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Acequia Pathways to Funding: Financial Compliance








On December 4, 2015, NMAA held a workshop entitled Acequia Pathways to Funding: Financial Compliance at the Nambe Community Center. Collaborators on the workshop included the Office of the State Auditor, the Department of Finance and Administration, the Interstate Stream Commission, the NM Association of Conservation Districts, and the New Mexico Acequia Commission.
The purpose of the workshop was to inform acequias about their responsibilities as local institutions of government for financial reporting and audits. This is particularly important for acequias that have received state funding such as Capital Outlay or from the Interstate Stream Commission. Most of the workshop participants had received Capital Outlay and were seeking guidance on reporting requirements in accordance with state mandates for accountability in the expenditure of public funds. After a brief overview of acequia governance and funding opportunities for acequias, representatives from the State Auditor and the Department of Finance and Administration gave detailed presentations.
Lori Narvais presented on behalf of the Office of the State Auditor (OSA) and explained the requirements to comply with the Audit Act. According to the Tiered Reporting System of the OSA, the amount of reporting depends on the amount of revenue received. The following table provides an overview. The vast majority of acequias fall into Tier 1 (Under $10,000) or Tier 2 (between $10,000 and $50,000) and are required to only submit a Certification Letter that states the amount of revenue for the acequia in the previous fiscal year. Tier 3 and higher tiers apply to those acequias who have higher revenues or who have expended Capital Outlay. For those tiers, an AUP Report is required and the report must be completed by a Certified Public Accountant approved by the State Auditor. Lori walked participants through some very important tips for acequia compliance:
1)  Determination of which Tier applies to your acequia.
2)  How to procure the services of a CPA to do a report if you are in Tier 3 or above.
3)Timeline for submission of certification letters or reports.
Lori advised that acequias should submit their certification letters (Tier 1 and 2) or AUP reports (Tier 3 and above) within 5 months of the end of your fiscal year. For an acequia on a calendar year, the deadline would be May 1. For an acequia on the July 1-June 30 fiscal year, the deadline is December 1.
Susan Rodriguez presented on behalf of DFA Local Government Division. She advised that any acequia with revenues over $10,000 in year is considered a "local public body" for purposes of reporting requirements to DFA. The three requirements she mentioned were the following:
1)  Submitting an annual budget to DFA for approval at the start of the acequia's fiscal year
2)  Submitting quarterly budget reports to DFA
3)  Submitting budget adjustment resolutions to DFA when the acequia makes a change to their annual budget.
Susan also reviewed a useful tool, the Treasurer's Worksheet, which was designed in collaboration between NMAA, OSA, and DFA. The worksheet is a simple, formatted Excel spreadsheet that acequias can use to develop their annual budget, keep a general ledger with income and expenditures, and generate quarterly and annual budget reports. The Treasurer's Worksheet is available on both the DFA website and the NMAA website.
Susan also advised on the deadlines for annual budget approvals (for acequias with revenue over $10,000). For acequias with a calendar fiscal year (December 31 end-of-year), their budget for the fiscal year starting January 1, 2016 should have been submitted on December 1, 2015 to DFA for review. The final budget for 2016 should be submitted to DFA by January 30, 2016. For acequias using a fiscal year of July 1, 2016 through June 30, 2017, their budgets are due to DFA by May 30, 2016 with final budgets submitted by July 30, 2016.
It is important that any acequias who received Capital Outlay and plan to expend that funding in the upcoming fiscal year, that the acequia include the Capital Outlay in their revenue for the year. For example, if an acequia received $20,000 in the 2015 legislative session to make plan, design, and construct acequia improvements, and the acequia Capital Outlay funds are available for use (i.e. bonds were sold), then the funding should be included in the acequia annual budget for the fiscal year in which the funds will be spent. If the acequia's fiscal year starts January 1, 2016, then the budget with the Capital Outlay included should have been included in a budget submitted to DFA by December 1, 2015. If an acequia missed that deadline, the budget should be submitted as soon as possible.
NMAA can provide additional guidance in meeting these funding requirements. Please call Serafina at (505) 995-9644 for more information or for contact information at state agencies who can also provide assistance.