Between indictments of public officials and federal investigations of New Mexico's investment policies, 2009 could safely be called the year of the scandal. With tighter ethics bills coming before the New Mexico Legislature from both sides of the aisle, 2010 may turn out to be the year of the reform.
But at the New Mexico Department of Health, a swirling mass of allegations, accusations, threats and denials creates a murky picture of a state agency still caught between the past and the future.
Whistle-blowers allege the DOH is guilty of nepotism and questionable moving of funds.
"I don't even know how to define how corrupt this power structure is," Diane Moore, a business operations specialist who says her complaint against coworkers led to her relocation within the department, tells SFR. "There's immediate repercussions when you say anything. There's a total environment of fear."
Moore named names in a complaint she filed last year in which she alleged that the department was hiring friends and family members of higher-ranking department officials through an "emergency" hire process, and in spite of a state hiring freeze, which has been in place since November 2008.
SFR reviewed Moore's complaint, as well as numerous other public and not-so-public documents, in its investigation of this story. Those documents, as well as an incendiary comment thread on an SFR blog post about the Health Department, paint a picture of an organization rife with problems.
DOH employee Diane Moore claims she was transferred to another DOH division after voicing her concerns about the hiring of DOH higher-ups’ family members.
But that's a characterization some employees dispute.
Donna Trujillo, the deputy director of administrative services at the Health Department, is at the center of both of Moore's complaints: She supervises several of the people Moore named, and she's intimately acquainted with the finances of the federal Women, Infants and Children nutrition program, the subject of allegations from Moore and a second whistle-blower, Robert (Bob) Ortiz.
"There's a lot of stuff that if you don't know what you're looking at, it looks bad," Trujillo says. "But you just can't go with that…until you really understand and really dig into the mechanics of what makes up this program."
Others named in Moore's complaint would not comment for this article, but have themselves filed formal grievances through the DOH's Human Resources Department in which they deny most of Moore's allegations and counter with criticisms of her.
As for the Health Department itself, its official stance is, according to spokeswoman Deborah Busemeyer: "All allegations are false."
As of press time, both Moore and the DOH employees who filed grievances against her have requested independent investigations into her claims. An external audit of the WIC program is pending, following a separate internal investigation that officials claim absolves them of any wrongdoing.
From all the competing accusations and denials, one truth emerges: Something is sick at the New Mexico Department of Health.
Moore says she began voicing her concerns about Health Department higher-ups inappropriately hiring friends and family members when she says she first noticed it, more than a year ago.
"I have always gone through the chain of command," Moore says. "I've written it up; I've gone up to the [Health] Secretary [Alfredo Vigil]; I've gone to [Lieutenant Governor] Diane Denish."
When asked about Moore's complaint, Vigil declined to comment. Denish's spokesman James Hallinan said, "We have no record of ever receiving any complaint from Diane Moore and, if we had received one, we would have referred it immediately to state personnel."
Last November, Moore finally sent a fax formally stating her complaints to state Sen. Sue Wilson Beffort, R-Bernalillo.
Moore's allegations are twofold: first, that DOH higher-ups constitute a "Circle of Trust" that urged the hiring of its own "best friends or family members."
Second, Moore says funds for the federal WIC food and nutrition assistance program (officially, the Special Supplemental Nutrition Program for Women, Infants and Children), which the New Mexico Department of Health administers on the state level, had been improperly moved.
On Nov. 24, Gary Chabot, an analyst with the New Mexico Legislative Finance Committee, of which Beffort is a member, forwarded Moore's complaint to Health Secretary Alfredo Vigil. Chabot requested that Vigil respond by Dec. 2 in order to "prevent this inquiry being pursued by other means such as the press" or by legislators. (Chabot acknowledges to SFR his familiarity with the complaint, but declined to comment for this story.)
Vigil responded to Chabot the following day with assurances that his department's hiring and fiscal practices were in order.
That wasn't enough for Beffort, who brought up the issue when the state's Legislative Finance Committee convened on Dec. 4.
"I have been called by people in the Health Department that are demoralized by the nepotism that has been going on in hiring non-emergency people," Beffort told SFR following the committee meeting. "After the hiring freeze, the Health Department hired, I think, 91 people. It is a misuse of their definitions when they are bringing in people [who are] put in receptionist jobs and then trained into financial positions."
Hiring documentation obtained by SFR shows that the DOH has actually hired 315 people since Gov. Bill Richardson first declared the hiring freeze in November 2008. In a sampling of 157 new hires between September and November 2009, 125 qualified for "blanket approval," or positions pre-approved for hiring by the State Personnel Office—everything from nurses and psychiatrists to chefs, janitors and WIC office clerks.
An SFR blog post ignited a blaze of accusations and recriminations from DOH employees.
On Dec. 4, SFR published Beffort's comments, along with a copy of Moore's original complaint, on its blog, SFReeper.com.
Four days later, an anonymous poster called "health worker" set off a cyberstorm of accusations and insults culminating in thinly veiled threats from both sides.
Posters who identified themselves as former DOH employees named names in what they call a "Circle of Trust"—higher-ranking DOH officials who critics say create an environment of nepotism and special treatment.
Others struck back, defending the employees Moore named. One of them, posting under the name SICK AND TIRED, let it be known on Dec. 17 that action had been taken:
WE FILED GREIVANCES [sic] WITH DOH HR AGAINST THE WOMAN THAT WENT TO THE LEGISLATURE FOR RUINING OUR REPUTATIONS IN THIS BLOG. ANY GUESSES HOW THAT WILL COME OUT? THERE IS MORE THAN ONE WAY TO GET EVEN. I TOLD YOU WE WOULD CRUSH YOU.
By Dec. 16, five of the DOH employees Moore named in her original complaint had filed grievances against her.
SFR's request for those grievances through DOH's Human Resources Department was denied, but SFR was given copies of them by Moore's attorney, Diane Garrity.
In one grievance against Moore, Budget Analyst Stephanie Garcia denies Moore's allegation that she was hired by Bureau Chief of the Administrative Services Division Bernice Gonzales:
"I have been a DOH employee since June 2002 and Bernice wasn't employed at DOH at that time," Garcia writes. (Gonzales did not respond to repeated phone messages detailing the content of this story.)
While Garcia does confirm in the grievance that her daughter, Melissa, also works at DOH, she disputes Moore's assertion that Melissa was brought on as an emergency hire. Indeed, the name Melissa Garcia appears nowhere on the list of the 315 people hired since the freeze. When SFR reached her at work, Stephanie Garcia said, "They've addressed it here, so I'm just going to leave it at that."
Garcia's grievance mirrors those of four other employees named in Moore's original complaint: Accountants/Auditors Renee Turner and Valerie B Dixon-Paulk, Management Analyst Maureena Martinez-Williams and a clerk named Trina L Valdez. (SFR attempted to contact each grievant individually, but multiple messages were not returned.)
Four of the grievances accused Moore of violating the DOH's Code of Conduct and of "violence in the workplace," a definition which includes "harassing, intimidating [and] coercing," among other offenses.
"Since the first day of my new Job…when it came time to be introduced to Diane the only thing she said to me was 'AND WHO ARE YOU RELATED TO!'" Valdez' grievance reads. With it are two signed testimonies from Valdez' then-coworkers, who say they heard the same thing.
All grievants requested that Moore be transferred out of her position at the Public Health Division director's office. On Jan. 5, their wish came true.
"In less than 24 hours, I was removed from my job, which I have done very well for three years," Moore says. A recovered paraplegic who walks with a cane, she says she was left to move her possessions out of her office at the Harold Runnels Building to her new position at the Developmental Disabilities Supports Division.
Neither her title nor her salary has changed, but Moore says her access to the DOH's financial systems was removed and her job responsibilities suspended—even though the justification for the relocation was "to ensure continuity and efficacy of Department operations," according to a Jan. 4 letter Moore received from Daniel Jacobs, the DOH's human resources director.
"I told [my superiors] I was not interested in being relocated, that I was very happy where I was [and] I hadn't done anything wrong," Moore says. "I had only told the truth."
Although Moore has retained counsel, Garrity, her attorney, says she has not filed suit. Garrity, who has experience working on similar DOH-related cases, says right now Moore is just hoping to get her job back, but that the DOH hasn't yet responded to that request.
"What we're really trying to do is make the DOH do the right thing by informing their employees that you're just not allowed to file grievances against anybody willy-nilly," Garrity says. "They should be protecting the person who disclosed the information, not the employees that are upset about the information being disclosed."
As vicious as the comments on SFReeper.com became—"YOU ARE ALL A BUNCH OF GOSSIPING BITCHES," one reads—few ventured into the content of Moore's other claim, that the DOH was moving WIC funds in a questionable manner.
Created in 1972 to provide food and nutritional supplements to the nation's neediest women, infants and children, WIC now serves almost half of all infants in the US.
Unlike most other public-assistance programs, WIC is 100 percent federally funded: Grants from the US Department of Agriculture, which administers the program, cover states' food and administrative costs.
The New Mexico Department of Health receives approximately $30 million a year to administer WIC, reimbursing grocers so WIC participants can obtain food items—everything from infant formula to cans of tuna—for free.
Through public records requests, SFR obtained approximately 200 pages of financial reports, correspondence and copies of recent internal and external audits of New Mexico's WIC program.
Problems with the program appear to have begun in 2006, when the USDA asked the New Mexico DOH to perform a reconciliation of its WIC finances.
The problems did not end then. And in November 2008, Bob Ortiz, a former Los Alamos National Laboratory employee, was hired as a deputy director in the Grants Management Bureau of the DOH's Administrative Services Division. Ortiz, who was responsible for $540 million in federal money at LANL, says he was hired by DOH in part to address the WIC program's fiscal snafu.
Ortiz says he organized a team to examine WIC financial records dating back to 2006. It took three months but, by February 2009, Ortiz had found that the program's finances were off by $1.7 million.
Ortiz says he traced the problem to 2006, when two rebate checks—income from infant formula manufacturers that offer rebates in exchange for exclusive-provider agreements with WIC—were misfiled. The error had never been dealt with, creating a ripple effect that eventually manifested itself in the 2008 fiscal year.
According to whistle-blower Bob Ortiz, New Mexico’s WIC program inappropriately managed $1.7 million.
In April 2009, Ortiz and his team went to the Dallas offices of the Food and Nutrition Service, the USDA division that runs WIC. His superiors, he says, had instructed Ortiz to ask the USDA for money while the DOH solved its accounting problems.
The feds weren't having any of it. In a May 1, 2009 email to Ortiz and his team, Sunil Saraf, a USDA accountant, declined to give the DOH any more money unless it could justify additional expenses.
"Well, that's about no help at all," Michael J Mulligan, one of Ortiz' superiors in the Administrative Services Division, wrote to Ortiz in response.
Another solution was needed.
"It shouldn't have taken that long to resolve," DOH Secretary Alfredo Vigil admits. "The good thing that happened over the last few months is we said, 'We can't fiddle around with this any longer; we're going to have to roll up our sleeves and try to come up with some kind of a solution."
But according to Ortiz, the "solution" DOH came up with is where the problems really began.
On June 30, 2009, the last day of federal fiscal year 2009, Ortiz claims Mulligan directed him to perform an accounting sleight of hand. Ortiz alleges Mulligan told him to transfer the unaccounted-for $1.7 million from fiscal year 2008 into the 2009 federal fiscal year (different from the state fiscal year by approximately three months).
Ortiz did as instructed. But he labeled the transaction "as requested by management."
That label, Ortiz says, was his "only cover"—the only paper trail to prove that there was no other justification for the fix.
The records were not provided by the DOH in response to SFR's public records request. Rather, SFR obtained them from Ortiz.
Ortiz still maintains that the $1.7 million actually belonged in federal fiscal year 2008: That's where it was spent, he says, and that's where it should have been recorded and reported to the USDA.
Shifting it over to FFY '09, Ortiz says, is tantamount to robbing New Mexico's taxpayers—not to mention its neediest mothers and children—of $1.7 million in supplemental food and nutrition, plus additional income from formula rebates.
After the transaction occurred, Ortiz made his concerns known. On July 10, he was asked by Mulligan and Deputy Secretary Duffy Rodriguez to turn over his WIC-related duties to Administrative Services Deputy Director Donna Trujillo.
(Neither Rodriguez nor Mulligan responded to multiple messages left on their voice mails detailing the contents of this story.)
In December 2009, SFR filed a series of formal requests under the New Mexico Inspection of Public Records Act for, among other items, audits, internal correspondence and "any and all emails, memos, letters and/or other correspondence related to any and all allegations of fraud related to the WIC program."
While the DOH did deliver some documents, it does not appear to have furnished all the existing documents, such as the note regarding the $1.7 million. Ortiz also provided SFR with other documentation the DOH did not produce.
For example, one email documents Ortiz' surrender of his WIC duties to Trujillo. (Trujillo acknowledged and recognized the email when SFR presented it to her.)
Another document the DOH did not produce is Ortiz' Aug. 10, 2009 formal complaint to Health Secretary Alfredo Vigil regarding the $1.7 million transfer.
"I have not had a good night sleep since that draw was completed," Ortiz writes. "Aside from being treated with hostility, I was forced to immediately reassign [a member of his financial team] off the WIC Project because Deputy Secretary Rodriguez said she was a F__king Idiot and I was directed to halt working on the issue," Ortiz writes. "[T]o put it bluntly for NMDOH to draw the FFY09 WIC Grant to pay the FFY08 expenses…smells and feels like fraud to me."
Ortiz went on to ask Vigil to order the DOH to return the $1.7 million to the USDA, since it hadn't been spent on actual WIC needs, and to provide him protection under the whistle-blower clause of the state's Fraud Against Taxpayers Act.
The following day, on Aug. 11, Ortiz says he stated his case, again, in a formal presentation to Vigil. (When asked to confirm that presentation, Vigil tells SFR, "No, I can't. No comment.")
Ortiz says he explained to Vigil the problems with WIC's finances—including his belief that the $1.7 million "fix" amounted to robbing New Mexico taxpayers.
After what he describes as a confrontation the next day with Mulligan—another email Ortiz gave SFR highlights their continued disagreement about whether the $1.7 million fix was valid—Ortiz took the hint and asked for
relocation within the department, plus 10 days' administrative leave.
On Sept. 21, the DOH's Office of Internal Audit completed an investigation of the WIC program that calls for better accounting practices and the resolution of the $1.7 million issue.
But Ortiz says that despite his complaint, the auditors didn't interview him. (One of the auditors involved, Jim Green with the DOH's Office of Internal Audit, did not respond to SFR's voice mail messages detailing the content of this story.)
A compulsory annual external audit also examined the WIC program and, though the DOH promised to provide a copy of it to SFR on Jan. 8, by press time no external audit had been received. In that case, Ortiz claims the auditors asked him about the WIC program but not about the specific concerns he had voiced.
A third, federal audit is scheduled to be completed before June, but USDA Southwest Region Public Affairs Director Patricia Mancha says the audit was planned before the USDA received Ortiz' complaint.
Then, Mancha tells SFR, "the Office of the Inspector General did review the complaint, and they determined that there were probable accounting errors, but there was no indication of fraud."
From the DOH's perspective, it seems everything has already been resolved.
"The federal accounting people and our own independent accountants who do our annual audits looked at [Ortiz' concern], and in neither case did a whole lot of very smart and objective and external people find anything that would indicate that anybody did anything wrong," Vigil tells SFR. "A lot of this is accounting adjustments, not some big, horrible problem," he adds. "In my mind, as secretary, this got put to bed and the case closed when we resolved the accounting problem."
Trujillo took over WIC accounting duties from Ortiz and met with SFR in January to explain the program's finances. She says she found the original glitch in the 2006 rebates and that made everything else fall into place. Trujillo further asserts that the original $1.7 million actually belonged in fiscal year '09, and that the original accounting process, which attributed the expenses to FY '08, was wrong. But she also tells SFR that the federal reporting forms that document WIC finances from each fiscal year have always been correct.
Ortiz isn't buying it.
"I believe in my heart we owe that money back," Ortiz tells SFR.
So be it, Vigil says.
"Since this is a free society and people get to speak anytime they want, there apparently are people still out there saying somebody did something wrong," Vigil says when SFR asked him to respond to the ongoing concern about the $1.7 million glitch. "We may never be able to put that to bed if people are convinced in their own minds, even if there's no proof of such a thing, that somebody did something wrong."
While DOH claims the issue has been put to rest, there is reason to think otherwise.
The entire department has not been labeled low-risk by federal auditors since 2006 "mainly because of past problems with the WIC grant," DOH spokeswoman Deborah Busemeyer writes in an email explaining the designation to SFR.
And according to Trujillo, the WIC program is currently working on yet another fiscal reconciliation. A Dec. 4 email (furnished, once again, by Ortiz) from the USDA Office of Inspector General's assistant special agent in charge, Gregory Henderson, attests to continued issues.
"The primary problem with the New Mexico WIC program," Henderson writes, "is improper cash management."
The DOH also downplays the personnel issues sparked by Moore's complaint.
File Photo
According to Department of Health Secretary Alfredo Vigil, the DOH’s hiring and fiscal practices are in order.
Secretary Vigil declined to comment on Moore's situation, but says he doesn't "agree that anybody was involuntarily relocated."
Moore and the women who filed grievances against her all have requested an independent investigation.
"We look into things constantly," Vigil counters. "Every day our HR department looks into these investigations."
Of course, Moore's complaint is against that very Human Resources Department. Vigil said he could not comment on "details or names or specific circumstances."
External agencies and observers remain mum. The Office of the State Auditor did not return repeated requests for comment on the subject of the WIC allegations.
Gilbert Gallegos, Gov. Richardson's deputy chief of staff, responded to a request for comment in an email: "I understand the Department of Health has answered your questions, and I don't have any [sic] further to add."
Sen. Dede Feldman, D-Bernalillo, tells SFR she "received a call from someone at the Health Department a couple of months ago," but says she has no comment on the issue.
Rep. Luciano "Lucky" Varela, D-Santa Fe, who chairs the Legislative Finance Committee, says his only concerns about the DOH relate to budget cuts: If the LFC's proposed budget is approved, the DOH stands to suffer a 5.2 percent budget cut, and Varela says approximately 100 full-time positions (most of which have been empty for over a year) will be eliminated.
But Sen. Beffort, whose comments in December sparked some of the controversy, remains concerned about the department's hiring practices.
The DOH, she says, has had "more hires during the freeze than any other department. We thought it was in the name of critical hires, such as nursing personnel, but to have these loopholes—I think it's disrespectful of the intent of the hiring freeze when we're facing such a financial crisis."
Beffort pauses, and appears to choose her words carefully.
"It's what you didn't want to think government was like," she says. SFR
