baldwin's control, "because Roswell ... was 'too hot,' '' according to the filing.
Bowles said the defense disputes those allegations.

He also said that not all of those taken into custody at Dean Baldwin Painting
were in the country illegally.

Barbara Baldwin said the company has improved its background checks of
employees. She hopes the criminal case is resolved soon.

As a defense motion states, "the indictment against (Baldwin) has had a
tremendous adverse financial effect on Dean Baldwin Painting, Inc. ...

"Many (of its employees) are perched on a precarious pecuniary pinnacle
while this case is pending."