Past audits have not been so good for the North Central Regional Transit District, but it would appear that it has turned a corner, as it was presented with a clean audit during a Jan. 10 Board of Directors meeting.
A repeated material deficiency from 2008 was the only finding Albuquerque-based auditing firm Hinkle and Landers spotted over the course of the 2013 fiscal year.
“If you look at past audits, you can go back and find 11 findings,” District Executive Director Anthony Mortillaro said. “There’s just one pesky one and we hope to address that this year.”
The “pesky one” was a material deficiency concerning controls over maintaining the general ledger.
The material deficiency was caused by an asset being listed in the expense account instead of the asset account.
“This significantly increases the potential for misstated financial statements,” the audit states.
District finance department officials argued the asset was ordered in the 2013 fiscal year, but had not been received or paid for until the 2014 fiscal year, causing them to list it in the expense account.
The adjustment to the accounts was made by the auditors and the firm suggested they inquire with the auditors if a similar situation occurs in 2014.
There were no new findings discovered by the auditors, furthermore, the audit states the four findings found in the 2012 audit were resolved.
“I think this is the cleanest audit and the best audit,” Hinkle and Landers President Farley Vener said during the presentation.
The audit also provided a financial analysis for the District’s 2013 fiscal year, which shows it increased its total assets by 11 percent, to $14.7 million. The increase was attributed to the addition of the Jim West Transit Center, bus shelters and four buses to the District’s asset pool.
Revenue saw a dip from $10.2 million in 2012, to $9.3 million in 2013. The revenue from gross receipts tax, federal grants, charges for services and interest income were all down.
In addition, the total operating costs increased by 8 percent in 2013. Personnel services, operating costs and non-operating costs all experienced an increase. Non-operational costs are defined as payments to the RailRunner, the City of Santa Fe and Los Alamos County for providing regional services.
The Board voted unanimously to accept the audit, with one of the votes coming from Rio Arriba County Commissioner and Board Vice Chair Barney Trujillo, who hadn’t attended a Board meeting in six months.
Rio Arriba County Manager Tomas Campos was also present.
In a subsequent presentation, Mortillaro said adding and altering District routes would decrease the operating costs featured in the audit report.
He said implementing the District’s service plan update could actually save it money in the future
During the presentation, he gave recommendations based on the improvement options that consulting firm KFH Group had given at the December Board meeting.
Mortillaro said he was looking for informal responses and suggestions from the Board before the recommendations are put to a vote next month.
“I just want to see whether the heads are going yes or going no,” he said.
The heads were going yes for a modification to the Riverside route that cuts the five stops south of the Lovin’ Oven, except during peak hours.
The Board was also in favor of converting the west side route into a crosstown route that would cover Española’s west and east side.
Projects and Grants Specialist Stacy McGuire said District officials are considering adding stops to Española Valley High School and Wal-Mart, in addition to the changes already being proposed.
Española mayor pro tem and Board member Dennis Salazar gave it his seal of approval.
“I feel that just within the route from the west side to the east side, it services more people,” he said.
Another route that could see significant transformation is the Chama to Española route.
Mortillaro proposed expanding the route’s operating schedule from three days a week to five days a week.
He said this change would take course over a six-month trial before District officials would decide to keep the change or revert to the three-day schedule.
McGuire said District administrators wanted to go with the changes because the District received feedback indicating riders wanted more trips to Tierra Amarilla for visits to the courthouse and the detention center.
McGuire said interest in expanding the route also came from riders from the northern portion of Rio Arriba County who commute to the Los Alamos National Laboratory.
The proposal also adds 14 more stops to the Chama to Española route.
For commuters to Los Alamos that don’t live more than 100 miles away, the Española to Los Alamos to Pojoaque route was also the subject of proposed changes.
Mortillaro suggested the route be turned into two subsequent loops, with one round-trip from Española to Los Alamos and back, and another trip from Pojoaque to Los Alamos and back.
While KFH Vice-President Ken Hosen left the option open for multiple round-trips to each destination during the last meeting. Mortillaro said there would be only one of each to start.
Los Alamos County Council Chair and Board Treasurer Geoff Rodgers said he would like to see more stops in Los Alamos for the new route, including stops at Smith’s and the Los Alamos Airport.
Other local routes that saw proposed changes at the meeting were the Española to Santa Fe route, the Taos to Española route, the Española to El Rito route, the Chimayó to Las Trampas Route and the Española to Chimayó route.
The Board will vote on these proposed changes at their next meeting Feb. 7.
The Board discussed other items at the meeting, including:
• Shoppers interested in buying a van but dissatisfied with the lack of vans in bright blue might be in luck. The Board voted Jan. 10 to authorize the auction of four vans and other District equipment.
A District agenda report states one Board member and two alternate designees — Rodgers, Campos and Santa Fe Transportation Director Jon Bulthuis — met before the meeting and approved a list of obsolete fleet and property.
The four vans to be auctioned off had small passenger capacities, ranging from six to 12. The vehicles met the state Department of Transportation replacement criteria; all were more than four years old and surpassed 100,000 miles.
The Board also approved the auction of 35 two-way analog radios, a couple of two-way hand radios, seven fare boxes, three document shredders, a printer and a flat screen monitor.
• The Board unanimously approved an Open Meetings Act resolution for 2014.
As in 2013, Mortillaro said most meetings will be on the first Friday of the month. He said the meeting in July would be on the second Friday of the month in observance of the Fourth of July.
The meeting in January was moved from the first Friday of the month because of the holiday season.
• The District’s monthly financial summary produced mixed results.
The summary states the District took in $3.6 million, while expending $3 million.
Expenditures remain low because the District has yet to make quarterly payments to Los Alamos County and the City of Santa Fe for transit services.
While District officials won’t know how much gross receipts tax revenue they’ll receive until the state Governmental Accounting Standards Board posts them in March, the gross receipts posted for October delivered both good and bad news.
Los Alamos County paid $33,137 in gross receipts tax, which was below the modest projection District officials set at the beginning of the fiscal year.
District Finance Director Glenda Aragon said the low figures could be attributed to the federal government shutdown, which temporarily closed the Los Alamos National Laboratory.
Rio Arriba County also continued to underperform, mustering 93 percent of its expected $49,364 contribution.
Despite those low contributions, Santa Fe County and Taos County contributed more than expected and the District received 104 percent of its expected revenue through October.
• At the beginning of the meeting, Rodgers announced it would be his last as a Board member.
He cited time constraints as the reason for his departure and introduced Los Alamos County Councilor Pete Sheehey, who was in the audience, as his replacement.
While Rodgers already has his replacement set up for next month, the District will have to find a new treasurer.
District Public Information Officer Jim Nagle said the Board will vote for an interim replacement at the next meeting. Whoever replaces Rodgers as treasurer will serve a short term — the Board will vote to fill the three officer positions in April.