News

2018-08-23
Wayne Johnson: $120,000 elder care funds used instead for parties and bonuses

Wayne Johnson: $120,000 elder care funds used instead for parties and bonuses while services were cut and seniors lingered on waiting lists

Santa Fe, NM – State Auditor Wayne Johnson says thousands of dollars? entrusted to a local public organization meant to feed and care for New Mexico’s elderly were instead used for parties, laser tag, food, flowers, and employee bonuses.

Johnson today released the results of a special audit of an organization that received more than $20 million annually to provide meals, caregiving, transportation, and other services to seniors in nearly every New Mexico county. Johnson says the results are stunning and disappointing and show a reckless disregard for public funds at a time when nearly three-quarters of a million dollars were cut state-wide from senior services. 

“It’s reprehensible to pay out employee bonuses, play laser-tag, and enjoy gourmet meals and alcohol with taxpayer money intended to feed and help our low-income parents and grandparents,” says Johnson. “Even worse, this stunning waste of money happened while the same organization slashed senior services and allowed waiting lists for essential services like home-delivered meals to swell as resources became more limited.”

Johnson ordered the audit earlier this year after New Mexico Aging and Long-term Services Department (ALTSD) leaders asked him to investigate suspected “misuse, waste and abuse of public funds” on the part of the North Central New Mexico Economic Development District, a Santa Fe-based council of governments that runs the Non-Metro Agency on Aging (NMAAA). The group is responsible for administering services under the Older American's Act in 32 of New Mexico's 33 counties. They contract with 60 local service-providers who run more than 150 sites serving 72,875 older adults and caregivers.

NMAAA’s unnecessary delay in reimbursing community-based service providers originally led the ALTSD to further scrutinize the organization's operations and ask State Auditor Johnson to have a closer look at their finances. Johnson says the special audit confirms that NCNMEDD was responsible for delays and recommends tighter controls to ensure timely payment to providers.

The audit found dozens of expenditures that appear to be non-allowable under federal and state law, or are an indication of a lack of fiscal responsibility. These include:

  • Nearly $58,000 in employee bonuses for about 26 public employees;
  • Nearly $1,500 at Main Event, an Albuquerque entertainment venue with video games, laser-tag, a high-ropes balancing course, and a restaurant with a full-service bar;
  • $8,000 for a “staff retreat” at Albuquerque’s ritzy Andaluz Hotel, including banquet service and lodging;
  • More than $20,000 for economic development software and conferences seemingly unrelated to direct services for seniors;
  • Thousands of dollars for meals, some with alcohol, at restaurants like Tucano’s and Santa Fe’s Eloisa Restaurant;
  • More than $6,000 wasted on unnecessary fees, penalties credit card interest and late fees;
  • Various flower arrangements for funerals.

“The state financial environment and climate where this spending took place makes this all the more stunning,” says Johnson. “This organization was slashing senior services county-by-county and state leaders were considering furloughs for 24,000 state employees while this entity was playing laser tag and doling out an average of a $1,400 bonus per person to a select few. Frankly, it’s infuriating when you really consider the ramifications to our seniors.”

Even throughout the course of the special audit, NCNMEDD has yet to account for significant discrepancies of $336,000 in administrative costs and a $113,000 overpayment in the federal Title III Grandparents Raising Grandchildren program. Johnson has recommend that the state continue to investigate these significant discrepancies, and seek repayment of misspent federal and state funds.

This fact-sheet breaks out the full list of ‘non-compliant” items, as well as a county-by-county listing of budget cuts for senior services.

The entire special audit report can be found here: https://www.saonm.org/audit_reports/detail/11807