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Thank you.

This is Fronteras: A Changing America.

I'm KC Counts.

Thank you for joining us.

New Mexico State Auditor Joseph Maestas recently released a scathing audit of Doña Ana County leadership and management.

The report criticized financial management, human resources, leadership conflicts, and public safety operations.

A fiscal agent appointed by the state will oversee spending of state money, and County Manager Scott Andrews was fired after commissioners held a special meeting, behind closed doors and voted unanimously for that action.

State Auditor Maestas joins us to talk about that process, public accountability, oversight and transparency, as well as recent legislation that aims to strengthen it all in local and state government.

Thank you for joining us.

Thank you for having me KC.

That was a lot, in that intro to unpack.

And I certainly want to start by just giving folks an idea of the role of the state auditor's office.

Sure, yeah, my office, it's a constitutional office.

It's one of seven, agencies in the executive branch in the state of New Mexico.

We have independent authority to oversee the finances of all public entities, across the state.

And so it's a very important job.

We are the state's financial watchdog.

Sorta speak.

How big is your office?

Well fully staffed have about 44 full time employees, but right now we're at about 33, 34.

So we're us, we're, I like to say we're, we're small but mighty, and, we do important work, we really do.

We also, help the district courts, review financial reports from conservators, to protect vulnerable adults, the district courts appoint conservators, oversee the financial assets of these vulnerable adults.

And so we assist the courts to ensure that the finances are being managed in a transparent way.

That in itself is a very complicated issue, and I want to get to that later in our conversation.

So I hope I save enough time for it.

But I want to talk a little bit next about the State Audit Act and audit rule and what those mean and how they play into your job.

Sure, really, the Audit Act grants me that authority to audit every single public, entity, in part or whole, in part means that we can do limited scope audits, depending on certain issues.

We handle anonymous intake of fraud, waste, and abuse complaints, and sometimes that could represent the birth of a limited scope special audit.

But we routinely do annual financial compliance audits of financial statements of every single public entity, in the state.

And these full audits are required for about, almost 700 public entities.

And then we also ensure the financial compliance of small local public bodies.

These are acequias, mutual domestic water associations, whose revenues are under a half a million.

I imagine you're going to be diving into the water issues.

Yes.

With the recent settlement, approved by the U.S.

Supreme Court for Texas v New Mexico and Colorado and that itself will be a big issue as well.

Yes.

Let's talk a little bit about the audit process, And really when it comes into a special audit like that of Doña Ana County.

What does that process entail?

Well, let me just finish the the Audit Act is the statute.

But as you know, statutes don't really lend themselves to detailed procedures.

So that's why we have an audit rule.

And every year we, we, basically evaluate the audit rule, assess changes to accounting standards.

And so the audit rule is the detailed procedures to ensure that we're in compliance with the Audit Act.

Thank you for remembering the second part of that question.

Sure, sure.

But the, the annual, audit process, basically, we manage independent public accounting firms from across the state.

There's about 50 right now that are certified by our office, and we must vet them every year before they can contract with public entities all across the state to do their annual financial compliance audit.

And again, the focus is on financial statements.

If the entity receives more than $1 million in federal funds, there's a second component to the audit, and that's called the federal single audit.

So there's two elements the financial statement audit and the federal single audit, for an entity that has federal revenues in excess of $1 million.

Can you give us an idea of what those entities are?

Well, you know, it's your your big complex, agencies.

But on the other end of the spectrum are the small local public bodies, their revenues are under a half a million, its, its doubtful that they would ever receive more than $1million in federal funds.

And so they're subject to a lesser degree of financial compliance, as opposed to an entity that has, you know, more than a half $1 million in revenue and more than $1 million in federal funds.

At any given time, how many audits are going on?

Well, at the height, I'd say at least 650 to 675.

The, due dates for these audit reports depends on the category of the entity, and they're staggered, and they start in September, and they're staggered so we can, better manage the workload.

And, so those dates go all the way from early September until the end of the calendar year.

And then my office receives these audit reports, and we do our own review, and we basically authorize the audit report to be released to the public when it's ready.

So back to that audit process.

Yes.

You get the call for a special audit out of Doña Ana County.

How did you become aware of problems?

Sure.

And take us through that process.

In the case of Doña Ana County, we received official requests from the Doña Ana County administration, and the sheriff's office, and their issues were different.

And so what we often do with the office of the state auditor is we kind of intervene to mediate these conflicts.

And so in the case of Doña Ana County, we took all those issues and combined it into the scope of the special audit.

And so and we made sure that all parties, all sides, were acceptable to the scope of the special audit.

And the special audit occurred.

You know, there was 42 findings, and it revealed a lot of, dysfunction within the departments, in Doña Ana County, among many other findings.

And, you know, it's it's understandable.

The administration is really ultimately accountable for adressing all those findings, the 42 findings and the county, basically accepted the audit in the form of putting forth, corrective actions with timelines and responsible individuals for each of the 42 findings.

So what we're going to do is monitor those commitments that they made in the special audit to address, those findings through their corrective actions.

This was a 355 page report.

Yeah.

Is that typical?

No, its not.

And for a county of this size, our staff, we were quite taken aback at the level of dysfunction.

And and really, the dysfunction had had been longstanding through multiple administrations.

And so, it just seems, as a, as an elected official that that, there are there's some culture, cultural changes that need to occur, and it needs to start well, right now.

And I think the commissioners realized that they need to have the right leader, in the administration to oversee the, corrective actions in this, astounding special audit report.

What was involved in the audit?

How did, how many people took part and what types of, what types of methods did they use to reveal these issues?

Well, you know, they do testing of transactions.

I mean, obviously the, the auditor that was procured by the county, had the scope and they have to work within the scope of the special audit.

But, they looked at a number of areas, and it included interviews with county officials.

And here's the thing that is, a staple in these special audit reports is, the auditor also conduct employee surveys to see if, if, their findings, are consistent with the feedback from the employees and, and that was the case, in this audit.

And so you have, I would say, more validation in the findings through the findings of the employee survey, which was extremely insightful and, and revealed, what the audit found, which is a lot of a lot of dysfunction, a lot of, you know, harassment and intimidation, and, you know, you don't want that in the workplace.

If you want a high performing workplace, you want employees, to trust the system.

And I would say employee trust and public trust has been severely eroded in the case of Doña Ana County.

How long did it take the process to conduct that audit?

Well, you know, the nature of audits is there's a lag, right?

Because you're you look back.

And so what I've been doing is state auditor is trying to accelerate these findings because if there is potential fraud, waste and abuse, you want to minimize that interim time where it could persist.

And so we've been putting timelines on these special audits.

I believe we had 120 days for this particular audit.

We may have granted a time extension because sometimes the auditor will discover additional issues, and they need more time.

So we wanted to make sure that it didn't go on for like a whole year, sometimes these can last a year, but I would say it was less than a year given the time extension.

And given what you've said about the findings.

Yeah.

Fraud.

You know, should we, expect that there are reasons for criminal charges here?

Well, we didn't identify any any potential criminal wrongdoing.

And I want your viewers to know that, you know, we're not prosecutors, we're not investigators.

Our duty is to inform and notify.

And at the conclusion of an audit, what we do is we make referrals.

For example, if there's a governmental conduct violation by a certain official, we'll make a referral to the state ethics commission.

If we determine that additional investigative investigation is required, we may make a referral to the local police department.

If it's prosecution, it could go to the attorney general or the local DA, typically, it's to the local DA.

So, and you've already seen what has occurred since the audit.

We also made a referral, in the case of Doña Ana County to the Department of Finance and Administration.

And in their view, and I'm not going to speak for them, but I'm sure the totality of the audit really forced them to take this action to require a fiscal agent to manage some of these projects, these capital outlay projects that, Doña Ana County has, which is, which is extreme.

That's an extreme measure.

Yeah.

Talk about what the role of the fiscal agent is, how, how much oversight is involved.

Well, they you know, they typically, administer the project, they have to have that capacity.

They are allowed to charge an administrative fee, to, to really oversee the implementation of these, these capital outlay projects.

It could be a council of government or you know, another regional public entity, but DFA has that authority to evaluate that entity as a potential fiscal agent before they make the designation.

Now, the third judicial district attorney, Judge Fernando Macias.

Yeah.

Was the Doña Ana County, manager, previous to Scott Andrews, who was just terminated.

How does that complicate things moving forward, or does it?

Well, it, it's, you know, we, we made sure to go to go back into a previous administration because, it could be too myopic to pick like the last year or two.

And so we always like to have a good history, in terms of management and, you know, I'm not going to be I'm not going to sit here and judge, but but I think, administrations that were in place during the time period of the audit, I think should bear responsibility for the current state of Doña Ana County.

Very interesting.

Now, it's not the only recent audit that you've conducted.

Our friends in Deming, also recently went through the same thing.

Tell us about your findings there.

Well, we, there was a whistleblower that was alleging, irregularities in the utility systems, and so we designated them for a special audit, very limited in scope, to the utility enterprises.

But it did delay their annual financial audits.

And so they're trying to catch up.

They just submitted their fiscal year 22 audit to us.

But here's the problem.

If you're not financially compliant, you can't access your awarded capital outlay.

In the case of Deming, they had $20 million that was pending.

And they were very concerned, including their local state legislative delegation, to avoid these capital outlay projects from reverting to the general fund.

So at the 11th hour, they were, able to designate a fiscal agent to manage those capital outlay projects, while the Deming becomes current on their audits.

How would you say that audit compared to the Doña Ana County audit?

The special audit actually was a it was a big nothing burger.

I mean, there really was you know, sometimes that happens, and it's, it's our, our responsibility to delve into it.

If we feel that we should, intervene in the form of a special audit.

Okay.

Well, let's move on.

We've got some pretty big topic areas to cover, and not a whole lot of time to do it.

So I want to talk a little bit about some other areas that you're concerned about moving forward.

You mentioned conservatorships.

Opioid settlement funds is another.

And let's talk about AI because I think that the, appearance of data centers in just about every corner, of our world is something that's just top of mind for people right now.

And, and what role would your office play in making sure that things are operating for the betterment of our communities?

Well, the mere mention of AI has different connotations to different people, but I believe that it can be used, in a positive way.

For example, my office were, in the middle of developing a custom AI, program to streamline and make more efficient our audit review process.

And it's going to save us many, many, many hours in that regard, so we, we feel the we should embrace technology to be more efficient, cause I think that that, when we approach appropriators for additional budget, it's always good to say that we're taking steps to be more efficient with existing resources.

In the case of conservatorships, this was a mandate that goes all the way back, I believe, to 2021 state law was passed that mandated us to do that.

And it, it took, resources away from our core mission, which was financial audits.

And so we've been continuing, to meet that, that, legislative mandate.

In your opinion, what does the state need to do regarding conservatorships to, to make them easier for people?

Well, the problem is it's, it's getting information from private institutions that are a part of these conservatorships.

Number one, they're very reluctant to give, information that we request.

My office does have subpoena authority, and we've exercised that subpoena authority in auditing conservatorships.

But we review these financial reports, we do a risk screening, and if we designated them as high risk, then we have the opportunity to audit them.

And we audit, I'd say, 3 to 5 a year, which is not enough.

We need more resources to audit more conservatorships, because there's a lot of mismanagement that's going on by conservators.

And how about opioids, settlement money?

Yes.

Yes.

I know communities all over the state their own conversation about what to do with their piece of the pie.

Having been, you know, raised in northern New Mexico, I am the former mayor of Espanola.

I saw firsthand the impacts of opioid addiction on communities and families and people that I know.

And so, we have the authority, the office of the State Auditor has the authority to test, transactions of opioid settlement funds.

And if they're not consistent with the opioid settlement agreement, we can prevent further allocations to that entity, until they return that money.

So we do have an active role.

The allocations have been going on for three years, and so we haven't we've been standing back.

We issued an advisory to all the recipients saying, look, this funding is coming, be prepared, plan, establish policies and procedures, and engage your communities to determine, which activities you want to fund with these settlement, moneys consistent with the agreement.

Well, we decided to do this comprehensive evaluation after three years of funding allocations.

And to our surprise, we identified about 110 million of unspent opioid settlement funding.

And there's simply no excuse for that.

What we did do is we also surveyed cities and counties, and that's the scope of this study, is cities and counties.

The predominant issue for cities is that they're reluctant to start a recurring program and continue funding it after the settlement funds cease.

The counties, on the other hand, are not worried about that.

They're worried about the the behavioral health and the provider infrastructure.

And there's a lack of it in county governments.

And that's their main reason for being reluctant to go ahead and spending their money, but, Its eye opening.

Yeah.

It's a wake up call for the state of New Mexico and especially for these entities that have not spent their allocations.

Yeah.

Well, you just mentioned needing more resources, but also using AI to maybe fill some of those resources.

If I'm not mistaken, I saw accountants, as well as journalists on the list of jobs that were under threat, from AI, and I can kind of see it in the account fields more so than in the journalist field, because obviously journalists are putting that information out there for AI to go and find, right?

Sure.

So how do you think that will impact your office?

I don't think it will because, you know, the, the field of accounting relies heavily on judgment.

For example, these independent public accounting firms that we vet, and allow to contract with public entities, I authorize them to do that.

And so, I want to make sure that, that they do carry that authority and represent my office, properly.

But we defer to their judgment, heavily.

And so I, I don't think AI will ever, ever replace, the judgment of accountants and CPAs, but it could have a chilling effect on the interest on the part of undergraduate students in the field of accounting.

Well, that's where I wanted to go next, is kind of that future.

And, and those students that are seeking those careers now or, and should they be reluctant to do so in the future?

Yeah, we have a national workforce crisis.

There is, let's say 70, almost 75% of CPAs are eligible to retire.

We've seen a lack of interest in undergraduate students pursuing accounting.

There's a big problem in this one national standard that requires 150 hours of on transcript credits to sit for the CPA.

But, we just help pass a law here in New Mexico, It's called House Bill 296, which basically allows more time to take the CPA exam and will allow you to sit for the exam with only a bachelor's, only 120 hours of on transcript, and the additional 30 you can get through experiential, or through experience.

So it's basically, on transcript credit hours, experience in lieu of the credit hours.

And so that's what's needed.

But the, the main problem is reciprocity, right.

The American Institute of CPAs needs to ensure that that CPA licenses are portable from state to state.

We hear that for many different professions.

We've been talking a lot about it regarding health care.

So tell us about the landscape for financial professionals.

Well, what we're trying to do is to integrate accounting into the STEM umbrella science, technology, engineering and math.

Id say it fits under the math category.

Yeah, there's federal legislation pending both in the House and Senate side, but it may not go anywhere because it has some DEI in there.

And we know how this administration feels about DEI.

But we are convinced that if we incorporate accounting into STEM, that would stimulate interest on the part of undergraduate students and accelerate the integration of technologies not just of AI, but blockchain learning, data analytics, and it's fascinating stuff, and I think that that would really be intriguing to undergraduate students that are on the fence regarding a pursuit in the field of accounting.

Well, I know folks can find all this information.

And if somebody has, that last bit of summer reading that they want to do and they want to tackle that 355 page Doña Ana County special audit, tell folks where to go.

Yeah, it's on our website.

Any, any public audit, report that is issued, it's available on our website.

All right.

State auditor Joseph Maestas thank you so much for being with us.

Thank you so much.

Appreciate it.

And recently, area high school students, possible future auditors, from Las Cruces, were honored during the 2025, 2026 school year as the Mayor's Top Teens.

KRWG Membership Coordinator, Liz Liano talked with each of them, including Organ Mountain's, Addison Wells.

Welcome to Mayor's Top Teens, I'm Liz Liano.

And today, we're going to be talking to Addison Wells.

Welcome Addison, and congratulations on being a Mayor's Top Teen.

Thank you.

So, we'd like to hear about what you do.

What are some of your activities?

What have you been up to?

So I'm super involved in my school student council.

I'm the student body president.

And I have taken lots of AP courses, and I'm really, really interested in studying kinesiology.

So I've taken a lot of psychology courses, which has been really fun.

I'm also involved in the Special Olympics and Best Buddies programs, and also the National Honor Society.

Very cool, that's a, that's a nice little list.

What does the, you said the Special Olympics Best Buddy program.

What does that entail?

So we like to include kids with special needs and activities like cornhole, basketball, kickball, and we host games at the different high schools.

And we also do luncheons every other week, which is really fun.

And we do little activities with them.

So that's been a really awesome experience too.

Oh, that sounds really sweet.

You do the best buddies.

And you also said you want to study kinesiology.

Yes.

And you've been taking psychology courses for that?

Yes.

I took a psychology course last semester.

Very nice.

So what made you want to, study kinesiology?

I originally wanted to be a physical therapist, but I did have a family member that was ill, and I got to watch the occupational therapist work with him, and it was really awesome experience just seeing her work.

And it made me very interested in the field.

So I thought kinesiology would be the best route.

Interesting, and what does an occupational therapist do?

From my perspective, it really helps their patient with day to day life activities such as tying your shoe, you know, getting out of bed, things like that after being sick, even having surgery.

So it's just a little bit more day to day then, physical therapist.

Very cool, very cool.

And so you study hard, you're working on kinesiology, your in the best buddy program.

What other, activities or community service things have you been doing?

I'm also a part of the LCPS Student Advisory Council, and it's a club of students from all schools, and we basically get to meet and collaborate for the district and get to present new ideas and opinions to the LCPS school board.

So that's also been a very cool experience for me.

And I've made a lot of different friends.

Got to go on trips to Santa Fe.

So that's also been really fun.

And I also play basketball, so that definitely keeps me busy.

And I'm super excited to start the club season coming up.

Wonderful, wonderful, sounds like you're really, putting yourself out there, making your voice heard, exercising a lot of your skills.

So where do you want to end up going to school?

I am planning on attending Texas Tech University on an academic scholarship next year.

Okay, cool to study kinesiology?

Yes.

Wonderful, so, you want to leave Las Cruces?

Definitely.

It's definitely been a goal of mine for a really long time to leave home.

Both of my parents did it, and so it was definitely something I wanted to carry on and have that experience for myself.

Wonderful, well, thank you so much for being here today, Addison, and I want to congratulate you again for being a Mayors Top Teen.

Thank you so much, I appreciate it.

Our thanks to Liz Liano and Addison Wells and to New Mexico State Auditor Joseph Maestas for joining us.

And thank you for joining us and for supporting local programing like this.

You can watch episodes of all our local programs at KRWG.org, where you can also sign up to receive the Friday News Wrap, our award winning weekly newsletter that helps you catch up on our local coverage for the week, from KRWG public media.