On The Issues

Hector Balderas has been working hard to strengthen accountability and fight fraud in New Mexico, but there is still more work to be done. As he seeks a second term as State Auditor, Balderas will continue to lead on issues of accountability and push for new tools to ensure that taxpayer dollars are protected.

Balderas is transforming government by introducing and pushing for legislation to make it a crime to obstruct an audit in New Mexico and properly withhold certain public funds from governement agencies who fail to submit an audit of past spending as required by state law.

State Auditors Office Fighting Fraud

Currently, the State Auditor’s office has only 30 employees and one of the smallest budgets of any state department or agency. Hector Balderas created a Special Investigations Division that brings together investigators, accountants and attorneys to target complex cases of fraud, waste and abuse in government.  The SID conducts civil investigations, performs special audits, and provides expertise to law enforcement agencies.

While Balderas has successfully won additional funding to expand the SID, he needs more auditors and investigators to win the fight against fraud and ensure that every cent of government spending is accounted for. If Balderas is reelected, he will push for additional investigators and auditors so that no government agency can escape scrutiny of its finances.1

Scorecard for At-Risk Agencies

When government agencies fail to submit annual financial audits they place public dollars in jeopardy.  State Auditor Balderas launched a program designating agencies “at-risk” of fraud, waste and abuse for failing to submit annual audits in accordance with state law.  As part of the program, “at-risk” agencies are subject to special monitoring by the State Auditor’s Special Investigations Division and are required to submit status reports on their progress in achieving compliance.  The State Auditor also published an “at-risk” agency scorecard to help hold state and local government agencies accountable to taxpayers.

Making At-Risk Agencies Accountable

State and local governments must take immediate action to address audit findings and threats to taxpayer resources.  Hector Balderas instituted a program to closely scrutinize government agencies that mismanage public resources and fail to eliminate fraud risks.  As part of the program, the State Auditor’s staff monitors troubled agencies by conducting on-site interviews of agency personnel.

State Auditor’s Task Force on Rural Accountability

Hector Balderas led a grassroots effort to reform state law to cut costs and increase accountability among rural government agencies across New Mexico.  The State Auditor’s Task Force on Rural Accountability, comprised mostly of local stakeholders, recommended changes to state law that Balderas crafted into legislation.  Passed in the 2009 legislative session, the new law will bring financial relief to rural governments struggling to pay high audit costs.

Protecting Our Public Schools

Currently, the State Auditor lacks the authority to impose penalties on state agencies and departments that are late submitting their audit reports. As a result, in 2009, 90 governmental bodies were late in submitting the audit reports required by law.2  Delays in reporting can allow fraud or embezzlement to go undetected, potentially costing taxpayers hundreds of thousands of dollars.

Recently, the Legislature authorized the state Public Education Department to enforce sanctions on school districts and charter schools that missed accounting deadlines.3  Balderas will fight to extend that law to cover all governmental bodies, so that the State Auditor can impose penalties on those agencies and departments which fail to comply with state law.4

Cracking Down on Large Government Contracts

As Balderas’ audits have revealed, large state contracts are often a tempting target for those who want to use public money for personal gain. That’s why Balderas is proposing a new state law requiring close monitoring and real-time auditing of how money is being spent every time a government agency enters into a construction or service contract worth $1 million or more. Strong oversight regulations will help prevent waste and abuse and dissuade potential fraudsters from trying to steal taxpayer funds.5

Ensuring that State Financial Officers Are Qualified

Currently, the state regulates the standards and conduct of many professionals, like doctors, lawyers, and teachers, but lacks a similar regulatory structure for government financial officers. Balderas believes the state should create a regulatory board to set standards for financial officers and ensure that individuals hired for government finance jobs have the proper qualifications.6

Balderas also wants to ensure that New Mexico government agencies have enough qualified finance officers to monitor spending and guarantee that public money is well-spent. He is advocating for the creation of a specialized program at one of the state universities to train finance and accounting professionals who can take on the difficult task of sifting through financial records to hold government agencies accountable for their spending.7

The New Mexico Fair and Equal Pay Initiative

The New Mexico Fair and Equal Pay Initiative has been instituted in the past two years, through a Pay Equity Task Force convened in 2008, and Executive Order 2009-049, signed by Governor Bill Richardson in December of 2009.  State Auditor Hector Balderas was appointed by the Governor to the planning committee for carrying out  this initiative, which to date has resulted in:

  1. The declaration that Fair and Equal Pay is the official policy of the State of New Mexico
  2. A gender pay equity study of the entire 19,000+ New Mexico state classified workforce which found that:
  • While there are gender pay gaps in most departments of state government, pay disparities between women and men fall significantly below national averages
  • There is no discernable “glass ceiling” in the New Mexico state government, as both women and men are achieving equally in advancement
  • Slightly more of the identified pay gaps favor women
  • There is now a process in place to study gender pay gaps in the New Mexico state government on an annual basis, and to remedy any inequities that are found

A major new phase of the New Mexico Fair and Equal Pay Initiative requires that contractors and bidders for state business file gender pay equity reports. This is the first such initiative in the nation, and is expected to serve as a national model.  The State Auditor continues his involvement through an oversight function to insure that:

  1. Citizens of New Mexico who work for the State of New Mexico and for state contractors are not subject to discrimination in pay.
  2. Contractors report accurately and completely
  3. Our tax dollars are spent with vendors and contractors who pay fairly and do not engage in discrimination.
  4. Savings of tax dollars for public assistance may be realized when companies doing business with the state do not shortchange workers.
  5. Employers may discover disparities they have been unaware of, and will now have an opportunity to remedy them.

References

  1. “More public corruption indictments embolden calls for reform.” The New Mexico Independent, August 19, 2009.
  2. “NM Auditor: $1B In Taxpayer Funds Unaudited.” KOAT-TV, September 29, 2009.
  3. “N.M. Auditor Says $1 Billion in Taxpayer Funds Unaudited.” Associated Press, September 29, 2009.
  4. “State Auditor Ponders Consequences for Late Reports.” The Santa Fe New Mexican, June 23, 2009.
  5. “More public corruption indictments embolden calls for reform.” The New Mexico Independent, August 19, 2009.
  6. “More public corruption indictments embolden calls for reform.” The New Mexico Independent, August 19, 2009.
  7. Ibid.