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PRC Bypasses State Auditor

SANTA FE, N.M. — A special audit of the Public Regulation Commission won’t be conducted by the office of State Auditor Hector Balderas.

The decision followed a contentious meeting in which PRC Chairman Pat Lyons was “verbally abusive and physically threatening” with Office of the State Auditor staff, according to a letter Balderas sent Wednesday to the PRC and media members.

Lyons said an independent auditor should have been hired for the job all along, and accused Balderas of playing politics to bolster his campaign for the Democratic Party’s nomination to the U.S. Senate.

“Balderas wants to further himself politically by taking down Jerome Block,” Lyons said. “We want it (the special audit) done good, not with the politically motivated agenda he has.”


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Balderas called those statements “absolutely ridiculous.”

The auditor’s office was to examine embattled Commissioner Jerome Block Jr.’s gasoline-card expenditures – shown in records to have included several fill-ups within minutes of each other at Española gas stations – as well as other potentially dubious expenditures by Block and other PRC employees.

“The OSA planned to conduct a special audit of PRC transactions and controls related to travel, per diem, vehicle and gas charges” that have occurred since Block took office, Balderas’ letter said.

A meeting Tuesday between state auditors and PRC officials, including Lyons, was an “entrance conference” to initiate the audit. But at that meeting, Lyons called attending state auditor employees “a bunch of snakes,” the letter says, and claimed they were on a “witch hunt.”

Lyons released his own statement late Thursday, in which he denied ever intimidating members of Balderas’ staff.

“I was very direct and straight forward, but for anyone to interpret my directness as hostile is unreasonable,” he wrote.

Balderas said his agency will oversee whichever auditor is contracted for the job, but can’t take on the task itself after the meeting with Lyons, who “was threatening he was going to tell employees to not provide documents to auditors,” according to Balderas.

Lyons, a Republican, was State Land commissioner before taking a seat on the PRC, a powerful regulatory body that oversees utilities and the insurance and transportation industries. Balderas oversaw a critical audit of the State Land Office in 2010, during Lyon’s tenure there.


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Lyons brought documents to the Tuesday meeting that he said demonstrated that the 2010 audit “wasn’t well done.” According to Balderas’ letter, Lyons also repeatedly referenced that audit to auditor’s office staff at the meeting, and at one point slammed a box filled with the documents onto a table in front of Balderas’s chief of staff.

“I believe it’s highly inappropriate now for him to interfere with this audit just as an old, personal bias,” Balderas said.

But Lyons said the auditors “threatened us three times it would cost a lot more if we go independent,” and also inappropriately leaked documents outlining the scope of the audit in a letter to the PRC that was also distributed to media.

“We want the audit done by an independent auditor regardless of whether Jerome Block resigns or is impeached,” Lyons said.

An impeachment committee has been convened in the state House of Representatives to investigate the charges against Block and consider the impeachment question.

Lyons said Thursday he had heard Block would resign soon. Block was not at Thursday’s PRC meeting and did not return a message seeking comment.

However, he wrote in a text message: “No, I am not resigning now. I don’t know where they got that from.”

Block’s fellow commissioners recently stripped him of his vice chairmanship and called on him to resign – a plea that was echoed by prominent politicians from both parties statewide. The House panel investigating whether or not to impeach Block announced Thursday that it had hired former federal prosecutor Robert Gorence to handle the investigation.

Gorence is an Albuquerque defense attorney and was a prosecutor in the U.S. Attorney’s Office. He will gather evidence to present to the House subcommittee, which will decide whether to recommend impeachment. A majority House vote is required to impeach Block, who would then be tried in the Senate, which can remove him from office with a two-thirds vote.

The Associated Press contributed to this report.