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Audit: $1 million, 12 miles of broadband cable not accounted for

SANTA FE — Those in charge of a $10.5 million, federally funded project to bring broadband services to parts of northern New Mexico can’t account for how almost $1 million was spent or say what happened to 12 miles of fiber optic cable, according to a new state audit.

The State Auditor’s Office said it is still looking for missing documentation for the REDI Net project and has served “several subpoenas on contractors and vendors who received significant payments from the broadband project.”

“These federal dollars were meant to bring broadband connectivity to people throughout northern New Mexico,” state Auditor Wayne Johnson said in a news release. “There are some serious questions about a lack of records and controls to assure taxpayers that these funds were used effectively and responsibly.”

State Rep. Jim Trujillo

State Rep. Jim Trujillo, D-Santa Fe, is board president of a local economic development district that received the federal funding. He said he disagrees with the audit’s findings.

“We did it under federal economic development grant and we met the requirements of the grant,” Trujillo said. “When we finished the job, we turned it into the federal government with a list of what we had done, and they approved it.”

The State Auditor’s Office on Tuesday released the audit that was performed for the office by Jaramillo Accounting Group of Albuquerque.

The REDI Net project was financed in 2010 with $10.5 million in post-recession stimulus money from the American Recovery and Reinvestment Act. The money went to the North Central New Mexico Economic Development District, a consortium of counties.

REDI Net later was set up as a separate government entity. Its website says it is run by the North Central district; Santa Fe, Los Alamos and Rio Arriba counties; Española and the pueblos of Pojoaque, Ohkay Owingeh, Santa Clara and Tesuque

The audit says that in 2016, Rio Arriba took over from North Central as fiscal agent. During the changeover, “questions arose and information came to the attention of the REDI Net board that caused concerns about certain transactions” that North Central had charged to the federal grant. Rio Arriba officials communicated those concerns to the State Auditor’s Office, which in March 2016 designated North Central for a special audit. REDI Net paid for the audit.

The audit identified $955,792 for which North Central was unable to provide supporting documentation. The 12 miles of missing cable is valued at nearly $200,000, the state auditor’s office said.

David Trujillo, Rio Arriba deputy county manager and vice chair of the REDI Net board, said the findings are “very serious and confirm many of the concerns that the REDI Net Board has raised.”

Gabriel Montoya, chair of board, said it agrees with the findings and hopes that updated audit results from additional subpoenas will provide more clarity so the organization can “close the books” and move forward.

REDI Net is providing high-speed internet to about 75 “anchor” institutions like schools, hospitals and government agencies. The system is set up for other internet providers to take on the role of “last mile” services to individual customers like homes and businesses.

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