UNM on track to collect Pit suite rentals

Officials list steps taken to ‘clean things up’ in Athletics Department

Administrators at the University of New Mexico say all Dreamstyle Arena – the Pit suite holders paid their bills for the 2017-18 season, and collections for the current season are heading in the same direction, thanks to changes made after a series of financial scandals rocked the Athletics Department.

Haphazard collections and a lack of written agreements with suite holders between 2010 and 2017 cost the university around $200,000 in lost suite revenue, but university officials say new tracking and collection systems have fixed the problem.

That is one of several improvements UNM says it has put in place in the past year, according to a letter sent to

the state Attorney General’s Office on Friday in response to a scathing report the AG issued earlier this month.

In the response letter and in a meeting with Journal editors and reporters on Tuesday, university officials said they have instituted a number of reforms, which were not reflected in the AG’s report.

“So much of what is out there now has been largely corrected or is about to be corrected,” UNM President Garnett Stokes told the Journal. “In the most recent (report) from the attorney general, which we have responded to, it doesn’t seem there is awareness that we have taken considerable steps to clean things up.”

Hector Balderas’ office distributed the report on UNM’s “financial risk areas” on Feb. 6 — the same day it charged former UNM Athletics Director Paul Krebs with fraud, money laundering and three other felonies in connection with a now-notorious 2015 Lobo athletics fundraising golf trip to Scotland. UNM spent about $64,000 in public money on the trip, including about $25,000 to help pay for three private donors to attend.

The report, authored by Assistant Attorney General Dylan Lange, reiterated many issues outlined in a 2017 special audit conducted by the Office of the State Auditor.

Lange’s report said “it is clear that UNM has created a financial control environment ripe for public employees to violate state laws and abuse public resources, without any ability to be tracked, identified, or ultimately held responsible.”

UNM Chief Legal Counsel Loretta Martinez responded in the Feb. 15 letter that UNM has taken several steps to address problems identified more than a year ago by then-State Auditor Tim Keller and in UNM’s own internal audits, and that the attorney general’s report is based on old news.

“Although not all areas of concern have been fully addressed as yet, the effort is well under way and is expected to be complete in the near future,” she wrote. “Most of the instances that your report describes happened some time ago, and thus we believe that the observations you make about the ‘culture and environment at the management and oversight level of UNM’ do not accurately reflect the current state of controls and fiscal oversight at UNM.”

Balderas late Wednesday responded with a statement that his office “will continue to monitor UNM and is always interested in corrective action taken by the University.

“It is important for high-ranking UNM officials to not minimize or dismiss past bad acts and abuses that created an environment for criminal activity. We look forward to working proactively with the UNM administration and the new regents,” he said.

Stokes, who is about to complete her first year as president, said the university is “putting in place a lot of changes in the way business is done day-to-day.”

“To the extent that things weren’t documented before, they are documented now,” Stokes said. “It’s hard for me to go back and speak about the past because I don’t have all the details about it. I don’t believe (the AG) would be able to make those accusations about the things we’re doing or have been doing over the past year.”

Athletics Director Eddie Nuñez said the Lobo Club — the athletics fundraising entity that handles the Pit suite billing and collections — restructured its processes at UNM’s direction to ensure agreements and tracking of Pit suite rentals are in place.

UNM told Keller’s office in 2017 it was working on new memorandums of agreement with the Lobo Club and the UNM Foundation that would clearly define each entity’s role and that it aimed to have them in place after a new UNM president started. Nuñez said Tuesday that a new agreement with the Lobo Club should be completed within a month.

The new agreements give UNM more oversight of both entities, Stokes said. And Stokes said she has asked university counsel to review the agreements with all of the university’s affiliated organizations.

The university also has addressed concerns that it vested too much authority in one position — the executive vice president for administration/ chief financial officer/chief operating officer position last held by David Harris. Harris retired in December, and UNM has changed the position to senior vice president for finance and administration and is currently conducting a national search to fill it. The chosen candidate will not have “the multitude of responsibilities” Harris had, and “it is anticipated that this reorganization will, indeed, strengthen UNM’s ability to ensure compliance with state law and UNM policy,” UNM counsel Martinez wrote in her letter to the AG.

Both the state auditor and Attorney General’s Office also indicated the circular flow of money among UNM, the Lobo Club and the University of New Mexico Foundation, the university’s main fundraising entity, created tracking and accountability problems and contributed to failed Pit suite collections.

Martinez’ letter also notes that the university addressed some of the state auditor’s concerns by hiring “a permanent Athletics Department CFO more than a year ago.”

But that CFO, Rob Robinson, left last month after about a year on the job. And while Nuñez said UNM is seeking his replacement, the new hire will not have a CFO title, but be a “businessminded individual” who will scrutinize purchases.

There are now several more layers of oversight so expenses are approved by both athletic and main campus finance officials. Nuñez said the department also has eliminated about three-quarters of the “P-cards” personnel used for purchases, and only essential personnel have those cards. And again, all charges are approved by several people.

Nuñez also noted that the athletics department is making progress on its budget.

“We’re moving in the right direction with everything regarding the budget ... ” Nuñez said. “It’s taken a lot of effort and hard work ... We’ve become more efficient in the way we do business. It’s been a challenge, but I’m proud of it.”