RCLC Agrees To Comply With Annual Audits

From the Office of the State Auditor:

SANTA FE – The governing board of the Regional Coalition of LANL Communities (RCLC) has conceded to yearly audits overseen by the Office of the State Auditor (OSA).

The concession came as State Auditor Wayne Johnson released the final report of a special audit after allegations surfaced of misspent public money by the government coalition of several communities surrounding the Los Alamos National Laboratory.

The state entity, formed by a joint powers agreement in 2011, has never undergone a state audit, despite a notice from the OSA in 2013 that audits were required. The special audit designated by Johnson in March resulted in the RCLC formally coming into compliance with the State Audit Act by committing to yearly annual audits as required for any state agency spending public dollars.

“One of my top priorities is to bring public bodies into full compliance with regular audits that provide full transparency of public expenditures,” Johnson said. “The RCLC is just one example of a state agency that has been ignored over the years by the state auditor’s office. I’m going to hold public officials accountable for spending public money, regardless of political affiliation. This office has to take a completely non-partisan approach to holding government officials accountable for how they choose to spend our tax dollars.”

Feb. 20, 2013, the Office of the State Auditor (OSA) notified the RCLC that the entity met the definition of a “special district” and that the entity was subject to the Audit Act. However, this was never enforced and the RCLC skirted public scrutiny until the special audit. Johnson says the RCLC is subject to the Audit Act and should have submitted annual audits to the OSA for FY2015-2017. The special audit brings them current to FY2017, and Johnson says his office will work with the RCLC leadership to begin the audit for the recently completed FY2018.

“The RCLC Board and Los Alamos County have fully agreed that the entity is subject to the State Audit Act and the transparency that comes with regular audits. That’s a win for New Mexicans,” Johnson said. “Sunlight is always the best disinfectant, and yearly audits could have prevented the abuses found by this special audit. As the RCLC former treasurer said, public money should never be spent to conduct every single meeting over a tax-payer funded meal.”

The Special Audit made a number of findings related to the RCLC’s reimbursements for mileage and per diem to public officials. Additionally, the Special Audit notes the RCLC failed to follow its own Travel Policy and contract provisions between the RCLC and the respective contracted executive director with regard to reimbursements for guests, alcoholic beverages and recreational expenses. 

Specifically, the RCLC Board approved reimbursements to both JLH Media, Inc and Andrea Romero Consulting, LLC for meals for board members while the board member was in his or her home jurisdiction. The RCLC also approved improper reimbursement for alcoholic beverages and recreational items (baseball tickets). Hotel reimbursements did not comply with the Travel Policy and there is a lack of adequate documentation to support many expenditures, in the form of itemized receipts, again in violation of the published Travel Policy and state law.

During the course of the special audit, the OSA noted that reimbursements requested for mileage were duplicated by the contracted executive director and its staff. The individuals collected mileage for travel to and from the same location on the same day. The OSA identified twenty-eight (28) instances of duplicate mileage reimbursements.

The Special Audit makes several findings regarding the RCLC Board’s oversight and compliance duties and responsibilities under the Joint Powers Agreement Act. Specifically, the RCLC Board failed to comply with the Joint Powers Agreement Act, the Joint Powers Agreement itself, and the Per Diem and Mileage Act. In addition, the RCLC failed to comply with the Audit Act and the Audit Rule despite being on notice from the State Auditor’s Office as early as 2013 that it was required to do so. Finally, the RCLC issued 1099 statements, which were incorrect and the RCLC budget contained accounting errors, which may have been misleading to the Board.

Johnson’s office has made recommendations for corrective actions. The report includes responses from the RCLC Board and Los Alamos County.

The report can be found here: https://www.saonm.org/audit_reports/detail/11792.


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