Regular Finance Committee Meeting - Last Monday
Tue, May 27, 2025 · Finance Committee
https://santafeminutes.space/meeting/292

== Executive Summary ==
The Finance Committee held its regular meeting, approving the agenda and consent agenda with one item, K, pulled for separate discussion. The committee recognized two key Finance Department staff members: Jasmine Reyes for her diligent work in payroll and Anita Medina for her 25 years of public service, particularly in personnel budgeting, as she approaches retirement.

The main discussion revolved around Item K, an amendment to increase legal services funding for the Midtown Property Development by $120,000, bringing the total to over $412,000. City Attorney Aaron McSherry explained that the increase was due to the evolving complexity of redevelopment phases and disposition agreements. The committee ultimately approved this amendment. Additionally, the committee discussed utilizing Metropolitan Redevelopment Agency funds for current and upcoming projects, a resolution to restrict the weight limit on Sarra Gordo Bridge, and an update on a recent city account compromise incident where a vendor payment was redirected. Director Oster outlined the city's immediate security measures and ongoing investigation into the compromise.

== Key Decisions ==
- Approved the meeting agenda.
- Approved the consent agenda, with Item K pulled for separate discussion.
- Approved the amendment to the legal services agreement for Midtown Property Development, increasing the not-to-exceed amount by $120,000 to a new total of $412,160.25.
- Discussed utilizing $60,000 from the Metropolitan Redevelopment Agency for current year projects and an additional $60,000 for the next fiscal year.
- Discussed a resolution to restrict the weight limit on Sarra Gordo Bridge #8838 to 15 tons until repairs are made, and to install warning signs and notify relevant state departments.

== Motions & Votes ==
- Motion to approve the meeting agenda — Passed unanimously.
- Motion to approve the consent agenda (as amended with Item K pulled) — Passed unanimously.
- Motion to approve Item K (amendment to legal services agreement for Midtown Property Development) — Passed (Councilor Lee Garcia: Yes, Councilor Romero: Yes).

== Public Comment ==
No public comment period was held. Councilor Lee Garcia clarified that item I, initially pulled for discussion, would be discussed during its final passage at a later date.

== Topics ==
- Midtown Property Development
- Vendor Account Compromise
- City Staff Recognition
- Cybersecurity Measures
- Fraudulent Payment Recovery
- Legal Services Agreement
- Sarra Gordo Bridge Weight Limit
- Payroll Operations
- Budget Office Functions

== Full Transcript ==
Okay. Can I hear myself? Do we have the ability to go live?

Madame Chair, Councilor Romero, we are live.

Thank you. At, I guess it's about, well, let's see, it's 5:12, and I'll call to order the Finance Committee for today, May 27th. If we could get a roll call, please.

Certainly, Madam Chair. Councilor Cassid is excused. I'm sorry. Yes, she is with her son at a medical procedure out of state. Councilor Lindell. Councilor Faulkner excused. She is also excused. Councilor Lee Garcia, here. Councilor Romero. I am here. Madam Chair, you have a quorum.

All right. Do we have any changes to the agenda tonight?

No, Madam Chair. No changes from staff.

All right. If there aren't changes from the committee, is there a motion?

Second.

We have a motion and a second to approve tonight's agenda. All those in favor?

Aye.

Anybody opposed? That motion passes. Approval of the consent agenda. I believe there is one item that has been pulled tonight. I don't know the letter. I know what it is. Maybe you can help me direct.

Certainly, Madam Chair. It is item number six, K as in kangaroo.

Okay, great. Anything else the committee wants to hear? All right. If not, can I get a motion to approve the consent agenda as amended?

Second.

We have a motion and a second to approve the consent agenda as amended. All those in favor?

Aye.

Anybody opposed? That motion passes. We are on then to, let me just make sure, presentations. And we have a Finance Department staff recognition, and I'll turn it over to you, Director Oster.

Thank you so much, Madam Chair. All right. Well, I am delighted to have two staff recognitions this evening, and I just love doing this as part of our agendas. It's so wonderful and rewarding for me to be able to recognize our amazing staff in the Finance Department and introduce them to the Finance Committee.

So, first tonight, we are recognizing Jasmine. Jasmine works in our payroll office, and she makes sure that we get paid every two weeks. So, thank you, Jasmine. We all appreciate that. Jasmine is a skilled payroll and finance professional with strong experience in municipal finance, payroll management, and regulatory compliance. Jasmine is responsible for overseeing payroll processing, reconciliation, and timely reporting, ensuring accuracy and adherence to both internal protocols and federal and state regulations. Jasmine is deeply committed to issue resolution, internal audit accuracy, and continuous process improvement. She actively works to streamline workflows, implement best practices, and maintain current payroll policies and procedures. Demonstrating strong initiative, Jasmine recently undertook the project of scanning all police Excel time cards to create an electronic archive for audit purposes without being asked, which is amazing. Thank you so much, Jasmine. That's just one example of the great initiative that Jasmine shows. She also took it upon herself to organize and clean out the department's filing system. Huge thank you there as well. Many, many years of old paper files in that filing cabinet. And that improved records relating to former employees to make compliance work more efficient. Jasmine is currently pursuing a degree in Human Resources Management at Santa Fe Community College, and she continues to grow her expertise while contributing as a dependable, proactive member of the finance and payroll team. Her work ethic and initiative make her a valuable asset to the department, and we're really excited to recognize her here this evening.

And Jasmine is an employee that came to us initially through a temp agency and then decided to come on board as an employee, and we are so glad. We really appreciate it. As you all know, payroll is a small group, but very, very important. It's a can't-fail function, and we depend on our payroll group of three employees to ensure that all of our city staff, all 1,400 plus of us, get paid timely and accurately every two weeks. And so I am glad to say that I don't wake up at night worrying about payroll because I know that our team has got it. We have an incredible group of very smart and competent employees that take care of business every two weeks and get us paid. And payroll is one of those things that never stops. Happens every two weeks no matter what. There's no off time. There's no slow season. It just keeps coming every two weeks. So with that, I'd like to invite Jasmine to come up to the mic if you'd like and present her with a certificate.

Jasmine, it is my pleasure to present you with this certificate of appreciation. It says, "The following award is given to Jasmine Reyes. This certificate is given to Jasmine Reyes in appreciation for performance, service, and dedication to the City of Santa Fe." Thank you so much, Jasmine.

Thank you, Jasmine. I'd love to hire you to come clean out my paper files. That would be a project. You'd be there for decades. Thank you. And it sounds like that's a really important moment of recognition for you and your initiative and the work that you're doing. I love the phrase "can't-fail function," and that's certainly true. It's like the ocean. The waves just keep coming, and you're there to make sure that we all get paid. So much appreciated. Thank you. And thank you, Director Oster, for taking the time to recognize this important work. Appreciate it. I think you have a second one now, right?

Yes, I do, Madam Chair. And thank you so much, Jasmine, for being here. Next, I am honored to tell you about Anita Medina. And I think a lot of you already know Anita. She's been with the city for a number of years, and she just spent a lot of time with us here in Finance Committee during the budget hearing process. For those that might not know, Anita is our Principal Budget Analyst in the Budget Office. Also a small but mighty group. We have a team of four in the Budget Office that handles all of the budget adjustments and prepares the annual budget. They prepare the interim budgets that we do, the unanticipated revenue, and Anita's special role has to do with personnel budgeting. So, every time that we're looking to fill a position or to increase the pay for a position or to reallocate funds, Anita is the one that makes sure that we have the money to honor those commitments that we're making to our employees.

Anita was born in Santa Fe and attended Santa Fe High School, Votech. After graduating high school, she attended Santa Fe Community College and Highlands University, where she graduated Summa Cum Laude. She started with the City of Santa Fe at the Water Division in 2000. After five years there, she moved to Parking and then to Finance for a few years and then to Airport. She then went to the State Human Services Department and then the New Mexico Department of Finance and Administration, where she worked in the Local Government Division. When the Principal Budget Analyst position opened in the Budget Office, Andy was lucky enough to poach her away from DFA, from the Department of Finance and Administration, and who worked very hard and long hours to get our position organizational listing, our PAC, into shape. Anita is a tremendous asset to the Budget Office and to all of us in Finance. And I'm sad to say that Anita has let us know that she plans to retire in the next couple of months. And so we're all excited for Anita, but also sad for us. So we're, you know, looking forward to celebrating her this summer as we look forward to her retirement. And also I want to mention that Anita is active in the community and serves in a variety of important nonprofit organizations, including helping with the organization of the Special Needs Prom that just happened last weekend. So very, very important member of our city staff community, but also the City of Santa Fe community as well. So with that, I'd love to invite Anita up to the microphone here. Do you have anything you want to add, Anita?

It's bittersweet to leave, but thank you all, and thank you for the budget process going through.

Thank you so much, Anita. Thank you. And it is my pleasure to present this certificate of appreciation to Anita Medina. It says, "The following award is given to Anita Medina. This certificate is given to Anita Medina in appreciation for performance, service, and dedication to the City of Santa Fe." And this is just the beginning of our plans to celebrate Anita over the summer. So, we're happy to kick it off with this, but look for additional celebrations for Anita to express our gratitude for her 25 years of public service in Santa Fe. Thank you so much.

And thank you, Anita, and thank you for all the work during the budget hearings. I know you were here with us every single day for nine days, and I know your work was very important in that whole process and keeping us on track. So, thanks. Thanks a lot for that work. Nine days. I know. Councilor Lindell likes to remember that. All right. Thank you so much. And congratulations to both of you. That's terrific. And congratulations on your retirement. I'm, yeah, I can see how that's bittersweet. So, but congrats. 25 years is a long time. Okay. Director Oster, are we?

I just wanted to thank Jasmine and Anita and their friends and family for being here with us tonight and letting us recognize you. Thank you so much.

Okay, so with that, the item that was pulled tonight is item K. It's a request for approval of Amendment Number Three to Legal Services Agreement Item Number 23-0635 with Brownstein Hyatt Farber Schreck LLP to increase the not-to-exceed amount by $120,000 for the new total amount of $412,160.25, including New Mexico gross receipts tax, for legal services related to the development of the Midtown property. We have with us tonight our City Attorney, Aaron McSherry. We also have Daniel Hernandez, who is the head honcho over at Midtown. And with that, Councilor Lindell, you pulled this item. Did you want them to talk about it or do you just have questions? Okay, I'll then turn it over to you.

Thank you, Chair. Thank you for being here, Ms. McSherry. I'm just curious, why has something different happened on the project that we need to, because this is Amendment Number Three, and how did we come up with what our initial estimate was, and what is happening that makes us have to continue to amend this and increase the amount?

Thank you, Chair Romero Worth, Councilor Lindell. I think we basically have based it on, initially it was how much we had available for budget and what we were doing with Aspect. Well, it was anticipating some sort of a developer for Aspect Studios. And so as we've gone along, it's just dependent on what the needs are for the campus. So now we're about to enter a new phase of dispositions. We've wrapped up the council we've been working with helped us with a lot of the closing documents with NMFA and Aspect Studios most recently. So it just depends on how much work we give them. So basically, I think we've extended the term a couple times in order to have coverage for additional phases of the redevelopment and phases in the non-technical usage. But so initially we used them with Aspect for the disposition agreement. Now we've been working with them, starting to work on the Mata disposition agreement with them. And then they helped us with a lot of the closing documents. So we weren't sure how much it was going to cost to do this, but we put some funding in there for what we had in our budgets, and as needed, we've been working with the firm.

Sure. Chair Romero, Councilor Lindell, I think it just depends on the complexity of the dispositions.

The first disposition was quite complex. So, it just depends on how complex the dispositions are and what the city's needs are. Councilor Meworth, Councilor Lindell, we did try to get this through a little bit earlier, so I'm not sure we'll be able to get enough work done this school year to spend up to the, I think we can definitely spend the $120,000 total. The $60,000 is in my budget for next fiscal year, and the Metropolitan Redevelopment Agency had an available $60,000 for this year. So, we're trying to get as much done as possible. We have a lot of work to give them. It's really just a matter of how fast we can get it done. Any other questions?

Councilor Lee Garcia: Thank you, Madam Chair. Not really on this one, and I know we already approved our consent, but I had seen in our email that item I was also pulled, but that was no longer discussed. Councilor Lindell had pulled it and then decided to wait until when it goes on final passage to discuss it. So, it didn't end up being pulled after all. Okay, thank you. I just wanted that clear.

Chair: Sure. Second. We have a motion and a second to approve item K. Do we need, I guess we need a roll call, right? Yes. Councilor Lindell.

Councilor Lee Garcia: Yes.

Councilor Romero: Yes.

Chair: Motion passes. Great. Thank you. Thank you, City Attorney McSherry and Mr. Hernandez, or maybe I call you Director, Director Hernandez, for being here tonight. Appreciate it. Okay, we are on to matters from staff. I did ask, as part of,

Chair: I'm sorry to interrupt. We have an introduction of what? Oh, thank you so much. Yes, we do. A really important one. Okay, so I need to introduce a resolution 2025 that I am sponsoring. It doesn't have a number yet. A resolution restricting the weight limit on the Sarra Gordo Bridge number 8838 not to exceed a gross weight limit of 15 tons until repairs are made, directing installation of weight limitation signs in advance of the bridge, and notice of this resolution sent to the New Mexico Motor Transportation Department as required by state law, specifying that violation of the weight limit is a misdemeanor punishable by the penalties in NMS 1978 section 66-8-7, and directing notice to the New Mexico Department of Transportation when repair completion and full access to the bridge is restored. And again, this is just for introduction. It'll be at the governing body meeting tomorrow night. So, that is now introduced. Now we can go to matters from staff. And I did ask Director Oster to address the recent issue that the city had with somebody fraudulently getting into our accounts and taking money, redirecting money in a manner that was not appropriate, was not meant for. So, I wanted Director Oster to address that briefly and what's been done. And you may have other things, but just wanted to note that that's something you'll be talking about. So, over to you.

Director Oster: Thank you, Madam Chair. And this is not the kind of update that I would like to be giving you, but it's an important one. And I want to first start by saying that this is something that the city is taking very seriously. The finance department and the IT department have been working pretty much round the clock since this issue was discovered to try to address it. So, just to summarize what happened, a vendor account in our MUN system appears to have been compromised by a bad actor. The account was accessed by someone who made unauthorized changes to one vendor's information. At this point, we're only aware of one vendor who was impacted. The bad actor logged into Munis using that vendor's valid user ID and password, and we don't know how the bad actor obtained that login information at this point. So, but they did log in using a valid user ID and password. The city sent a payment for a valid invoice to the banking information in the vendor account after the unauthorized changes occurred, and then it was discovered that that banking information did not belong to the vendor. So, what happened was this person who was not authorized logged in to the vendor's account, submitted a change to their banking information, and then we processed a valid invoice, and we sent the payment to the information, the banking information in the vendor file, which was what the bad actor had changed. They redirected a valid payment to a bank account that did not belong to the vendor. Unauthorized access to private account information is unfortunately a common form of internet crime, and as I said, the city is taking it very seriously. The incident was reported promptly to the governing body, the FBI Internet Crime Complaint Center, the Santa Fe Police Department, the New Mexico State Auditor, and the fiscal agent bank. The incident was discussed last week with the audit committee and the internal auditors and reported to the city's external auditors. The ITT department and the finance department are taking swift action to implement extra layers of security and identify additional authentication measures to safeguard against unauthorized access to city systems. Business process changes have already been implemented to verify the validity of changes to vendor account information. I'm not going to go into the specifics of that here because we want to ensure that people don't find a way to get around those new controls. But we have implemented additional controls and safeguards. Internet crimes are becoming more and more sophisticated and difficult to protect against. To help safeguard against bad actors, ITT and finance are evaluating new cybersecurity tools and multifactor authentication features that we can add to city systems to make it more difficult for those bad actors to access them. And finally, ITT and finance are working with the fiscal agent bank, the Santa Fe Police Department, and the FBI to investigate the incident and attempt to recover the funds. This is a slow process, and it may take up to 90 days before we have more information, but we are actively working with the law enforcement partners and the fiscal agent bank to try to recover the funds.

Chair: Great. Thank you. And did you have anything else in your report tonight?

Director Oster: No, Madam Chair.

Chair: Okay. So, that's our staff report. We'll go to matters from the committee. All right. Matters from the chair. Our next meeting is Monday, June 9th. And with that, we are adjourned. Thank you, everybody.