After the Village of Tijeras paid out nearly $65,000 in reimbursements in retirement funds, State Auditor Wayne Johnson sent a letter to the Attorney General which notes “a potential violation of state law.”

Johnson wrote: “The Office of the State Auditor has designated the Village of Tijeras for a special audit of approximately $64,000 in payments made to current employees and Village officials as ‘refunds’ of alleged overpayments of Public Employee Retirement Association (PERA) contributions.”

The payout—in which Mayor Gloria Chavez got a check for $8,707.99 and former interim clerk Diane Klaus got one for $10,752—was based on a resolution the village passed in 2006 defining the village’s contribution to PERA.

Combined, the mayor and clerk received nearly 30 percent of the total payout. Councilor Jake Bruton got a check as well, for $1,889.59.

The checks were issued in January, but January financial statements were provided to the council April 16—that’s when Bruton started asking questions about why the money had been paid out. Bruton said he thought the checks should not have been paid to elected officials in any case.

The Independent’s emails and phone calls to PERA for information have gone unanswered.
Johnson’s letter said staff “discovered Resolution 191, dated in 2006, which provided that the Village would pay the employees’ portion of the PERA contributions. The Village has documentation that this Resolution was forwarded to PERA, as well as a letter from PERA confirming receipt.”

Johnson’s letter goes on to say, that the village “staff” made the determination that the Village had underpaid its share of PERA since 2006, and “calculated the amount they believed had been overpaid. … However, the staff did not verify the estimated overpayments by using the Village’s own payroll records, but instead relied on spreadsheets of the combined Village/employee contributions maintained by PERA. These spreadsheets do not reflect the actual amount paid by each employee.”

The repayments were not approved by the village council. “The Mayor stated that she made an executive decision to issue the checks without approval from the Village’s governing body.”

Johnson’s letter said Chavez’ actions could be in violation of the Governmental Conduct Act, which says a public officer or employee may not “act for the primary purpose of directly enhancing a public officer’s or employee’s financial interest or financial position” and “providing that a public official or employee is disqualified from engaging in any official act directly affecting the public officer’s or employee’s financial interest.”

“The mayor on her own doesn’t have the authority to what amounts to a budget adjustment of 5 percent of the annual budget—that would have to be approved by the [village council] itself,” Johnson said in a recent interview. “They also didn’t handle the disbursement properly.”

Johnson said that because the payouts “were in essence payroll tax” but paid without withholding, “it created a tax liability for each of the employees, plus a tax liability for the village,” which also makes contributions to employees’ retirement funds.

Johnson’s letter also says the Mayor “appears to violate” a state statute giving authority over “the finances and all property, real and personal, belonging to the municipality” and “compensation and fees to be paid [to] municipal officers and employees.”