MRCOG to help county as fiscal agent


A million dollars for Valencia County infrastructure projects hangs in the balance as county commissioners scurry to meet New Mexico Department of Finance and Administration demands.

Due to a sub-par audit with 22 findings for the 2011-12 fiscal year, the county is now required to have a fiscal agent oversee its capital outlay funding for this year.

After legislative appropriations were approved by Gov. Susana Martinez earlier this year, she then signed an executive order in May stating that counties and cities with significant audit deficiencies could not receive the money already approved.

For Valencia County, this represents $1,040,000.

The funds were not included in the June bond sale, which leaves December's sale as the county's last chance to secure the funds.

Commission Chairman Charles Eaton said the county opted to ask the Mid-Region Council of Governments to be its fiscal agent. MRCOG agreed and its executive director, Dewey Cave, presented a memorandum of agreement to commissioners last Wednesday.

"This is new territory for us," said Cave. "Unfortunately, you all are having to go through this process, and it's a new process for us as well.

"We have been involved in being the fiscal agent for some nonprofits as well as fiscal agent for some boards, but this will be the first time we've acted as fiscal agents for another governmental agency."

Cave said they weren't even sure what "fiscal agent" actually means in this circumstance, so they put together a memorandum of agreement, rather than a contract since it is between two governmental agencies.

"I want to assure you that our intent as part of this MOA is not for us to take over management of any processes that the county has," he said.

The agreement says Mid-Region Council of Governments will oversee procurement processes and, in the scope of services the DFA defined, the agreement identifies what MRCOG would do, and also what county staff would be accountable for, he said.

"We're dealing with audit findings from back in 2006," said Eaton. "Some of them date back even earlier from an earlier administration."

The findings on the audit were basically that the county didn't have sufficient internal controls for checks and balances in handling its finances.

No money was ever missing from the county's coffers, but preventative measures weren't up to snuff.

The county's two main audit deficiencies are reconciling cash accounts with financial statements and properly depreciating fixed assets such as roads and buildings.

But county accountants are showing a lot of progress in remedying the situation, said Nick Telles, the county's finance director and interim county manager.

The county has resolved many of the 22 findings, but due to a clash in the audit schedule and the fiscal year budget schedule, the corrections might not be on the books in time to prevent a further delay of capital outlay money.

If the county has MRCOG as a fiscal agent, it might be able to salvage funding through the December bond sale, Eaton said.

Commissioner Alicia Aguilar expressed concern about having the agreement with Mid-Region Council of Governments in place in time for the bond sale.

"We're in uncharted territories in this kind of situation," said Telles. "All I can say is the Mid-Region Council of Governments has been very willing to assist us."

Drafts of the agreements by MRCOG were due Oct. 31, but then DFA extended the deadline to the first week of November. Now the department is adding a set of guidelines to follow.

Cave said he isn't sure if MRGOG's agreement will meet those guidelines or not.

"We will need to go back and see what those guidelines will be before we can actually get you all to adopt this agreement," he said.

Meanwhile, he has given a draft of the agreement to the department of finance to see if it would be acceptable.

This is happening all over the state with other counties, and Commissioner Mary Andersen thanked MRCOG for assisting Valencia County.

"Because this has been a big blow to Valencia County," said Andersen, "as you know, it's been a big blow to about 20 other counties, I think, in the state."

Sen. Michael Sanchez (D-District 29) and Rep. Don Tripp (R-District 49) support and endorse the intent of the commission to enter into an agreement with MRCOG, said Eaton.

"This is really, really important," said Eaton.

Rep. Kelly Fajardo (R-District 7) also expressed support, said Telles.

The services provided by Mid-Region Council of Governments cannot be paid with capital outlay funds, so the county will have to consider that when they budget the capital outlay money, said Andersen.

There will be a special meeting to consider the agreement with the Mid-Region Council of Governments at 9 a.m., Wednesday, Oct. 30.

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