Teague Skirts Details About His Income

Posted October 5, 2010 at 6:34pm

Correction Appended

Rep. Harry Teague, who made millions in the oil industry before coming to Congress, launched a new ad campaign this week claiming he has not “accepted a penny” from his company in 21 months. The ads are part of the New Mexico Democrat’s response to recent criticism from his GOP opponent that he cut health care benefits for his employees while accepting hefty profits.

But according to Teague’s personal financial disclosure statement for 2009, his wife, Nancy Teague, who works as an adviser to the company, earned a $120,000 salary from Teaco Energy Services in 2009, the oil services firm Teague founded in 2000.

And while Teague, ranked 12th on Roll Call’s 50 Richest Members of Congress list, did not take any money from Teaco in that time, he did make as much as $2 million in income from two other companies he has ownership in.

The issue has come up in Teague’s competitive re-election campaign against former Rep. Steve Pearce (R). The race for the Republican-leaning district is close­; an Albuquerque Journal poll last week found Pearce leading by just 1 point, which was within the margin of error.

Pearce slammed Teague’s business practices in a TV ad launched last week. In it, he criticized Teague for taking a $3 million bonus in 2008, then cutting health care benefits for Teaco employees “four days before Christmas” in 2009.

The Pearce ad did not make clear how far apart the two actions were, but Teague did not deny making the cuts or taking the payout.

Instead, Teague responded quickly with a radio and TV ad, explaining that if he had not cut health care benefits, the company he would have been forced to lay off 200 employees, and that he has accepted “no salary, no bonuses, not a penny” from “our company” since coming to Congress in 2009. He does not refer to the company by name in the ad.

“We made cuts, but we kept 200 people working so they could take care of their families,” Teague says in the TV ad.

The 2008 payment was a dividend payment, not a bonus, Teague spokeswoman Jessica Borchert said. Employees were informed of the cuts at the beginning of 2010 and benefits were cut in March, she said.

While Teague’s wife was collecting her salary from Teaco last year, the Congressman was also earning income from two other companies: Tactical Security Solutions, in which he holds a partnership interest, and Teago LLC, a real estate company he owns with his adult children and that has no employees.

According to the amended personal financial disclosure report he filed on Sept. 15, Teague made $100,001 to $1 million from each company in 2009. Although Teague listed those figures as income, Borchert said those figures were “earnings by the company and reinvested back into the company.”

In 2008, when Teague was making his first bid for Congress, he received money from Teaco Energy Services in three different forms. He received an annual salary of almost $138,000, as well as the dividend income of nearly $3.4 million. Teague also received a personal loan from the company, valued at $1 million to $5 million.

On top of his Teaco income that year, Teague reported earning just less than $500,000 from Tactical Security Solutions and just more than $200,000 from Teago LLC. His wife also brought in just less than $118,000 in salary from Teaco.

Pearce left the 2nd district seat in 2008 to run for Senate. Teague then defeated Edward Tinsley (R) with 56 percent in the race to fill the open seat. Teague’s campaign spent $3.2 million on the race, including nearly $1.8 million that Teague loaned the campaign.

In this year’s race against Pearce, Teague raised $1.5 million in the first half of 2010, none of which came from his own pocket.

Pearce also worked in the oil services industry before selling his company in 2003. Roll Call reported in 2008 that Pearce appeared to have sold his own company for far more than the value he had estimated for it. Teague’s latest radio ad criticizes Pearce’s sale after defending his own actions.

“Congressman Steve Pearce used his influence in Congress to cut a backroom deal so he could sell his own company for millions more than it was worth,” the ad’s announcer says.

Pearce has contended that there was nothing untoward about the sale of his company.

Correction: Oct. 6, 2010

The article misidentified the companies owned by Rep. Harry Teague. The oil services firm he owns is Teaco Energy Services, and the real estate company he owns with his children is Teago LLC.