Fiscal Agent to Help City Use State Appropriations

Dollars appropriated by the Legislature two years ago and dedicated to five City of Santa Fe projects could soon be available following the City Council and the mayor’s approval of an agreement for fiscal agent services Wednesday night.

City Attorney Erin McSherry and Finance Director Emily Oster worked together and recommended the contract with the North Central New Mexico Economic Development District to oversee spending of five grants from fiscal year 2021 for a 3% fee.

The district, an association of local government entities and other organizations created to encourage and allow regional cooperation, will help the city receive $1 million for an upgrade to Santa Fe parks; $300,000 for construction of a trail in the Tierra Contenta neighborhood; $1 million in infrastructure improvements for Midtown; $250,00 for improvements to the Santa Fe Homebound Meals program; and $1.8 million toward the Santa Fe Teen Center.

The contract follows an August letter addressed to Mayor Alan Webber from the Department of Finance Administration informing him the city would not be able to draw down on capital appropriations from the Legislature until all its late audits were completed. The department suggested the city could hire a fiscal agent to help gain access to the cash.

The city’s perpetually late audits still aren’t caught up. Finance officials completed its  2021 fiscal year audit last August after missing the due date of Dec. 31, 2021; the audit for fiscal year 2022 went to the state auditor last week instead of in December 2022; and the fiscal year 2023 isn’t expected to wrap until May.

Outgoing District 1 Councilwoman Renee Villarreal asked before the vote how the agreement would work for projects which have appropriations across multiple fiscal years. Oster replied that the city receives a separate grant agreement from the DFA for each appropriation, even if the money goes toward the same project.

“I trust that we have a grants administrator that can keep track of all of that,” Villarreal said.

During a brief introduction of the contract, McSherry made it clear the fiscal agent would not be permanent.

“If and when, and when I think is the key word, the city no longer needs the fiscal agent agreement, then we would recommend terminating it,” McSherry said during the meeting, “and then we would ideally not be using that type of an agreement. But in the interim, it’s the best solution that we have at our availability.”

The city or the district can end the agreement with 30 days notice at any time, per contract language.