State Auditor talks new local dispatch center, accountant shortages

SANTA FE — State Auditor Joseph Maestas isn’t worried about how the city of Rio Rancho is handling its money. Since the state’s third-largest city has repeatedly come back with clean audits, New Mexico’s “financial watchdog,” as Maestas calls his office, might have more time to oversee Sandoval County’s new dispatch center or find ways to slow a shortage of accountants.

These were all subjects Maestas, who is preparing to run next year for a second term, touched on in a wide-ranging interview Wednesday with the Observer.

“If you look at the audit outcomes for the city of Rio Rancho and Sandoval County, they do a great job in their audits and they have minimal findings,” Maestas said in a virtual interview from his Santa Fe office.

Earlier this year, Rio Rancho and Sandoval County elected officials heard from independent public accountants (IPAs), who reported clean audits that had been submitted to Maestas’ office in December. The auditor’s office approves IPAs every year to represent the state in conducting audits on approximately 1,200 public entities in New Mexico, according to Maestas.

But of the thousands of accountants contracting with the auditor’s office, Maestas is worried that there aren’t enough of them to do the work — and some are leaving.

Though Maestas is aware of the industry dynamics, it doesn’t change the fact that he’ll need IPAs to audit the state’s public institutions, including Sandoval County’s new dispatch center.

New dispatch center

The county’s center for handling emergency calls began operations July 1. Earlier this year, Corrales, Bernalillo and Santa Ana Pueblo entered into an agreement with the county to have their dispatch services overseen by the center. Rio Rancho announced it would not be part of the agreement and instead handle its own calls out of an independent dispatch center.

The new arrangement comes following a clash between Rio Rancho and the county, when it issued a letter to city officials in August 2023, alleging the city was in violation of the 2015 agreement. Months later, Rio Rancho responded it was walking away from the agreement.

The correspondence was the beginning of the new arrangement: the county partnering with other municipalities for emergency calls, while Rio Rancho got its own dispatch center.

Maestas told the Observer that before the new arrangement, he was integral in conversations between Rio Rancho and the other municipalities — holding private virtual calls with most town leaders, avoiding a special audit for alleged waste, fraud and abuse and instead launching an expanded 2024 audit of each member of the then-agreement.

"Our goal is to help communities get it right — not just to catch them getting it wrong," Maestas wrote in an email to the Observer.

With the new arrangement in place, Maestas said the county dispatch center will be audited just like any other public entity. The Office of the State Auditor will focus on auditing the what is generated from the agreement, including the center’s cash balance, amount of money paid to and owed by participants and call volume.

Maestas said he is not concerned with Rio Rancho acting as a financial administrator of its dispatch center. The real “learning curve,” he said, will be on Sandoval County.

This is not a reflection on the county’s overall ability to manage public funds, but rather an acknowledgment that standing up a new ECC requires specialized planning, systems, and oversight," Maestas wrote in an email to the Observer.

He is hopeful the county's dispatch center will be transparent in its practices.

"We are ready to support them as they build this new capacity," Maestas wrote.

Accountant shortage

Accounting positions are expected to grow by 6% until 2033, according to a 2023 report from the U.S. Bureau of Labor Statistics. At the same time, the report said, over 130,000 openings are expected each year as accountants leave the workforce.

Informed of those figures, Maestas acknowledged the public accounting industry is “contracting” throughout the nation, not just in New Mexico.

He pointed to his estimate that around 75% of accountants are eligible to retire and students interested in accounting believe in a number of industry misconceptions, including that accounting is underpaid and contains no work-life balance.

“This misunderstanding really discourages students from pursuing a major in public accounting,” he said.

What’s more, the industry’s 150 credit hour rule — the amount of college credits needed for students to take the CPA exam — conflicts with the 120 credit hours typically needed to earn a bachelor’s degree in the field, Maestas said.

“The 150-hour rule is discouraging not just for young students, in general, but minorities,” Maestas said.

The accountant shortage not only means there are fewer IPAs ready to roll up their sleeves, but there has been an increase in late audits and more disputes between public entities and accountants on those delays, according to Maestas.

“These are the symptoms that are occurring because of this (accounting industry) contraction,” he said. “From my perspective, as the state financial watchdog, it’s incumbent upon me to help establish a talent pipeline.”

So what are some solutions? The Office of the State Auditor sent a letter to Gov. Michelle Lujan Grisham, asking her to increase the higher education endowment fund, with public accounting as a focus. The office is also encouraging higher education leaders to include accounting under the STEM (science, technology, engineering, and math) umbrella.

“It would certainly stimulate more interest on the part of students to pursue careers in accounting” Maestas said.