Los Lunas schools audit flags overpayments, fraud concerns, violations

Los Lunas Schools is again under a hard spotlight after a special audit found stipend overpayments, evidence suggesting time-and-leave fraud and breakdowns in governance and compliance that could affect how money is spent across one of Valencia County’s largest public institutions.

The Los Lunas Board of Education accepted the 97-page report on Wednesday, May 20, by a 5-0 vote after hearing from New Mexico State Auditor Joseph Maestas, special investigations director Shawn Beck and Audrey Jaramillo of Jaramillo Accounting Group. The audit reviewed district actions from July 1, 2023, through May 1, 2025, and also flagged procurement problems involving legal services and violations tied to the Open Meetings Act.

Maestas said the purpose of the audit was to protect public trust and reinforce accountability in public schools. Even so, the report also credited the district’s core financial staff with strong underlying systems and said only one exception turned up in a large procurement sample, suggesting the biggest failures were concentrated in leadership and oversight rather than throughout every department.

That distinction matters for families in Los Lunas, where the district says it educates more than 8,300 students across 12 surrounding communities. When oversight slips, the effects can reach beyond the boardroom and into classrooms through payroll errors, tighter spending controls, delayed services and weaker confidence that taxpayer dollars are being handled correctly. The district’s finance and operations division says its job is to make sure the system follows board policy and state and federal law.

Board President Frank Otero said the district would take the recommendations seriously and framed the findings as an issue of integrity, compliance and leadership responsibility. The timing adds pressure: on April 28, the board unanimously approved a $144,572,592 budget for the 2026-27 school year, even as enrollment declined and operating costs continued to rise, leaving less room for mistakes that waste money or disrupt staffing.

The audit also lands in a district with a long record of scrutiny. Los Lunas Schools’ website includes a 2020 forensic audit report and responses from both the board and management. In 2021, the New Mexico Public Education Department indefinitely suspended all five board members after audit-related findings, and a 2022 report said former board member Frank Otero was later replaced after that episode. A separate annual audit had already found eight issues, including possible procurement-code, Open Meetings Act, governmental conduct and public records violations.

For taxpayers and parents in Los Lunas, the question now is whether this latest audit becomes a turning point or another chapter in a deeper pattern of weak oversight.