At a time when his office is dealing with budget cuts, State Auditor Tim Keller says a better funded State Auditor’s Office “would be the single best way to protect taxpayer dollars in New Mexico.”
Keller joins past auditors in saying the office needs more resources to effectively root out government waste, fraud and abuse in New Mexico.
“If our state wants to be serious about ensuring accountability and effectively fighting fraud, waste and abuse, we need to provide the resources to do so,” Keller said.
The auditor’s comments came in an extensive interview NMPolitics.net conducted by email — the latest in our Q&A series with people involved in New Mexico politics and government.
Keller, a former state senator from Albuquerque who has been New Mexico’s auditor since 2015, shared other ideas to better equip his office to carry out its mission, including making obstructing a government audit a crime. And he discussed some changes he’s already made, including creating a Government Accountability Office to “shine a light on how our government is working, or in some instances not working.”
Keller is often mentioned as a possible candidate for governor or another office in 2018 — when he’s wrapping up his first term as auditor — and we asked about that too.
“I have to eventually consider what is next, but I’ve always felt the best credential for any future position is doing well in your current job,” Keller said. “… Having been born and raised here, I hope to continue to help our state throughout my life and will consider how to best be of service.”
Here’s our full interview, with questions in bold and Keller’s answers immediately following:
What have you found to be most surprising about the job of state auditor since taking office in January 2015? What have you found to be most challenging?
Given the many needs in New Mexico, the biggest surprise was that the amount of unspent funds sitting in government is much larger than anyone would have guessed. We shined a light on the issue by producing the nationally recognized “Fund Balance Report,” a tally of unspent funds from the annual audits of state agencies. These are dollars that were already allocated by the Legislature in areas that mean a lot to our state – water projects, job creation, and school infrastructure. Due to red tape and differing priorities, the money isn’t moving out the door and much of it is sitting stagnant. Activating even a small fraction of these dollars could make a big difference in terms of our economy and meeting the needs of New Mexicans.
Past auditors have complained that the office’s budget is too small to hire the number of people needed to effectively root out waste, fraud and abuse in state and local government agencies. Does your office need additional funding? If so, how much and how would you use it?
In addition to fielding and investigating a high volume of cases from whistleblowers, we oversee financial reporting of about 1,000 government entities across the state – agencies, counties, cities, school districts, land grants, hospitals and more – with expenditures totaling billions of dollars. But we only have a funded staff of about 30 employees with a small budget, which was cut 4 percent for next year. Fully funding the State Auditor’s Office would be the single best way to protect taxpayer dollars in New Mexico. The office was created to provide independent oversight of how government is handling the public’s money. If our state wants to be serious about ensuring accountability and effectively fighting fraud, waste and abuse, we need to provide the resources to do so.
Another example of how our office can assist communities is the $160,000 in grants we provide each year to small entities, such as acequia associations and conservation districts, to help them get caught up with their audits. By helping with the costs of financial reporting, we are helping these rural communities safeguard their money while also removing obstacles that have historically prevented these communities from receiving infrastructure funding.
Government corruption has been a significant problem in New Mexico in recent times. How are you approaching investigations into allegations of problems, including possible corruption, in government – especially if they involve members of your own political party? Can you give some examples?
We have a Special Investigation Division dedicated to rooting out fraud, waste and abuse in government. Most fraud is uncovered as a result of whistleblowers so we have a confidential hotline at 1-866-OSA-FRAUD. Our investigators, who are non-political professional staff (i.e. they are subject to the State Personnel Act and cannot be let go without legal cause), conduct fact-finding procedures for each case, regardless of party affiliation or level of government. We have investigated serious allegations that span every corner of our state and government officials from both parties. These range from a former Albuquerque police chief “greasing contracts” for TASER, an Española principal stealing from a candy fundraiser, a Cibola County Commissioner who spent taxpayer dollars on an AR-15 rifle and baseball tickets, and a Cabinet secretary’s abuse of power in dealings with a former client. While our investigations can sometimes lead to criminal referrals, these types of cases also serve as a public deterrent.
We’ve also conducted dozens of special audits involving issues that may not be criminal in nature but demonstrate shortcomings in how public funds are being handled. For example, we’ve released reports on the City of Santa Fe’s misuse of millions of dollars in park bonds, Doña Ana County’s Sheriff Department’s practices in managing federal Stonegarden grants, McKinley County Sheriff’s Offices use of DUI funds, the Public Education Department’s funding of special education programs, and more. The special audits can result in improved practices that better protect taxpayer dollars.
In your experience as a state senator and now auditor, are state and local governments becoming more transparent and accessible? What can your office do to help that happen?
Thanks to open government advocacy and other efforts, we have seen some improvements but there is clearly more work to be done. When I became State Auditor, we created the Government Accountability Office specifically to shine a light on how our government is working, or in some instances not working. The word “audit” does not sound exciting but think of the information they contain about your school district, your city, or your water system. Our reports, like “The Findings Report,” compile audit data and find patterns that would otherwise not be readily accessible to the public. When we noticed the troubling statewide trend of school personnel not undergoing background checks or licensing requirements, we issued a Risk Advisory to alert school officials and the public and called on the oversight agency, the Public Education Department, to address the issue immediately.
You’ve highlighted unspent capital outlay dollars allocated for infrastructure projects and issued recommendations for best practices when lawmakers are allocating such money. What type of reform would you like to see to the state’s capital outlay system and why?
Every capital outlay dollar tied up in red tape is a dollar that is not circulating in New Mexico’s economy. Our “Fund Balance Report” found that our state’s capital project funds are the most vulnerable to unnecessary accumulation. The report identified $1.2 billion in unspent capital project funds throughout state agencies in the last fiscal year alone. Our economy would benefit exponentially from reforms that address both the front end — how funds are appropriated — and the back end — how funds are actually spent. This means fully funding projects up front, using statewide project prioritizing, having a centralized reporting and tracking system, and including a firm “use it or lose it” date in all related appropriations.
You recently traveled the state to conduct audit trainings in several cities. Tell us about what you were doing and why it’s important.
We conduct training sessions all over the state about best practices in how to protect taxpayer dollars in our communities. Hundreds of government employees and independent public accountants attend from Raton to Las Cruces and from Gallup to Clovis. Rural New Mexico governments are often faced with limited training opportunities and struggle with a lack of access to capable financial employees as long time staff retires. Thus, each year the training we do tends be more and more important and we’ve seen a proportionate increase in attendance.
Two areas we emphasized this year was how to use our new online contracting system and a new accounting standard that is going to be a game-changer for transparency, called GASB 77. Moving forward, audits will include more detailed information about certain tax breaks. Policymakers have long fought to access this data because it can reveal whether the state’s many tax carve-outs are truly supporting economic growth. Collecting this information in audits is the first step on a path towards creating an informed and effective tax system.
Are there any changes you’d like to see to state laws regarding government audits? If so, what changes are needed and why?
We develop an agenda each year to improve government accountability in our state. For years our office has supported making “obstruction of an audit” a criminal penalty in our state. The lack of “teeth” regarding our office’s ability to enforce some of our investigative work stems from not having this provision in the law. In addition, we continue to support broader efforts for transparency and accountability, many of which I also championed as a State Senator, including the Ethics Commission, tax expenditure budget, tax reform, capital outlay reform, Sunshine Portal enhancements, procurement reform and reversion of unspent funds.
One of the truly impactful changes we are working on, in collaboration with the survivor advocacy community, is our state’s backlog of Sexual Assault Evidence Kits, commonly referred to as “rape kits.” Our office helped complete the first ever statewide count of kits that remain untested at law enforcement storage facilities. Having an accurate count of the number of untested rape kits was the first step at reducing the backlog and arming policymakers with information needed to bring justice and closure to cases. The number of untested kits in our state is 5,410 and each of those represents a survivor. We are in the process of conducting a statewide, multi-agency audit to get at the bottom of why the backlog occurred, how the state can clear it, and how to prevent it from happening again. This will likely require changes in the policies and procedures of law enforcement agencies and crime lab facilities.
How does New Mexico’s Office of the State Auditor compare to auditor’s offices in other states in terms of funding, structure, and governing laws? What can New Mexico learn from other states to improve the effectiveness of the auditor’s office here?
New Mexico benefits from having an independently elected State Auditor who is directly accountable to the public rather than to an individual or committee for appointment. About 17 states have auditors who are elected by the public while others select their auditors legislatively or by appointment. Our office works cooperatively with other states, especially in sharing lessons from groundbreaking efforts, such as the Kentucky Auditor’s Office that conducted the first Sexual Assault Evidence Kit audit.
The first 50 years of the State Auditor’s history is replete with efforts by the other branches of government to eliminate the independence of the office. This was finally put to rest with a Supreme Court Ruling that stated the broad and independent powers of the office: “Historically and fundamentally, the Office of State Auditor was created and exists for the basic purpose of having a completely independent representative of the people, accountable to no one else, with the power, duty and authority to examine and pass upon the activities of state officers and agencies who, by law, receive and expend public moneys.” Thompson v. Legislative Audit Commission (1968). However, our office’s scope is limited by the constitution to the finances of New Mexico governments. This means that non-profit organizations, businesses and private individuals are outside the jurisdiction of the office.
You’re often mentioned as a potential Democratic candidate for governor in 2018. That would be at the end of your first term as state auditor. Are you considering running for governor?
I’m honored to serve as State Auditor and am focused on doing the job effectively. Naturally given my age and term limits, I have to eventually consider what is next, but I’ve always felt the best credential for any future position is doing well in your current job. I left the private sector to pursue my passion for public service and I reflect on where I can have the most impact in advancing innovative ideas for New Mexico. Having been born and raised here, I hope to continue to help our state throughout my life and will consider how to best be of service.
Are you considering running for any other offices, such as U.S. Senate or House?
Same as above.