State Auditor, treasurer issue joint alert about collateralization of public funds

On Monday, the State Auditor’s Office and State Treasurer’s Office issued a joint alert to all New Mexico counties and municipalities. The required annual audits submitted by counties and municipalities across the state showed that local governments are not appropriately following collateralization laws and Federal Deposit Insurance Corporation guidance, a press release said. “In recent […]

State Auditor, treasurer issue joint alert about collateralization of public funds

On Monday, the State Auditor’s Office and State Treasurer’s Office issued a joint alert to all New Mexico counties and municipalities.

The required annual audits submitted by counties and municipalities across the state showed that local governments are not appropriately following collateralization laws and Federal Deposit Insurance Corporation guidance, a press release said.

“In recent months, some local governments bypassed the collateral requirements by adding multiple employees or elected officials to bank accounts to secure $250,000 of FDIC insurance for each account signer,” the release said. “New Mexico state law requires banks to have proper collateralization to safeguard taxpayers’ money. Any amount of public money held in banks over the $250,000 insured by the FDIC must be backed by other forms of sureties.”

Collateral is used to protect public funds in the event of a bank collapse. 

The State Auditor’s Office did not comment on the exact number of local governments that may have fallen out of compliance with collateralization laws. The agency is still reviewing the annual audits and has yet to receive some audits. The annual audits are due in December and the office generally begins to post them in January.

“This is why audits are important,” said State Auditor Joseph Maestas. “Without an independent audit, these safeguards would have been bypassed and our public funds could have been in jeopardy.”

The FDIC issues may have come because of recent bank failures and possible concerns from the counties and the New Mexico Municipal League over the safety of public monies, a letter sent by State Treasurer Laura Montoya and Maestas stated.

“This issue is especially consequential with respect to FDIC insurance, because all bank accounts with balances above the FDIC insurance limit of $250,000 must be collateralized consistent with state law,” the alert said. “In recent months, it appears that some agencies bypassed these collateral requirements by adding multiple employees or elected officials to bank accounts to secure $250,000 of FDIC insurance for each account signer.”

Montoya issued a statement that since the practice is not consistent with state and federal law, that her office “will continue to work with government agencies and banks to ensure that New Mexico funds are not at financial risk.”

The annual audits are completed by independent auditors across the state and determine if the entities such as counties, municipalities, school districts and soil and water conservation districts are in compliance with state and federal law as pertains to their financial statements.

“We trust that this Alert will direct attention to the importance of the underlying issue of safeguarding public funds,” the alert stated. “Additionally, we anticipate

clarification of these issues can further assist agencies and banks in reviewing and revising their

policies and internal procedures to ensure compliance with their fiduciary duties.”

We're ad free

That means that we rely on support from readers like you. Help us keep reporting on the most important New Mexico Stories by donating today.

Related

Effort to challenge six laws enacted last year comes to an end

Effort to challenge six laws enacted last year comes to an end

Earlier this month, the New Mexico Supreme Court denied and dismissed the effort to challenge six laws enacted in 2023. The New Mexico Supreme…
Governor to call special session for public safety legislation this summer

Governor to call special session for public safety legislation this summer

Gov. Michelle Lujan Grisham announced that she will call the Legislature into a special session this summer to address public safety legislation that did…
Emily’s List endorses seven candidates for Legislature

Emily’s List endorses seven candidates for Legislature

Emily’s List, a nonprofit that supports women candidates and reproductive rights, endorsed seven incumbents facing general election opponents in New Mexico legislative elections. All…
Two PFAS chemicals designated hazardous substances under Superfund law

Two PFAS chemicals designated hazardous substances under Superfund law

The U.S. Environmental Protection Agency released a final rule Friday to designate two types of PFAS chemicals as hazardous substances. Those two chemicals are perfluorooctanoic…
BLM finalizes controversial public lands rule

BLM finalizes controversial public lands rule

The U.S. Bureau of Land Management finalized its controversial public lands rule on Thursday. This rule is controversial because it allows for conservation leasing…
Haaland signs order protecting sacred lands near Placitas

Haaland signs order protecting sacred lands near Placitas

Interior Secretary Deb Haaland signed an order on Thursday to withdraw more than 4,200 acres of land in Sandoval County near Placitas from mineral…
Amid new graduation requirements, what do high schoolers want to learn?

Amid new graduation requirements, what do high schoolers want to learn?

By Margaret O’Hara, The Santa Fe New Mexican The main things that bring Brayan Chavez to school every day: Seeing, talking to and engaging with…
Special ed teachers hope lawmakers OK pay raises, admin changes

Special ed teachers hope lawmakers OK pay raises, admin changes

By Margaret O’Hara, The Santa Fe New Mexican Brittany Behenna Griffith has a laundry list of adjectives to describe the ideal special education teacher:…
Lawmakers must find consensus on competing education spending plans

Lawmakers must find consensus on competing education spending plans

By Margaret O’Hara, The Santa Fe New Mexican A challenging task awaits New Mexico lawmakers in the next 30 days: Reconciling three very different…
Health workers fear it’s profits before protection as CDC revisits airborne transmission

Health workers fear it’s profits before protection as CDC revisits airborne transmission

Amy Maxmen, KFF Health News Four years after hospitals in New York City overflowed with covid-19 patients, emergency physician Sonya Stokes remains shaken by…
Lujan Grisham, Biden admin announce $10 million in federal funds for tribes, pueblos

Lujan Grisham, Biden admin announce $10 million in federal funds for tribes, pueblos

Gov. Michelle Lujan Grisham announced Friday $10 million in funding from the federal American Rescue Plan Act was awarded to six tribal nations and…
Proposal to curb executive powers moves to House Judiciary

Proposal to curb executive powers moves to House Judiciary

The House Government, Elections and Indian Affairs Committee discussed a potential constitutional amendment that seeks to limit the governor’s executive powers. The committee approved…
Abortion fund provider rebrands and holds open house

Abortion fund provider rebrands and holds open house

An abortion fund provider unveiled a rebrand and offered an open house in Las Cruces to celebrate the organization’s new name, mission and values. …
Stansbury introduces judicial ethics bill on U.S. Supreme Court steps

Stansbury introduces judicial ethics bill on U.S. Supreme Court steps

U.S. Rep. Melanie Stansbury announced a bill on Thursday that would, if enacted, establish judicial ethics to the U.S. Supreme Court. The Judicial Ethics…
Politics and abortion, how much will it matter?

Politics and abortion, how much will it matter?

At the national level, abortion is still a high-stakes issue with both major presidential candidates talking about it in their campaigns, but it may…
Abortion fund provider rebrands and holds open house

Abortion fund provider rebrands and holds open house

An abortion fund provider unveiled a rebrand and offered an open house in Las Cruces to celebrate the organization’s new name, mission and values. …
Politics and abortion, how much will it matter?

Politics and abortion, how much will it matter?

At the national level, abortion is still a high-stakes issue with both major presidential candidates talking about it in their campaigns, but it may…
How the AZ Supreme Court decision on abortion impacts New Mexico

How the AZ Supreme Court decision on abortion impacts New Mexico

The Arizona Supreme Court ruled on Tuesday that an 1864 abortion ban is enforceable, throwing another state bordering New Mexico into the situation of…
Effort to challenge six laws enacted last year comes to an end

Effort to challenge six laws enacted last year comes to an end

Earlier this month, the New Mexico Supreme Court denied and dismissed the effort to challenge six laws enacted in 2023. The New Mexico Supreme…
Vasquez calls out Republicans for ‘inaction’ on border policy

Vasquez calls out Republicans for ‘inaction’ on border policy

U.S. Rep. Gabriel “Gabe” Vasquez, a Democrat who represents the state’s 2nd Congressional District along the U.S.-Mexico border, cosponsored a resolution on Monday calling…
Politics and abortion, how much will it matter?

Politics and abortion, how much will it matter?

At the national level, abortion is still a high-stakes issue with both major presidential candidates talking about it in their campaigns, but it may…
Two PFAS chemicals designated hazardous substances under Superfund law

Two PFAS chemicals designated hazardous substances under Superfund law

The U.S. Environmental Protection Agency released a final rule Friday to designate two types of PFAS chemicals as hazardous substances. Those two chemicals are perfluorooctanoic…
New Mexico Voices for Children has new leadership

New Mexico Voices for Children has new leadership

New Mexico Voices for Children, an organization that focuses on tax policy and how it impacts children in poverty, has new leadership. Gabrielle Uballez…
Abortion fund provider rebrands and holds open house

Abortion fund provider rebrands and holds open house

An abortion fund provider unveiled a rebrand and offered an open house in Las Cruces to celebrate the organization’s new name, mission and values. …

GET INVOLVED

© 2023 New Mexico Political Report