Nine years after the state approved a new rural public transportation district, nearly two-dozen free bus routes crisscross Santa Fe, Taos, Rio Arriba and Los Alamos counties. Last year, the district provided roughly 374,000 rides.
But in its relatively short tenure, the North Central Regional Transit District has been plagued with poor audits and high administrative costs. Now, public records reveal that NCRTD may have violated its own rules in paying $712,322 to an out-of-state bus provider in 2009—and local companies excluded from the bid process are crying foul.
Documents obtained through public records requests show that NCRTD staff members made three purchases from Georgia-based National Bus Sales, ranging from approximately $100,000 to $370,000 each—amounts that would have required the NCRTD board’s approval.
“If any expenditure is over $100,000, it has to be taken to the board,” NCRTD Executive Director Anthony Mortillaro tells SFR. “There’s no question about that.”
Yet in responding to SFR’s records request, Mortillaro couldn’t find any mention of the purchases in board minutes from 2009. Mortillaro, a board member at the time, says he also can’t recall staff members presenting the purchases to the board. Neither can former Santa Fe City Councilor Rosemary Romero, Taos County Commissioner Daniel Barrone or Española City Councilor Robert Seeds, all of whom served on the board in 2009.
“That is a concern,” Barrone, the new board chairman, tells SFR. “They don’t have that authority without board action.”
One possible explanation, Mortillaro says, is that staff may have interpreted the board’s approval of the district’s overall budget as a go-ahead to make purchases without having to run each one by the board. But Mortillaro, who joined the NCRTD staff in 2011, says he wouldn’t have done such a thing because “the bylaws are clear.”
The NCRTD has exhibited notoriously sloppy accounting in recent years. Private audit firm Hinkle and Landers found the same 13 accounting problems in the district in 2008 and 2009, including internal control weaknesses and missing disbursement documentation.
Romero, who was appointed to the board in 2008 and became chairwoman in 2010, blames some of that on the new district’s growing pains.
“Staff was moving quickly to do things and may at some times not have followed policies,” she says.
One problem with the 2009 purchases, according to federal officials, is that they weren’t put up for competitive bidding.
NCRTD’s procurement laws allow the agency to bypass standard sealed bidding processes by joining other state and local agency cooperative purchasing programs, which allow the NCRTD to piggyback off of other state and regional contracts. The process is typically used by smaller agencies that might not have the staff or resources available to handle an open bidding process—but it can also exclude local vendors capable of doing the work.
“We’ve never been invited to bid on them,” Hi Tillery, a fleet salesman with Tillery Chevrolet in Moriarty, tells SFR. “We would like to.”
Some of the 2009 purchases were made using the Houston-Galveston Area Council cooperative price agreement, according to former Public Transit Manager Jack Valencia. In a voicemail, Valencia tells SFR that he doesn’t have the documents to track the 2009 purchases, but adds that he’s sure bylaws were followed “in some form or fashion.”
But in a November 2011 letter, Federal Transit Administration Regional Administrator Robert Patrick writes that cooperative purchasing programs like the one NCRTD used “might not meet the standard of full and open competition” required by federal statute. The district purchases buses with federal funding.
National Bus Sales Regional Sales Director Brent Roy tells SFR he’s not familiar with NCRTD’s potential violations.
“We followed all the procurement regulations we were aware of,” Roy says. “We delivered buses as required by purchase order.”
Roy adds that his competitors have been making “false accusations” about his company.
Romero says she left the district in much better shape after retiring from city council last month. A 2011 audit includes five findings, including internal control weaknesses, but at least one thing has changed: The district can account for its recent bus purchases. Mortillaro provided board minutes for the district’s four 2011 purchases, three of which went to National Bus Sales.
But concerns about the past still linger. Barrone says he may make an inquiry about the 2009 purchases and bring them before the current board.
“We want to follow the law to a T,” he says.