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OFFICE OF 

INSPECTOR GENERAL 

U.S. DEPARTMENT OF THE INTERIOR 

AUDIT

U.S. Fish and Wildlife Service Grants 

Awarded to the State of New Mexico, 

Department of Game and Fish, From 

July 1, 2016, Through June 30, 2018, 

Under the Wildlife and Sport Fish 

Restoration Program

In recognition of Secretarial Order No. 3380, we are providing estimated costs 

associated with certain work products. Applying a formula involving prior salary 

and benefit expenses, we estimate the cost of preparing this report to be 

$118,000.

Report No.: 2019-CR-045 December 2020

This is a revised version of the report prepared for public release.
 

 

 

 

 

 

 

 

 

OFFICE OF 

INSPECTOR GENERAL 

U.S. DEPARTMENT OF THE INTERIOR 

Memorandum 

To: Aurelia Skipwith 

Director, U.S. Fish and Wildlife Service 

From: Amy Billings 

Regional Manager, Central Region 

Subject: Final Audit Report – U.S. Fish and Wildlife Service Grants Awarded to the State 

of New Mexico, Department of Game and Fish, From July 1, 2016, Through June 

30, 2018, Under the Wildlife and Sport Fish Restoration Program 

Report No. 2019-CR-045 

This report presents the results of our audit of costs claimed by the New Mexico 

Department of Game and Fish (Department) under grants awarded by the U.S. Fish and Wildlife 

Service (FWS) through the Wildlife and Sport Fish Restoration Program. We conducted this 

audit to determine whether the Department used grant funds and State hunting and fishing 

license revenue for allowable fish and wildlife activities and complied with applicable laws and 

regulations, FWS guidelines, and grant agreements. The audit period included claims totaling 

$94 million on 85 grants that were open during the State fiscal years that ended June 30, 2017, 

and June 30, 2018. 

We found that the State generally ensured that grant funds and State hunting and fishing 

license revenue were used for allowable fish and wildlife activities and complied with applicable 

laws and regulations, FWS guidelines, and grant agreements. We noted, however, issues with 

unsupported other direct costs, ineligible out-of-period costs, and many other areas. We 

questioned costs totaling $51,715 ($38,786 Federal share) as ineligible and $388,018 ($291,014 

Federal share) as unsupported. We question excess reimbursement in the amount of $32,788 as 

ineligible due to unreported program income. We also determined the Department failed to 

follow regulations to eliminate free and duplicate license holders, resulting in inaccurate license 

certification data. In addition, the Department did not have policies for subawards and it failed to 

follow regulations for the acquisition of real property. 

We provided a draft of this report to the FWS. The FWS concurred with all 21 

recommendations and will work with the Department to implement corrective actions. The full 

responses from the Department and the FWS are included in Appendix 4. In this report, we 

summarize the Department’s and FWS Region 7’s responses to our recommendations, as well as 

our comments on their responses. We also modified our report as appropriate based on their 

responses. We list the status of the recommendations in Appendix 5. 

Office of Audits, Inspections, and Evaluations | Lakewood, CO 
Please provide us with the corrective action plan based on our recommendations by 

March 29, 2021. The plan should provide information on actions taken or planned to address 

each recommendation, as well as target dates and titles of the officials responsible for

implementation. Please send your response to aie_reports@doioig.gov. 

If you have any questions regarding this report, please contact me at 303-236-9243. 

The legislation creating the Office of Inspector General requires that we report to

Congress semiannually on all audit reports issued, actions taken to implement our 

recommendations, and recommendations that have not been implemented. 

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Contents 

Introduction......................................................................................................................................1 

Objective ....................................................................................................................................1 

Background................................................................................................................................1 

Results of Audit ...............................................................................................................................2 

Questioned Costs—$362,588 (Federal Share)...........................................................................2 

Control Deficiencies ..................................................................................................................9 

Recommendations Summary .........................................................................................................14 

Appendix 1: Scope and Methodology............................................................................................23 

Appendix 2: Sites Visited ..............................................................................................................26 

Appendix 3: Monetary Impact.......................................................................................................27 

Appendix 4: Response to Draft Report..........................................................................................29 

Appendix 5: Status of Recommendations......................................................................................34 
 

 

 

 

 

 

 

 

 

 

 

 

Introduction 

Objective 

In June 2016, we entered into an intra-agency agreement with the U.S. Fish and Wildlife Service 

(FWS) to conduct audits of State agencies receiving grant funds under the Wildlife and Sport 

Fish Restoration Program. These audits fulfill the FWS’ statutory responsibility to audit State 

agencies’ use of these grant funds. 

We conducted this audit to determine whether the New Mexico Department of Game and Fish 

(Department) used grant funds and State hunting and fishing license revenue for allowable fish 

and wildlife activities and complied with applicable laws and regulations, FWS guidelines, and 

grant agreements. See Appendix 1 for details about our scope and methodology. See Appendix 2 

for sites we visited. 

Background 

The U.S. Fish and Wildlife Service (FWS) provides grants to States1 through its Wildlife and 

Sport Fish Restoration Program (WSFR) for the conservation, restoration, and management of 

wildlife and sport fish resources. WSFR was established by the Pittman-Robertson Wildlife 

Restoration Act and the Dingell-Johnson Sport Fish Restoration Act.2 The Acts and related 

Federal regulations allow the FWS to reimburse grantees a portion of eligible costs incurred 

under WSFR grants—up to 75 percent for States up to 100 percent for and the District of 

Columbia Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, and the Northern 

Mariana Islands. The reimbursement amount is called the Federal share. The Acts require that 

hunting and fishing license revenue be used only for the administration of State fish and wildlife 

agencies. In addition, Federal regulations require States to account for any income earned from 

grant-funded activities and to spend this income before requesting grant reimbursements. 

1 The Wildlife and Sport Fish Restoration Program defines the term “State” to include the District of Columbia, the 

Commonwealth of Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, and the Commonwealth of the Northern 

Mariana Islands. 

2 Formally known, respectively, as the Federal Aid in Wildlife Restoration Act, 16 U.S.C. § 669, as amended, and the Federal 

Aid in Sport Fish Restoration Act, 16 U.S.C. § 777, as amended. 

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Results of Audit 

We determined that the State generally ensured that grant funds and State hunting and fishing 

license revenue were used for allowable fish and wildlife activities and complied with applicable 

laws and regulations, FWS guidelines, and grant agreements. We noted, however, issues with 

unsupported other direct costs, ineligible out-of-period costs, and many other areas. 

We found the following: 

• Questioned Costs. We questioned $51,715 ($38,786 Federal share) as ineligible and 

$388,018 ($291,014 Federal share) as unsupported. We also questioned $32,788 of 

excessive drawdown as ineligible (see Figure 1). These questioned costs arose due to 

unsupported other direct costs, out-of-period costs, inadequate equipment management, 

unreported program income, and unsupported payroll charges. 

• Control Deficiencies. We found opportunities to improve internal controls in license 

certifications and to follow policies on subawards and real property. 

Figure 1: Summary of Ineligible and Unsupported Costs 

Ineligible Unsupported 

Issue Costs ($) Costs ($) Total ($) 

Other direct costs – 169,966 169,966 

Out-of-period costs 38,786 – 38,786 

Equipment management – 120,585 120,585 

Unreported program income 32,788 – 32,788 

Payroll charges – 463 463 

Totals $71,574 $291,014 $362,588 

See Appendix 3 for a statement of monetary impact. 

Questioned Costs—$362,588 (Federal Share) 

Unsupported Other Direct Costs—Questioned Costs of $169,966 

During our review of other direct costs, we identified two invoices with unsupported 

documentation. To be eligible for reimbursement under WSFR, grant expenses must be 

reasonable, allowable, allocable, and adequately supported. The Department was unable to 

provide support in the amount of $226,621 ($169,966 Federal share) for expenditures to a 

university. The first invoice covered a 6-month period for expenditures, disbursements, and cash 

receipts in the amount of $30,236. The second invoice was for salary and wages, fringe benefits, 

travel, supplies, services, and F&A costs in the amount of $196,385. The Department could not 

provide specific timesheets, travel vouchers, or receipts for supplies or services rendered to 

support the expenses claimed. 

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According to 2 C.F.R. § 200.403(a), costs must be necessary and reasonable in order to be 

allowable for the award. In addition, 2 C.F.R. § 200.403(g) requires that costs be adequately 

supported to be allowable. The New Mexico Manual of Model Accounting Practices requires 

supporting invoices and documentation for all expenses for goods and services. Therefore, 

Department personnel are not following Federal and State policies and procedures requiring 

personnel to obtain proper documentation to support costs claimed. As a result of the 

unsupported costs, we are questioning $226,621 ($169,966 Federal share). Without adequate 

documentation, the FWS cannot determine if costs are reasonable and necessary to achieve the 

intended purpose. 

Recommendations 

We recommend that the FWS: 

1. Resolve the unsupported other direct costs of $169,966 (Federal share)

2. Require the Department to follow Federal and State policies and procedures that

require personnel to obtain proper documentation to support all claimed costs

Ineligible Out-of-Period Costs—Questioned Costs of $38,786 

On 5 of the 35 WSFR grants we reviewed, the Department charged labor, services, and supplies 

that were incurred outside the grant’s period of performance totaling $51,715 ($38,786 Federal 

share) (see Figure 2). 

Figure 2: Questioned Costs Related to Out-of-Period Costs 

Ineligible Costs ($) 

Grant Grant Title (Federal Share) 

F12AF00739 Fisheries Monitoring 338 

F16AF00126 Bird Conservation 22,169 

F16AF00178 Hatchery O&M 10,648 

F16AF00191 Fisheries Administration 1,569 

F16AF00192 Warmwater Hatchery Evaluation 4,062 

Total $38,786 

According to Federal regulations: 

• A non-Federal entity may only charge allowable costs incurred during the period of

performance to the Federal award (2 C.F.R. § 200.309)

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• A non-Federal entity must liquidate all obligations incurred under the Federal award no

later than 90 days after the end date of the period of performance (2 C.F.R. § 200.343(b))

• In order to be allowable, costs must be necessary, reasonable, and adequately

documented (2 C.F.R. § 200.403(a)(g))

• Transactions for goods and services must be completed during the period of performance

(31 U.S.C. § 1501(a)(l)(B))

The Department did not follow established policies and procedures to ensure that costs charged 

to WSFR grants were allowable and within the period of performance. As a result, the 

Department incorrectly charged $51,715 ($38,786 Federal share) for expenditures incurred 

outside of the WSFR grant period of performance. 

Observation Regarding Out-of-Period Costs 

In response to our draft report, the Department said that the questioned costs were “received after 

grant closed,” “not charged to grant,” or “used as no-federal match.” These statements were 

written on Invoice Nos. 0596 and 96230 and included in the support provided with the 

Department’s response to our draft report. If an expenditure is charged to a grant in error, then a 

journal voucher needs to be processed in a timely manner to remove the expenditure from the 

grant. In addition, the financial management system must provide for accurate, current, and 

complete disclosure of the financial results of each Federal award. 

Recommendations 

We recommend that the FWS: 

3. Resolve the questioned costs related to out-of-period costs totaling $38,786

(Federal share)

4. Require the Department to implement policies and procedures to ensure that

costs charged to WSFR grants are allowable for the performance of the grant

and are incurred during the period of performance

Unsupported Equipment Management—Questioned Costs of $120,585 

Based on our review, the Department did not maintain accurate and complete equipment 

inventory records. We selected a sample of 82 property items identified in Department’s 

inventory data. We found issues with all 82 items in our sample selection. Specifically, we 

found: 

• One item with an incorrect asset tag number

• One item with an incorrect location

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• Two asset tags were listed three times (see example in Figure 3)

• Two instances in which staff told us that equipment was located at a different site, but we

found the equipment on the auction list

• Eleven items missing asset tags (we found the asset tags in the manager’s office)

• Nine missing items—employees stated these items went to auction; however, the items

were not on the auction list

• The acquisition date was missing for all 82 property items

Figure 3: Questioned Costs Related to Equipment Management 

Property Unsupported Costs 

Item Description Funding Source Tag No. ($) (Federal Share) 

SST vault toilet FW-26-DL-1 000505 94,406 

SST vault toilet F-55-0-6 000505 13,859 

SST vault toilet F-55-D-6 000505 12,320 

2010 International 

cab & chassis 4400 F-66-M-8 2 004918 -

2010 International 

cab & chassis 4400 None 004918 -

2010 International 

cab & chassis 4400 F-66-M-14 004918 -

Total $120,585 

Note: Costs not questioned on items with Property Tag No. 004918 

Federal regulations require that each State follow its own policies and procedures for the use, 

management, and control of its equipment. Specifically, 50 C.F.R. § 80.90(f) states that State 

fish and wildlife agencies are responsible for assets acquired under program grants to ensure that 

they serve the intended purpose throughout their useful life. According to 2 C.F.R. § 

200.313(D)(1), property records must include a description of the property, identification 

number, the source of funding (including the Federal Award Identification Number), acquisition 

date, cost of the property, and the location. Further, 50 C.F.R. § 80.10 requires that all revenue 

from hunting and fishing licenses be used only for administration of the State fish and wildlife 

agency. 

We reviewed the State’s property inventory data to test compliance with Federal and State 

requirements and to ensure that controls exist over items purchased with WSFR funds or license 

revenue. State policy requires agencies to mark or tag each capital asset. It also requires agencies 

to perform a physical inventory of capital assets to ensure they are adequately safeguarded and 

accurately reported. 

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Grant No. 

F16AF00960 

Grant Title 

WMA O&M 

Type of Program Income 

Land rental/tower leases 

Ineligible Costs ($) 

10,802 

F16AF00960 WMA O&M Land rental/tower leases 10,487 

F16AF00960 WMA O&M Land rental/tower leases 3,415 

F18AF00171 Hatchery O&M Fish food 4,037* 

F17AF00173 Hatchery O&M Fish food 3,184* 

F18AF00171 Hatchery O&M Fish food 863 

Total $32,788 

*Amounts donated for scholarships .

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Department personnel did not follow State policies and procedures that require inventory 

safeguarding and reporting. As a result, the Department is at risk of losing control over 

equipment, and the FWS cannot ensure that equipment purchased with WSFR funds and license 

revenue were used for the intended purpose. 

Recommendations 

We recommend that the FWS: 

5. Resolve the questioned costs related to equipment management totaling

$120,585 (Federal share)

6. Require the Department to follow Federal and State asset management

policies and procedures for reporting and safeguarding of equipment

7. Ensure all assets are marked or tagged

8. Ensure that the Department’s official inventory records are updated and

accurately reflect the current location of the asset

Ineligible Drawdowns Due to Unreported Program Income—Questioned Costs 

of $32,788 

We found that during State fiscal years (SFYs) 2017 and 2018, the Department failed to report a 

total of $32,788 (all Federal) in program income for revenue generated from land rental/tower 

leases and fish food sold to the public from vending machines. 

The FWS approved the Department’s use of the deductive method to account for revenue earned 

under its fish hatchery and wildlife management area (WMA) operation and maintenance 

(O&M) grants (see Figure 4). The Department collected revenue from the hatchery vending 

machines and from crops, hay sales, and land rental/tower leases at the WMA. As a result of the 

unreported program income, we question $32,788 in excessive drawdown as ineligible. 

Figure 4: Questioned Costs Related to Unreported Program Income 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal regulations (50 C.F.R. § 80.120) define program income as gross income a grantee 

receives that is directly generated by a grant-supported activity or earned as a result of the grant 

agreement during the grant period. In accordance with 50 C.F.R. § 80.123(b)(1)(i) and (ii), the 

agency must deduct the program income from total allowable costs to determine the net 

allowable costs. Program income must be used for current costs unless the Federal agency 

authorizes otherwise. Additionally, 2 C.F.R. § 200.305(b)(5) states that grantees must disburse 

program income before requesting additional cash payments. 

A Department official stated it did not have written policies or procedures for the management of 

program income. When the Department receives a program income deposit slip, the current 

process includes preparing a journal voucher entry to apply program income to the appropriate 

grant. During SFYs 2017 and 2018, Department staff did not report tower lease deposits totaling 

$24,704 and underreported fish food vending machine income of $863 because it did not receive 

deposit slips. 

Further, in SFYs 2017 and 2018, the Department did not report $7,221 in program income from 

a fish food vending machine purchased with grant funds because it donated the program income 

to two university scholarship funds. The Department policy for State hatchery fish food vending 

machines requires managers to give a portion of the funds to two designated university 

scholarships. State employees confirmed that a portion of the revenue from the fish food vending 

machines was donated to two university scholarship funds each year. 

Written policies and procedures for identifying and reporting program income will help the 

Department and the FWS ensure appropriate reporting and accounting of program income. 

Because the Department did not deduct program income from the total costs it claimed under 

Grant Nos. F16AF00178, F17AF00173, F18AF00171, and F16AF00960, it received excess 

reimbursements from the FWS. 

Recommendations 

We recommend that the FWS: 

9. Resolve the questioned costs in unreported program income of $32,788

10.Require the Department to develop written policies and procedures for the

management, control, and reporting of program income

Unsupported Payroll Charges—Questioned Costs of $463 

The Department uses the Statewide Human Resources Accounting and Financial Management 

Reporting System (SHARE) and the Federal Aid Cost Tracking System (FACTS) for 

timekeeping. We sampled 30 timesheets, with labor costs totaling $52,807, and found 6 of the 

FACTS timesheets did not reconcile to the time entries in SHARE. This resulted in a 20 percent 

error rate totaling $617 ($463 Federal share) of questioned payroll charges. Specifically, we 

found: 

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• One employee recorded 5.5 extra hours worked in SHARE but recorded 8.5 extra hours

worked in FACTS

• Five employees recorded regular hours in SHARE that did not reconcile to FACTS

• Six employees recorded fewer total hours in SHARE than in FACTS

SHARE is a centralized human resources system for time reporting, payroll, and job data. 

FACTS is a secondary time entry system that allows employees to enter the grant number and 

note their activities so the State can determine the eligibility of hours charged to each grant. The 

Department imports information from FACTS into SHARE in the form of a journal entry for use 

in the reimbursement process. As such, the hours listed in FACTS should mirror the time entries 

in SHARE. 

According to Federal regulations: 

• In order to be allowable, costs must be necessary and reasonable for the performance of

and allocable to the Federal award (2 C.F.R. § 200.403(a)).

• The reasonableness of a given cost depends on whether it is deemed ordinary and

necessary for the operation of the non-Federal entity or the performance of the Federal

award (2 C.F.R. § 200.404(a)).

• A cost is allocable to a Federal award if the goods or services can be charged to the award

in accordance with the relative benefits received (2 C.F.R. § 200.405(a)).

• Federal awards for salaries and wages must be based on records that accurately reflect the

work performed (2 C.F.R. § 200.430(i)(1)). These records must support the distribution

of the employee’s salary among specific activities if the employee works on multiple

awards (2 C.F.R. § 200.430 (i)(1)(vii)).

While employees record their time in FACTS, supervisors approve time in SHARE. Neither the 

FACTS training manual nor the SHARE Time Approval Policy require approving officials to 

reconcile time entries in FACTS to the SHARE system prior to approving employee timesheets. 

The Department needs policies and procedures to ensure that payroll data in SHARE reconciles 

with the payroll data in FACTS. Without these policies and procedures, grants could be charged 

more than allowable for payroll expenses. 

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Recommendations 

We recommend that the FWS: 

11.Resolve the questioned costs related to payroll charges totaling $463 (Federal

share)

12.Require the Department to implement policies and procedures to ensure that

the payroll data in SHARE reconciles with the payroll data in FACTS each pay

period

Control Deficiencies 

The Department Overstated Paid License Holders 

The Department did not remove all duplicate licenses, free licenses, and unreliable license data 

from its count, overstating its paid license holders. The Department overstated its 2016 and 2017 

paid license holders count by 21,470 and 23,665, respectively (see Figure 5). 

Figure 5: Overstated Paid License Holders 

Potential Free Unreliable Total 

Type Duplicates Licenses License Data Overstated 

2016 Total 92 17,902 3,476 21,470 

Hunting 12 0 119 131 

Fishing 80 17,902 3,357 21,339 

2017 Total 116 19,878 3,671 23,665 

Hunting 7 0 156 163 

Fishing 109 19,878 3,515 23,502 

Note: License years end on March 31. 

According to 50 C.F.R. § 80.30, States are required to certify annually the number of paid 

hunting and fishing license holders because the FWS uses this data to apportion funds for the 

WSFR programs among the States. In addition, 50 C.F.R. § 80.31(a)(2) and (b)(3) require State 

fish and wildlife agencies to certify the number of people who have paid licenses to fish and 

requires them to eliminate duplicates. 

The Department overstated the amount of license holders because it did not know that it needed 

to remove all free licenses during the certification process. The Department’s standard operating 

procedure for license certification did not require duplicate and free license holders be 

eliminated. Department officials told us that they manually removed some duplicate license 

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holders by cross referencing names with dates of birth and the last four digits of a social security 

number. However, we identified an additional 208 duplicates. 

A Department official stated the automated licensing system assigns a unique identifier to each 

purchaser of a license, which is used to determine when a licensee has purchased more than one 

hunting or fishing license. However, the system does not have controls in place to prevent 

someone from entering a month or address in the name field or all zeros for the last four digits of 

the social security number. This is a data reliability issue and the Department cannot ensure that 

all duplicate licenses were removed. We found 3,476 licenses with unreliable data for 2016, and 

3,671 licenses for 2017. 

By not eliminating free and duplicate fishing and hunting licenses, the Department reported a 

higher number of license certifications that may have resulted in a larger apportionment of 

WSFR funds. 

Recommendations 

We recommend that the FWS: 

13.Require the Department to resolve the inaccurate license certifications and

effects on apportionment, if any

14.Require the Department to include directions to remove free and duplicate

licenses in its current standard operating procedures and to finalize the policy

and procedures

15.Require the Department to put controls in place in the licensing system to

prevent invalid information from being entered into the fields or to continue to

exclude the unreliable data in their certifications

The Department Did Not Properly Identify a University as a Subrecipient 

The Department did not correctly identify an agreement with the New Mexico State University 

as a subaward. We found that the agreement was for an annual contribution the Department paid 

under Grant No. F16AF00992. 

State fish and wildlife agencies determine whether an agreement categorizes the recipient of the 

funds as a subrecipient or a contractor (2 C.F.R. § 200.330). According to 2 C.F.R. § 200.330(a), 

a subaward is “for the purpose of carrying out a portion of a Federal award and creates a Federal 

Assistance relationship with the subrecipient.” Every subaward agreement must contain 13 

specific items, including the date of the original Federal award, a description of the Federal 

award project, the subrecipient’s approved indirect cost rate, and other information (2 C.F.R. § 

200.331(a)). 

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As the pass-through entity, the Department evaluates the risk of noncompliance with Federal 

statutes, regulations, and the terms and conditions of the subaward to determine the appropriate 

subrecipient monitoring (2 C.F.R. § 200.331 (b)). This evaluation may consider factors such as 

(1) the subrecipient’s prior experience with the same or similar subawards, (2) the results of

previous audits of the subrecipient, (3) whether the subrecipient has new personnel or systems,

and (4) the extent and results of the Federal awarding agency’s monitoring of the subrecipient.

Regarding subaward reporting requirements, 2 C.F.R. § 170, Appendix A, Paragraphs I.a.1 and 

I.a.2.i state that Federal grantees must report each subaward action that obligates $25,000 or

more in Federal funds at www.fsrs.gov. This information is then posted on

www.USASpending.gov.

Finally, concerning support for payroll costs, 2 C.F.R. § 200.430(h)(8)(i)(1), states that charges 

for salaries and wages must be based on records (i.e., timesheets) that accurately reflect the work 

performed. It also states that an internal control system should provide “reasonable assurance 

that charges are accurate, allowable, and properly allocated.” 

The Department reported that it did not have any subawards during the audit period of July 1, 

2016, to June 30, 2018. During our review of other direct costs, however, we identified an 

invoice covering a 6-month period for an annual contribution to a university and an invoice for 

salaries and wages, fringe benefits, travel, supplies, services, and F&A costs. The Department 

was unable to provide supporting documentation for these expenditures. 

These types of expenses are explicit for carrying out a portion of a Federal award and create a 

subrecipient relationship. We determined that the agreement should have been classified as a 

subrecipient and the Department should have followed regulations pertaining to subrecipient 

agreements. The Department stated in a memorandum to the university that the annual 

contributions will be for continuing unit operations and will provide it with “resources to 

continue management-driven research, technical assistance, and the advancement of 

understanding of fish and wildlife resources in the state of New Mexico.” In addition, the 

memorandum stated that it was a cost reimbursable award. 

The Department did not have a formal policy to determine whether an agreement is a contract or 

a subaward. As a result, the Department entered into a contract agreement with the New Mexico 

State University, which should have been identified as a subaward. The Department told us that a 

subrecipient versus contractor determination checklist was approved last year, and the 

Department started using the checklist on July 1, 2019 (SFY 2020). 

Further, the Department did not have policies and procedures to ensure that subrecipients 

charging labor costs maintained adequate timesheets and reported subawards for posting on 

www.USASpending.gov. 

Because the Department did not determine whether an agreement was a subrecipient or a 

contractor relationship, we cannot ensure that Federal funds were used in accordance with 

regulations, and it puts Federal funds at risk of misuse. In addition, the Department did not 

comply with regulatory requirements for subaward administration under 2 C.F.R § 200.331, 

specifically, monitoring subrecipients and including all federally required elements into the 

agreements. 

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Recommendations 

We recommend that the FWS: 

16.Require the Department to develop and implement formal policies and

procedures to determine whether Federal funds pass-through as subawards or

contracts

17.Require the Department to ensure that all federally required elements are

included in the Department’s subaward agreements

18.Require the Department to train new departmental subaward managers on

oversight techniques and applicable Federal requirements

19.Require the Department to evaluate each subrecipient’s risk of noncompliance

with Federal statutes, regulations, and the terms and conditions of the

subaward for purpose of determining the appropriate subrecipient monitoring

20.Require the Department to educate subrecipients on their responsibilities

under Federal awards

The Department Did Not Follow Grant Award Conditions for the Acquisition of 

Real Property 

The Department did not follow the terms and conditions outlined in Grant No. F17AF00162, 

“Retherford Tract Addition Acquisition.” The Department acquired property for $122,450 using 

Federal grant funds without providing the proper appraisal documentation and without receiving 

a final written approval from the FWS, as outlined in Condition 7 of the grant award letter. In 

addition, the Department did not include a required statement on the deed that “the grantee will 

include a covenant in the recording instrument acquired in whole or in part with Federal 

assistance funds to assure nondiscrimination during the useful life of the project,” as outlined by 

Condition 14 of the grant award. 

The Department is responsible for complying with all requirements of the Federal award (2 

C.F.R. § 200.300(b)). In addition, 2 C.F.R. § 200.303(b) stipulates that the Department must

comply with the terms and conditions of the Federal award. Further, 2 C.F.R. § 200.316 defines

the property trust relationship between the Federal awarding agency and the non-Federal entity.

Specifically, the non-Federal entity must indicate that real property was acquired or improved

with a Federal award and that use and disposition conditions apply to the property.

The Department did not follow the requirements as outlined in the State policy or the grant 

award letter. The Department closed the sale on the property prior to receiving final written 

approval from the FWS for the land acquisition and did not include required language as outlined 

in Condition 14. These issues occurred because the individual responsible for real property 

acquisitions was a new State employee and was not aware of the Federal requirements. 

We issued a Notice of Potential Finding and Recommendation to the Department on this issue. 

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The Department agreed with the finding and worked with the FWS to rectify the issue and 

provided a copy of the amended deed. Based on the Department’s and FWS’ responses, we 

consider the recommendation to amend the deed, to include a covenant statement as outlined in 

Condition 14 of the grant award, as resolved and implemented. 

The FWS worked with the Department to rectify the issue outlined in Condition 7 and the FWS 

retroactively provided approval of the appraisal documentation. The deed to the acquired 

property does not include a covenant in the recording instrument as outlined in Condition 14, still 

violating Federal grant award conditions. 

Recommendation 

We recommend that the FWS: 

21.Work with the Department to amend the deed to include a covenant statement

as outlined in Condition 14 of the grant award

13 
 

 

 

 

 

 

 

 

Recommendations Summary 

We recommend that the FWS: 

1. Resolve the unsupported other direct costs of $169,966 (Federal share) 

Department Response 

The Department did not concur with the finding and recommendation. The costs in this 

category related to two invoices without backup documentation. The Department 

believed the documentation submitted in March 2020 should have resolved the finding. 

FWS Response 

The FWS concurred with our finding and recommendation. It will work with the 

Department to develop a corrective action plan. 

OIG Comment 

Based on the FWS’ response, we consider the recommendation resolved but not 

implemented. We reviewed the support provided by the Department in March 2020, and 

the additional support provided with the response. The RA-SPA-EEC Effort Reports and 

the Grant Agreement letters that identified yearly obligated costs did not resolve the 

finding. Federal and State policies require supporting invoices and documentation for all 

expenses for goods and services. Copies of certified timesheets and invoices for each 

expenditure are needed to resolve the finding. 

2. Require the Department to follow Federal and State policies and procedures that require 

personnel to obtain proper documentation to support all claimed costs 

Department Response 

The Department concurred with the finding and recommendation. The Department will 

strengthen policies and procedures to ensure expenditures charged to grant programs are 

eligible and allowable. The revised procedures will include requirements for proper 

backup documentation. The Department said it intends to implement these policies and 

procedures by January 1, 2021. 

FWS Response 

The FWS concurred with our finding and recommendation. It will work with the 

Department to develop a corrective action plan. 

OIG Comment 

Based on the Department’s and the FWS’ responses, we consider the recommendation 

resolved but not implemented. 

3. Resolve the questioned costs related to out-of-period costs totaling $38,786 (Federal 

share) 

14 
 

 

 

 

 

 

 

Department Response 

The Department did not concur with the finding and recommendation. The Department 

stated that it submitted all documentation to prove that these expenditures, in the amount 

of $162,739, were incurred during the period of performance (previously submitted to us 

in February 2020). For Grant Nos. F12AF00739 ($338) and F16AF00126 (partial amount 

of $14,588.32), the Department said grant numbers were inadvertently entered on the 

purchase orders. According to the Department, the expenses were not charged against the 

grant or used as non-Federal match for the grant, and as such, the costs were covered 

solely by the Department. 

FWS Response 

The FWS concurred with our finding and recommendation. It will work with the 

Department to develop a corrective action plan. 

OIG Comment 

Based on the FWS’ response, we consider the recommendation resolved but not 

implemented. We reviewed the invoices and payroll support provided and determined it 

is sufficient to resolve the questioned costs on Grant No. F16AF00797 in the amount of 

$172,778 ($129,584 Federal share). However, the support did not resolve the remaining 

questioned costs of $38,786 (Federal share). These expenditures were charged to the 

grant in error and a journal voucher needs to be processed to correct the amount reported 

in the financial system for the grant. 

4. Require the Department to implement policies and procedures to ensure that costs

charged to WSFR grants are allowable for the performance of the grant and are incurred

during the period of performance

Department Response

The Department did not concur with the finding and recommendation. However, in the

response to the draft report, the Department stated it will review and update its auditing

policies and procedures to ensure specific directions for period of performance are

included. This update will be completed by January 1, 2021.

FWS Response

The FWS concurred with our finding and recommendation. It will work with the

Department to develop a corrective action plan.

OIG Comment

Based on the Department’s and the FWS’ responses, we consider the recommendation

resolved but not implemented.

5. Resolve the questioned costs related to equipment management totaling $120,585

(Federal share)

15 
 

 

 

 

 

Department Response 

The Department concurred with the finding and recommendation. The purchase was for 

24 vault toilets that were installed at various wildlife and fishing areas throughout the 

State in 1993. The toilets have reached the end of their useful life and should have been 

removed from the inventory. In the future, the Department said it will ensure better 

tracking through updated software. 

FWS Response 

The FWS concurred with our finding and recommendation. It will work with the 

Department to develop a corrective action plan. 

OIG Comment 

Based on the Department’s and the FWS’ responses, we consider the recommendation 

resolved but not implemented. 

6. Require the Department to follow Federal and State asset management policies and

procedures for reporting and safeguarding of equipment

Department Response

The Department concurred with the finding and recommendation. The Department will

continue to review and make necessary revisions to policies and procedures for the

capital asset process and will ensure that staff is knowledgeable and trained on this

process.

FWS Response

The FWS concurred with our finding and recommendation. It will work with the

Department to develop a corrective action plan.

OIG Comment

Based on the Department’s and the FWS’ responses, we consider the recommendation

resolved but not implemented.

7. Ensure all assets are marked or tagged

Department Response

The Department concurred with the finding and recommendation. The Department has

taken actions to address the inventory issues we identified and intends to correct

shortcomings in the tracking of capital assets.

FWS Response

The FWS concurred with our finding and recommendation. It will work with the

Department to develop a corrective action plan.

OIG Comment

Based on the Department’s and the FWS’ responses, we consider the recommendation

resolved but not implemented.

16 
 

 

8. Ensure that the Department’s official inventory records are updated and accurately reflect

the current location of the asset

Department Response

The Department concurred with the finding and recommendation and agreed that

additional work is necessary in these areas. The Department is performing data recovery

within the asset software. The system needs to be replaced with a new inventory software

system. According to the Department, these efforts will allow it to ensure assets are

appropriately safeguarded and properly recorded in its financial records.

FWS Response

The FWS concurred with our finding and recommendation. It will work with the

Department to develop a corrective action plan.

OIG Comment

Based on the Department’s and the FWS’ responses, we consider the recommendation

resolved but not implemented.

9. Resolve the questioned costs in unreported program income of $32,788

Department Response

The Department concurred with the finding and recommendation. The Department is

implementing procedures and accounting controls within each division and in the

Administrative Services Division (ASD) to properly record program income and ensure

that it has been properly recognized on the SF-425 report. Because of the new processes

implemented, the Department is confident that program income will no longer be

unreported as in previous fiscal years.

The Department resolved $24,591 of the questioned costs by not taking the total eligible

reimbursement drawdown in January 2020. The remaining $8,197 will be resolved when

the next draw occurs, per discussions with the FWS.

FWS Response

The FWS concurred with our finding and recommendation. It will work with the

Department to develop a corrective action plan.

OIG Comment

Based on the Department’s and the FWS’ responses, we consider the recommendation

resolved but not implemented.

10. Require the Department to develop written policies and procedures for the management,

control, and reporting of program income

Department Response

The Department concurred with the finding and recommendation. The Federal Aid

Coordinator created written policies and procedures for implementation of controls

within each division and in ASD. This document outlines the steps needed to accept and

17 
 

 

 

 

 

 

 

 

 

 

 

 

deposit program income and ensure that it has been properly recognized on the SF-425 

report. The draft policies and procedures are currently being reviewed. Once finalized, 

the document will be distributed to all divisions. 

FWS Response 

The FWS concurred with our finding and recommendation. It will work with the 

Department to develop a corrective action plan. 

OIG Comment 

Based on the Department’s and the FWS’ responses, we consider the recommendation 

resolved but not implemented. 

11. Resolve the questioned costs related to payroll charges totaling $463 (Federal share)

Department Response

The Department did not concur with the finding and recommendation. The Department

believed that the documentation they provided in March 2020 validated the payroll

charges in question, with the exception of one entry, totaling $139.73 in Federal funding.

According to the Department, the documentation provided explained the difference in

reporting based on compensation time earned between the two payroll systems (SHARE

and FACTS).

FWS Response

The FWS concurred with our finding and recommendation. It will work with the

Department to develop a corrective action plan.

OIG Comment

Based on the FWS’ responses, we consider the recommendation resolved but not

implemented. We reviewed the documentation attached to the draft report response and it

is the same information we reviewed in March 2020. The supporting documentation

provided did not resolve the finding. According to Department staff, compensation time

earned should not be recorded in FACTS until it is taken. Also, the number of regular

hours recorded in SHARE did not match the number of regular hours in FACTS.

12. Require the Department to implement policies and procedures to ensure that the payroll

data in SHARE reconciles with the payroll data in FACTS each pay period

Department Response

The Department did not concur with the finding and recommendation. However, in its

response to the draft report, the Department stated it will remind supervisors responsible

for verifying and approving time to ensure that entries in SHARE and in FACTS are

reconciled. The reconciliation is mandatory and it will now be reinforced that supervisors

must compare the time entries in both systems to ensure that they reconcile prior to

approving an employee’s time. Notifications will be sent out with the payroll reminders

on a biweekly basis.

18 
 

 

 

 

 

 

FWS Response 

The FWS concurred with our finding and recommendation. It will work with the 

Department to develop a corrective action plan. 

OIG Comment 

Based on the FWS’ response, we consider the recommendation resolved but not 

implemented. 

13. Require the Department to resolve the inaccurate license certifications and effects on 

apportionment, if any 

Department Response 

The Department concurred with the finding and recommendation. The inaccurate license 

certifications will be amended, utilizing new queries and reports, to achieve a true 

calculation. In addition, the Department emailed the FWS and requested guidance related 

to this recommendation. The Federal Aid Coordinator will provide the FWS headquarters 

and the regional offices with the new license certificate report by December 31, 2020, to 

correct the identified issue. 

FWS Response 

The FWS concurred with our finding and recommendation. It will work with the 

Department to develop a corrective action plan. 

OIG Comment 

Based on the Department’s and the FWS’ responses, we consider the recommendation 

resolved but not implemented. 

14. Require the Department to include directions to remove free and duplicate licenses in its 

current standard operating procedures and to finalize the policy and procedures 

Department Response 

The Department concurred with the finding and recommendation. The Federal Aid 

Coordinator revised the manual to outline the removal of free and duplicate licenses. The 

revised manual added two additional queries to be used in the calculation of hunters and 

fishermen by creating two new reports outlining the individual account holder receiving 

free fishing and/or hunting licenses (70+ and Military Active Veterans). The Information 

Technology Division also added two more customer identification numbers to Phases 1 

and 2, providing additional data to cross reference duplicates. Veterans and seniors who 

purchase a license will be included in the license certification numbers. 

FWS Response 

The FWS concurred with our finding and recommendation. It will work with the 

Department to develop a corrective action plan. 

OIG Comment 

Based on the Department’s and the FWS’ responses, we consider the recommendation 

resolved but not implemented. 

19 
 

 

 

 

 

15. Require the Department to put controls in place in the licensing system to prevent invalid

information from being entered into the fields or to continue to exclude the unreliable

data in their certifications

Department Response

The Department concurred with the finding and recommendation. The Department is

working with the licensing section to place additional controls in the licensing system to

exclude invalid and unreliable data.

FWS Response

The FWS concurred with our finding and recommendation. It will work with the

Department to develop a corrective action plan.

OIG Comment

Based on the Department’s and the FWS’ responses, we consider the recommendation

resolved but not implemented.

16. Require the Department to develop and implement formal policies and procedures to

determine whether Federal funds pass-through as subawards or contracts

Department Response

The Department concurred with the finding and recommendation. The Department

established policies and procedures and is currently working to formalize them. The

target date for implementation is June 30, 2021.

FWS Response

The FWS concurred with our finding and recommendation. It will work with the

Department to develop a corrective action plan.

OIG Comment

Based on the Department’s and the FWS’ responses, we consider the recommendation

resolved but not implemented.

17. Require the Department to ensure that all federally required elements are included in the

Department’s subaward agreements

Department Response

The Department concurred with the finding and recommendation. Due to the uncertainty

in this process, the Department will request formal training from the FWS. The

Department intends to develop and implement formal policies and procedures for

subawards by June 30, 2021.

FWS Response

The FWS concurred with our finding and recommendation. It will work with the

Department to develop a corrective action plan.

20 
 

 

 

OIG Comment 

Based on the Department’s and the FWS’ responses, we consider the recommendation 

resolved but not implemented. 

18. Require the Department to train new departmental subaward managers on oversight

techniques and applicable Federal requirements

Department Response

The Department concurred with the finding and recommendation. The Department will

also request formal training from the FWS on contracts and subawards, as there continues

to be confusion about this process. The Department agreed that subrecipients may not

have been correctly identified during the audit period. The Department implemented

procedures and developed training to properly identify subrecipients. The Department

intends to develop and implement formal subaward policies and procedures by June 30,

2021.

FWS Response

The FWS concurred with our finding and recommendation. It will work with the

Department to develop a corrective action plan.

OIG Comment

Based on the Department’s and the FWS’ responses, we consider the recommendation

resolved but not implemented.

19. Require the Department to evaluate each subrecipient’s risk of noncompliance with

Federal statutes, regulations, and the terms and conditions of the subaward for purpose of

determining the appropriate subrecipient monitoring

Department Response

The Department concurred with the finding and recommendation. Due to the uncertainty

in this process, the Department will request formal training from the FWS. The

Department intends to develop and implement formal subaward policies and procedures

by June 30, 2021.

FWS Response

The FWS concurred with our finding and recommendation. It will work with the

Department to develop a corrective action plan.

OIG Comment

Based on the Department’s and the FWS’ responses, we consider the recommendation

resolved but not implemented.

20. Require the Department to educate subrecipients on their responsibilities under Federal

awards

21 
 

 

 

Department Response 

The Department concurred with the finding and recommendation. Due to the uncertainty 

in this process, the Department will request formal training from the FWS. The 

Department intends to develop and implement subaward formal policies and procedures 

by June 30, 2021. 

FWS Response 

The FWS concurred with our finding and recommendation. It will work with the 

Department to develop a corrective action plan. 

OIG Comment 

Based on the Department’s and the FWS’ responses, we consider the recommendation 

resolved but not implemented. 

21. Work with the Department to amend the deed to include a covenant statement as outlined

in Condition 14 of the grant award

Department Response

The Department concurred with the finding and recommendation. The Department

amended the deed to attach the covenant and add the deed restriction.

FWS Response

The FWS concurred with our finding and recommendation. It will work with the

Department to develop a corrective action plan.

OIG Comment

Based on the Department’s and the FWS’ responses, we consider the recommendation

resolved and implemented.

22 
 

Appendix 1: Scope and Methodology 

Scope 

We audited the New Mexico Department of Game and Fish’s (Department’s) use of grants 

awarded by the U.S. Fish and Wildlife Service (FWS) under the Wildlife and Sport Fish 

Restoration Program (WSFR). The audit period included claims totaling $94 million on 85 grants 

that were open during the State fiscal years (SFYs) that ended June 30, 2017, and June 30, 2018. 

Methodology 

We conducted this audit in accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain sufficient, appropriate 

evidence to provide a reasonable basis for our findings and conclusions based on our audit 

objective. We believe that the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objective. 

We assessed whether internal control was significant to the audit objective. We determined that 

the Department’s control activities and the following principles were significant to the audit 

objectives. 

• Management should design control activities to achieve objectives and respond to risks

• Management should design the entity’s information system and related control activities

to achieve objectives and respond to risks

• Management should implement control activities through policies

We tested the operation and reliability of internal control over activities related to our audit 

objective. Our tests and procedures included: 

• Examining the evidence that supports selected expenditures charged to the grants by the

Department

• Reviewing transactions related to purchases, direct costs, drawdowns of reimbursements,

in-kind contributions, and program income

• Interviewing Department employees

• Inspecting equipment and other property

• Determining whether the Department used hunting and fishing license revenue for the

administration of fish and wildlife program activities

23 
 

 

 

 

 

 

 

• Determining whether the State passed required legislation assenting to the provisions of

the Pittman-Robertson Wildlife Restoration Act and the Dingell-Johnson Sport Fish

Restoration Act

• Evaluating State policies and procedures for assessing risk and monitoring subawards

• Visiting sites throughout the State (see Appendix 2 for a list of sites visited)

We found deficiencies in internal control resulting in our eight findings of unsupported other 

direct costs, out-of-period costs, equipment management, unreported program income, payroll 

charges, license certification, subawards, and real property. 

Based on the results of our initial assessments, we assigned a level of risk and selected a 

judgmental sample of transactions for testing. We used auditor judgement and considered risk 

levels relative to other audit work performed to determine the degree of testing performed in 

each area. Our sample selections were not generated using statistical sampling, and therefore we 

did not project the results of our tests to the total population of transactions. 

This audit supplements, but does not replace, the audits required by the Single Audit Act 

Amendments of 1996. Single audit reports address controls over Statewide financial reporting, 

with emphasis on major programs. Our report focuses on the administration of the New Mexico 

fish and wildlife agency, and that agency’s management of WSFR resources and license revenue. 

New Mexico provided computer-generated data from its official accounting system and from 

informal management information and reporting systems. We tested the data by sampling 

expenditures and verifying them against WSFR reports and source documents such as purchase 

orders, invoices, and payroll documentation. While we assessed the accuracy of the transactions 

tested, we did not assess the reliability of the accounting system as a whole. 

Prior Audit Coverage 

OIG Audit Reports 

We reviewed our last two audits of costs claimed by the Department on WSFR grants.3 We 

followed up on nine recommendations from these reports and found that all recommendations 

were considered implemented and closed at the final report. 

State Audit Reports 

We reviewed the single audit reports for SFYs 2017 and 2018 to identify control deficiencies or 

other reportable conditions that affect WSFR. In those reports, the Schedule of Expenditures of 

Federal Awards indicated $45.8 million (combined) in Federal expenditures related to WSFR, 

3 U.S. Fish and Wildlife Service Wildlife and Sport Fish Restoration Program Grants Awarded to the State of New Mexico, 

Department of Game and Fish, From July 1, 2011, Through June 30, 2013 (R-GR-FWS-0012-2014), dated September 2015. 

U.S. Fish and Wildlife Service Wildlife and Sport Fish Restoration Program Grants Awarded to the State of New Mexico, 

Department of Game and Fish, From July 1, 2005, Through June 30, 2007 (R-GR-FWS-0011-2008), dated March 2009. 

24 
 

 

and did include findings directly related to WSFR, which was not deemed a major program for 

Statewide audit purposes. The single audit report for SFY 2018 noted a significant deficiency in 

internal control over compliance, and we considered this as a risk indicator when we prepared 

our audit procedures and tests. 

25 
Appendix 2: Sites Visited 

Headquarters Santa Fe 

Area Office Raton 

Lisboa Springs 

Fish Hatcheries Red River 

Rock Lake 

Clayton Lake Dams Eagle Nest 

Colin Neblett 

Wildlife Management Areas McAllister Lake 

Tucumcari Lake 

Shooting Range S.M. Bush

26 
 

 

 

 

Questioned Costs ($) 

(Federal Share) 

Grant No. 

F16AF00992 

Grant Title Cost Category Ineligible Unsupported 

Big Game Survey Other Direct 

Costs – 169,966

F12AF00739 Fisheries Monitoring Out-of-Period 

Costs 338 – 

F16AF00126 Bird Conservation Out-of-Period 

Costs 22,169 – 

F16AF00178 Hatchery O&M Out-of-Period 

Costs 10,648 – 

F16AF00191 Fisheries 

Administration 

Out-of-Period 

Costs 1,569 – 

F16AF00192 Warmwater Hatchery 

Evaluation 

Out-of-Period 

Costs 4,062 – 

FW-26-DL-1 

F-55-O-6

F-55-D-06

PR/DJ 

Boating Access 

Boating Access 

Equipment 

Management 

Equipment 

Management 

Equipment 

Management 

– 94,406

– 13,859

– 12,320

F16AF00960 WMA O&M Unreported 

Program Income 10,802* – 

F16AF00960 WMA O&M Unreported 

Program Income 10,487* – 

F16AF00960 WMA O&M Unreported 

Program Income 3,415* – 

F18AF00171 Hatchery O&M Unreported 

Program Income 4,037* – 

F17AF00173 Hatchery O&M Unreported 

Program Income 3,184* – 

Appendix 3: Monetary Impact 

The audit period included claims totaling $94 million on 85 grants that were open during the 

State fiscal years that ended June 30, 2017, and June 30, 2018. We questioned $51,715 ($38,786 

Federal share) as ineligible and $388,018 ($291,014 Federal share) as unsupported. We also 

questioned $32,788 in excessive drawdown as ineligible due to unreported program income from 

the New Mexico Department of Game and Fish. 

Monetary Impact: Questioned Costs 

27 
Questioned Costs ($) 

(Federal Share) 

Grant No. Grant Title Cost Category Ineligible Unsupported 

F18AF00171 Hatchery O&M Unreported 

Program Income 863* – 

F18AF00171 Hatchery O&M Payroll – 54

F16AF00960 WMA O&M Payroll – 233

F18AF00131 Fisheries Management Payroll – 144

F17AF00680 Ecosystem Analysis Payroll – 32

Total $71,574 $291,014 

 

 

*The unreported program income resulted in an excessive drawdown (all Federal).

Wildlife management area (WMA) 

Operations & maintenance (O&M) 

Pittman-Robertson and Dingell-Johnson (PR/DJ) 

28 
 

 

Appendix 4: Response to Draft Report 

The U.S. Fish and Wildlife Service’s response to our draft report follows on page 30. The New 

Mexico Department of Game and Fish’s response to our draft report follows on page 31. 

29 
 

 

United States Department of the Interior 

FISH AND WILDLIFE SERVICE 

P.O. Box 1306 

Albuquerque, New Mexico 87103 

In Reply Refer To: September 9, 2020 

FWS/R2/RD-WSFR 

Memorandum 

To: Amy Billings 

Regional Manager, Central Region 

From: Cliff Schleusner 

Regional Manager, Wildlife and Sport Fish Restoration Program 

Subject: Draft Audit Report Comments - U.S. Fish and Wildlife Service, Wildlife and Sport 

Fish Restoration Program Grants Awarded to the State of New Mexico, New 

Mexico Department of Game and Fish, from July 1, 2016, through June 30, 2018 

Report No. 2019-CR-045 

Attached are the State of New Mexico, New Mexico Department of Game and Fish’s 

(Department) comments and additional supporting documentation for the Office of Inspector 

General’s Draft Audit Report No. 2019-CR-045. The Service concurs with the auditor’s draft 

findings and recommendations and has reviewed the Department’s response. 

We will work closely with the Department’s staff in developing and implementing a corrective 

action plan that will resolve all of the finding and recommendations. 

If additional information is required, please contact Cheryl Rodriguez, Grants Fiscal Officer, at 

505-248-7464. 

Attachments 

30
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GOVERNOR

Michelle Lujan Grisham

DIRECTOR AND SECRETARY

TO THE COMMISSION

Michael B. Sloane

STATE OF NEW MEXICO

DEPARTMENT OF GAME & FISH

One Wildlife Way, Santa Fe, NM 87507

Post Office Box 25112, Santa Fe, NM 87504

Tel: (505) 476-8000 | Fax: (505) 476-8123

For information call: (888) 248-6866

www.wildlife.state.nm.us

STATE GAME COMMISSION

SHARON SALAZAR HICKEY

Chair

Santa Fe

ROBERTA SALAZAR-HENRY

Vice-Chair

Las Cruces

JIMMY RAY BATES, SR.

Albuquerque

GAIL CRAMER

Mayhill

TIRZIO J. LOPEZ

Cebolla

DAVID SOULES

Las Cruces

JEREMY VESBACH

Placitas

September 4, 2020

Mr. Cliff Schleusner

Regional Manager

Wildlife and Sport Fish Restoration

Southwest Region

Box 1306

Albuquerque, NM 87103

Dear Mr. Schleusner:

The purpose of this letter is to address the Draft Audit Report from the Office of the

Inspector General (OIG) on the “U.S. Fish and Wildlife Service Grants Awarded to the

State of New Mexico, Department of Game and Fish, from July 1, 2016 through June

30, 2018, Under the Wildlife and Sport Fish Restoration Program (Audit No. 2019-CR045).” Included in the letter is the response from New Mexico Department of Game and

Fish to the eight specific findings and recommendations from the Draft Audit Report

from OIG.

The New Mexico Department of Game and Fish does not support the implementation of

a Corrective Action Plan (CAP) because all findings have been addressed and are

currently in the process of correction. Therefore, the Department does not believe that

further action is needed.

Below are the following responses to findings included in the Draft Audit Report from the

Office of the Inspector General:

Unsupported Other Costs

The costs in this category related to two invoices without backup documentation. The

documentation in question was submitted during the course of the audit (March 2020)

and should have resolved this issue. The Department is in the process of reviewing and

strengthening the procedures to ensure that all backup documentation is received. This

revision will be implemented by January 1, 2021.

31
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cliff Schleusner

September 4, 2020

Page -2-

Ineligible Out-of-Period Costs

In response to ineligible out-of-period costs, the Department submitted all

documentation prove that these expenditures were, in fact, incurred during the period of

performance. This documentation was submitted during the course of the audit

(February 2020). The majority of these questioned expenses were paid in January 2017

utilizing grants that ended in December 2016. Invoices were not received until after the

end of the grant period but the goods/services were obtained during the grant period.

The Department will review, and update as necessary, the auditing policies and

procedures no later than January 1, 2021.

Unsupported Equipment Management

The Department is currently recovering all data within the asset software system

following a crash. The Department is also in the process of investigating the purchase of

a new software system for additional reliability and accountability. The questioned costs

related to equipment management are for items purchased in 1993 that have reached

the end of their useful life and should no longer be on the inventory. In addition, the

Department will ensure that staff is trained on the equipment management system and

that the policies and procedures are followed.

Unreported Program Income

In response to unreported program income on the SF-425 report, the Department is

implementing procedures and accounting controls within each division and in ASD to

properly record program income and ensure that it has been properly recognized on the

SF-425 report. Because of the new processes implemented, the Department is

confident that program income will no longer be unreported as in previous fiscal years.

A policies and procedures manual has been drafted and is currently under review. The

majority of the overdrawn amount was corrected with our January 2020 draw. The

remainder will be paid back with the July draw. In addition, the Department will no

longer donate proceeds from the fish food vending machines to scholarship funds. The

Department believes that the omission of the program income information was a clerical

error and not an error of commission.

Specifically, for all revenue received that is program income, each deposit of that

revenue is reviewed and verified by the Federal Grant Auditor and approved by the

Federal Aid Coordinator, and if necessary the Chief Financial Officer to ensure

accountability of program income. If it is determined that the deposit qualifies as

program income, it is deducted from the grant expenditures prior to requests for

reimbursement and reported as program income on the proper forms (SF-425). This

includes income recorded for fish food sales, hay harvesting at wildlife management

areas and other grant-supported activities.

32
Cliff Schleusner 

September 4, 2020 

Page -3-

Unsupported Payroll Charges 

The Department submitted backup documentation validating the payroll charges in 

question in March 2020. This documentation explained the difference in reporting based 

on comp time earned between the two payroll systems (SHARE and FACTS). It will now 

be reinforced that supervisors must compare the time entries in both systems to ensure 

that they reconcile prior to approval of an employee's time. Notifications will be sent out 

with the payroll reminders on a bi-weekly basis. 

Overstated Paid License Holders 

In reference to the overstated paid license holders, the Department has rerun all data 

from the questioned years. The new reports will be submitted by December 31 , 2020. 

The procedure manual has been updated to clarify instruction regarding the free 

licenses to ensure that they are no longer included. New reports have been created and 

generated by the Information Technology Division to identify free licenses. The division 

is now working with the Licensing Section to place additional controls in the licensing 

system to exclude invalid and unreliable data. 

Improper Identification of Subrecipients 

The Department has established policies and procedures and is currently working on 

formalizing these. The target date for implementation is June 30, 2021. All project 

managers will be trained in this area. The Department will also be requesting formal 

training in regards to contracts/subawards as there continues to be confusion regarding 

this process. 

Not Following Award Conditions for Acquisition of Real Property 

In reference to acquisition of real property, the Department has amended the deed, 

attaching the covenant and adding the deed restriction. All documents were submitted 

to OIG in February 2020. This recommendation has been resolved and implemented. 

The New Mexico Game and Fish Department appreciates the support and work of the 

U.S. Fish and Wildlife Service and looks forward to working together in the future to 

support conservation and wildlife. If you have any additional questions or concerns, 

please do not hesitate to contact me at Thank you . 

Respectfully, Digitally signed by Michael B. Michael B. Sloane 

Date: 2020.09.02 13:25:55 Sloane -06'00' 

Michael B. Sloane 

Director 

33 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

21 

Appendix 5: Status of Recommendations 

Recommendation Status Action Required 

Resolved and implemented No action is required. 

1 - 20 

Resolved but not 

implemented: 

U.S. Fish and Wildlife Service 

(FWS) regional officials 

concurred with these 

recommendations and will 

work with staff from the New 

Mexico Department of Game 

and Fish to develop and 

implement a corrective 

action plan. 

Complete a corrective action 

plan that includes information 

on actions taken or planned to 

address the recommendations, 

target dates and titles of the 

officials responsible for 

implementation, and 

verification that FWS 

headquarters officials reviewed 

and approved the actions the 

State has taken or planned. 

We will refer the 

recommendations not 

implemented at the end of 90 

days (after March 29, 2021) 

to the Assistant Secretary for 

Policy, Management and 

Budget to track 

implementation. 

34 
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