Report: County might have tried to hide misspending
Law firm finds fiscal agent made effort to ‘fix,’ recharacterize improper reimbursements
An independent investigation of the beleaguered Regional Coalition of LANL Communities found that Los Alamos County tried to revise existing documents in a possible attempt to conceal thousands of dollars in unlawful reimbursements for meals, liquor and other spending.
In a scathing 38-page report, obtained Thursday by The New Mexican, an Albuquerque-based law firm found that the county, which acted as the taxpayer-funded agency’s fiscal agent, “attempted to correct deficiencies arising from the ill-defined practices regarding RCLC’s governance,
policies, and activities” after the county was alerted to possible misconduct.
The report is the latest rebuke of the coalition and its former executive director, Andrea Romero, a Democrat who is running for election to a seat in the state House of Representatives in November.
The law firm concluded that “corrective” efforts by Los Alamos County, one of several local governments surrounding Los Alamos National Laboratory that make up the coalition, not only reflect poorly on Los Alamos County officials and employees “but may constitute efforts to intentionally mislead others and/ or conceal misconduct.”
The italicized words were included as emphasis by the report’s authors.
“These attempts to ‘fix it’ include, but are not limited to, post hoc recharacterization of money already reimbursed to ARC [Andrea Romero Consulting LLC] as well as an attempt to amend RCLC’s Travel Policy to not only allow the type of impermissible reimbursements that had already been made to ARC (and recharacterized during the attempt to ‘fix it’) but, more concerning, to exempt ARC from being subject to the Travel Policy altogether,” says the report by Adams + Crow Law Firm.
“In this way, the County’s attempts to ‘fix it’ would have purportedly allowed the ‘independent contractor’ serving as RCLC’s Executive Director to do what an employee of RCLC could never do, i.e., to circumvent the law,” the report states.
Romero, who defeated three-term incumbent state Rep. Carl Trujillo in the June primary, faces write-in candidate Heather Nordquist, who is also a Democrat.
Romero declined to comment Thursday. “We’re not commenting on a report we haven’t seen and that’s not public,” Romero’s campaign manager, Neri Holguin, said via text message.
The coalition, formed in 2011 under a joint powers agreement, describes itself as a conduit for Northern New Mexico communities to have a say in government decision-making concerning regional economic development and nuclear cleanup at Los Alamos National Laboratory. The coalition, which comprises nine cities, towns, counties and pueblos, receives about $200,000 a year in public money, half from the U.S. Department of Energy and the rest from varying amounts paid by each member entity.
The Los Alamos County Council commissioned the independent investigation into alleged administrative misconduct by county officials and employees amid revelations of improper expenses and reimbursements made with coalition funds. Not only does Los Alamos County act as the agency’s fiscal agent, it contributes more money — $60,000 — than any other local member.
The report also states that the county might have tried to downplay the extent of the improper reimbursements in an initial audit conducted by the county.
“On February 21, 2018, the County’s Chief Financial Officer, Helen Perraglio, released an informal audit … analyzing over $30,000 in RCLC expenditures and reimbursements during which numerous reimbursements to ARC were adjusted by removing them from a clearly impermissible reimbursement category to a more general category that might not appear to be problematic,” the report states. “As a result of the adjustment, the County Audit found that only $2,246.90 of the $30,000 in reimbursements had been improperly issued to ARC.”
A special audit ordered by New Mexico State Auditor Wayne Johnson and released earlier this week found nearly $26,900 in “improper expenditure payments” to Romero’s consulting company.
However, until that special audit, which reviewed four years of records, the independent investigation commissioned by Los Alamos County was limited to coalition-related expenditures and reimbursements between March 2016 and March 2018.
“Several unconventional reimbursement practices by ARC and RCLC were discovered during the investigation,” the report states. “The circuitous route taken to pay and request reimbursement appears to have been undertaken, in some cases, to circumvent necessary approvals.”
Both assessments uncovered multiple violations of the coalition’s travel policy, including the purchase of alcohol and baseball tickets, as well as the state Per Diem and Mileage Act.
“We have identified multiple instances in which expenses of RCLC and travel reimbursements violated state law and constitutional provisions,” according to the investigative report.
In addition, “there were a number of unanticipated RCLC-related accounting and legal issues that arose during the course of this investigation, potentially implicating RCLC and its Board members,” the report states. “We assume the State Auditor’s investigation and any subsequent government investigations by the NM Attorney General or Department of Finance and Administration will examine potential issues with procurement, Open Meetings Act, and auditing compliance.”
Julie Habiger, a spokeswoman for Los Alamos County, did not return messages seeking comment late Thursday.
Romero, who became the coalition’s executive director in 2015, said in a statement earlier this week that she was “specifically instructed on how to submit receipts by Los Alamos County to pay for board functions and then seek reimbursement, subject to approval of the RCLC Treasurer and Los Alamos County.”
“Should I have gone back and reviewed the organizational documents? Absolutely. I had no reason to doubt the training provided by Los Alamos County, but it was my responsibility to double-check the policies and procedures, and I take full responsibility for that,” Romero said in the statement.
But the independent investigation casts doubt on Romero’s explanation.
“Documentation shows ARC was aware of the RCLC’s Travel Policy and its restrictions at the time the ARC Agreement was made on March 1, 2016,” the report states. “ARC also confirmed knowledge of the Travel Policy in a memorandum from Ms. Romero to [former Deputy County Manager] Brian Bosshardt dated March 20, 2017.”