Finding Text
2022-007 Premium Pay (Other Non-Compliance) Assistance Listing Number 21.027 Federal Agency Department of Treasury Program Name Coronavirus State and Local Fiscal Recover Funds Award Number Multiple Award Year 2021-2022 Question Costs None CONDITION: During our testing over premium pay, we noted that 6 elected officials were incorrectly paid premium pay totaling $6,000. CRITERIA: Per 31 CFR Part 35 [RINI505-AC77], Coronavirus State and Local Fiscal Recovery Funds, Final Rule and 2 CFR ?200.318 (C) elected official are prohibited from using funds to pay themselves premium pay. The New Mexico Governmental Conduct Act states that public official at any level of New Mexico state or local government shall not take an official act primarily to improve the employees financial interest or position. EFFECT: The City is not in compliance with state and federal regulations. CAUSE: The City awarded Premium Pay to all City employees including elected officials. AUDITOR?S RECOMMENDATION: We recommend the City create internal controls to ensure that they review federal and state regulations prior to disbursements to ensure costs are allowable. We also recommend the City work with elected officials to create a corrective action plan to recoup the federal funds. MANAGEMENT RESPONSE: Initially premium payments were only made to paid staff. Management was unaware of the provisions in reference to elected officials not being able to receive premium pay so they requested premium pay for the elected officials at a later date. The City Manager has sent an email to all elected officials requesting that the funds be reimbursed to the City. At this time (3) three of the (6) six elected officials have reimbursed the City and the others have committed to do so as well. RESPONSIBLE PARTY: City Manager/Finance Director TIMELINE FOR CORRECTIVE ACTION: June 30, 2023