Santa Fe city administrators said Tuesday they will comply with an accounting firm’s recommendations to improve planning and tighten financial controls after a stinging report that listed numerous failings in management of a $30.3 million bond issue that was supposed to improve parks and trails.
“This audit paints a clear picture of a system that needs to be fixed immediately to meet our high standards of transparency and accountability,” Mayor Javier Gonzales said in a statement. “We will take immediate and decisive action to fix the problems it has uncovered.”
REDW LLC, an accounting firm based in Albuquerque, found myriad flaws in the city of Santa Fe’s administration of the 2008 bond issue.
REDW reviewed the files for 25 of the 52 projects that were included in the bond issue. It found that 21 of the 25 exceeded the established budget. Those projects were overspent by a total of $917,811, REDW said.
Other systemic breakdowns also occurred.
“The implementation plan for bond-funded projects was never finalized, and no formal revisions were made to the scope of work for any project,” the company stated in its report.
In 14 of the 25 projects that the company reviewed, the scope of work was never approved by the City Council or the city manager.
Oscar Rodriguez, who became city finance director last November, said those shortcomings had been corrected for a 2012 public works bond issue. He also said that the city government would adopt a system in which every bond project is reviewed to determine if all prescribed work was completed.
Rodriguez said breakdowns in the 2008 parks and trails bond issue occurred because of unusual circumstances and pressures.
Most of the work was done by city employees who were supervised by other city workers. Typically, the city would have hired private contractors to build trails or expand parks, and its managers would have monitored progress to make sure construction had been done properly.
But the 2008 bond issue coincided with the national recession, so the city moved parks employees and public works crews onto construction details. This enabled the city to avoid laying off hundreds of its workers by assigning them to projects funded by the bond issue, Rodriguez said.
“They weren’t doing as much maintenance in parks because they had new responsibilities,” he said in an interview. “That was part of the strategy to survive” the economic crash.
Rodriguez said the city was able to keep workers on the payroll instead of furloughing them. But shifting employees into unfamiliar roles had a downside.
“The problem is we’re not having a perfect accounting of each of the projects,” he said.
Rodriguez also said projects were altered on short notice if a supervisor decided that one section of a trail or park appeared to need more attention than another that had been targeted for improvements.
REDW found that the city’s records on the 2008 bond projects are incomplete. Basic information is missing, meaning questions about efficiency or how workers were deployed cannot be answered.
“Implementation plans … should have enough detail for individuals not familiar with the project to verify that the work was completed,” the company said in its recommendations.
Rodriguez said he was incorrect when he said Monday that REDW would receive $30,000 for its review of the bond issue. The city actually will pay the company $49,500, he said.
