But the asset management plan will come after the City has just completed a three-year $6-million upgrade to its wastewater treatment plant and numerous lift stations.
The City was awarded $5,000,600 in grants and $1,030,000 in loans from the U.S. Department of Agriculture in 2017, with sewer rates going up correspondingly.
The planning will also happen after a nearly $500,000 upgrade to a sewer vacuum system replacement and upgrade project was begun in 2019, which is still ongoing.
The City took out a $373,000 loan from the New Mexico Environment Department for 20 years at 1.2 percent interest, which comes to about $420,000 total. The rest is being funded by a grant from the same entity.
An asset management plan, according to the Environmental Protection Agency, should include:
— An inventory of assets
— An evaluation of assets’ condition and performance
— Development plans to maintain, repair and replace assets
— Plans for funding these activities
The City has hired outside help—instead of department heads generating asset management plans internally—for the Electric Department (about $115,000 to rate payers) and the Water Department (amount unknown).
An indicator that the City utility departments have not been operating under asset management plans can be seen in audit findings.
The Sierra County Sun checked City audits dating back to 2012 and found the City had audit findings for not keeping proper asset inventories from 2012 to 2017. The State of New Mexico and AXION performed those audits and gave the City serious audit findings labeled “material weakness” and “significant deficiency.” The labels mean it is likely “financial misstatements” in assets would be made. Both auditors found millions of dollars in asset misstatements.
The problems were “resolved” under the current auditing firm’s oversight, Patillo, Brown & Hill, which has done the last three audits. Its contract was renewed for this year’s 2019-2020 audit by the City Commission last month. The firm has mainly focused on cash drawers and timely deposits, never giving the City serious audit findings.
The City Commission approved the grant application submission to the New Mexico Finance Authority at the July 24, 2019 meeting, without seeing the application and without a dollar amount listed for the grant, according to records available on the City’s website.
The current City Commission accepted the $50,000 award with zero discussion, again, with no application provided. The award letter from the NMFA states the plan must be completed within 18 months.