Audit rebukes Vigil-Giron

Secretary of State Mary Herrera said today that she might need to ask the state Legislature for money if a federal commission requires New Mexico to re-pay some federal election money.

Herrera was reacting to the release Wednesday of a final audit report of the Secretary of State’s Office.

"We do not know if we are going to owe anything back. We may not," Herrera said during a midday afternoon press conference.

The federal audit report found that New Mexico did not put an adequate match to qualify for millions of dollars in federal election funds and that it should recoup some of the money the Secretary of State’s Office paid to a contractor who did voter education work in 2004 and 2006.

The state should have put $751,000 to qualify for a substantial portion of the $19 million New Mexico received in federal election dolars. But auditors could not find evidence of the state’s match.

Herrera said the state transferred more than $500,000 of general fund money into an account to help the state meet its match. Her office is working with the State Treasurer’s Office to determine how to make up the difference, including using interest earned on state investments, she said.

The 36-page report, compiled by the Inspector General of the Federal Election Assisstance Commision, also found that the state Attorney General’s office did not review an Aug. 26, 2004 letter in which former Secretary of State Rebecca Vigil-Giron agreed to pay the contractor, Armando Gutierrez of Albuquerque-based A. Gutierrez & Associates, Inc. a 17 percent administrative fee. Ultimately, Gutierrez was paid more than $6 million for voter education work. Part of that payment included a $1 million administrative fee. 

The Aug. 26, 2004 letter changed how Gutierrez was paid from three hourly rates to a 17 percent administrative fee.

"The former Secretary of State told us that she relied on the statements made by the Contractor that it would be better to agree to the 17 percent fee arrangement because it would result in a lower overall cost to the state," the report says.

 The Attorney General’s office, which is legally bound to review state agency contracts, told auditors that the Office "had not reviewed the August 26 letter as a part of their review of the contract or the amendments."

The audit also questioned the size of the administrative fee, saying it was difficult to tell what base Vigil-Giron used to compute the fee.

"The amount paid for the voter education campaign exclusive of the management fee and taxes (i.e., for the production of scripts, tapes, compact discs and newspaper inserts and the purchase of air time) was $4,869,210. If one were to assume that Gutierrez actually incurred $4,869,210 in costs, it would have been reasonable then to calculate the administrative fee by multiplying $4,869,210 times 17 percent. The product of this calculation is $827,766; which is $201,774 less than the amount billed for administrative fees," the report said. "However, because the August 26, 2004 agreement does not identify the base(s) to which the rate should be applied, it is not clear how the fee should be determined."

The Aug. 26, 2004 letter changed payment provisions a day after Vigil-Giron had signed the original contract with Gutierrez.

A call to Gutierrez seeking response was not immediately returned. 

And Vigil-Giron said Wednesday morning that she had no response to the final audit.

"I answered all the issues that they brought forward," Vigil-Giron said, referring to a May 20 response she sent to EAC prior to Wednesday’s release of the report.

 
In her response to the EAC, Vigil-Giron questioned the release of the final audit, which was scheduled for late May, saying it came days before the June 3 Primary in which she is a candidate for the Democratic nomination in the 1st Congressional District race.

"The timing of the release of a Final Audit (without fact finding from the principal involved) is suspect and will be perceived in my State as highly prejudicial to me and displays a basic unfairness from your Office," she wrote.

Vigil-Giron went on in the May 20 letter to the EAC: " I assume, in the interest of accuracy, you should be concerned with information from the principals involved rather than from a biased non-involved principal, namely the current Secretary of State (Mary Herrera)."

Herrera said Wednesday she had no hidden agenda.

"I did not have any idea of what the outcome would be," said Herrera, who requested the audit in early 2007. "I had no idea she was going to run for any office." 

Vigil-Giron e-mailed her response to the EAC to the Independent via e-mail Wednesday morning.

In that correspondence Vigil-Giron also implied that the EAC audit might be partisan and suggested that the EAC targets mainly Democrats, although Herrera, a Democrat –requested the audit in early 2007.

The EAC’s Inspector General Curtis Crider told the Independent on Wednesday that his office is nonpartisan and that "I don’t know how many Democrats or Republicans we’ve audited. We don’t think like that," he said.

Typically, the Office of Inspector General determines which states to audit based on the amount of federal money they have spent. In other words, states spending the most federal election money get audited, Crider said.

In New Mexico’s case, however, the audit was prompted by Herrera’s request in early 2007, Crider said.