Fourth NNMC whistle-blower case settled for $100,000

State reveals agreement details as school appeals $475K award in earlier suit


A former employee of Northern New Mexico College who sued the school in 2015, accusing it of misspending federal funds and firing her for raising concerns about the issue, settled the case out of court a year ago for $100,000, according to a state document released this week under a public records request.

Patricia Perea's deal with the state Risk Management Division is part of $640,000 in settlements that Northern and the state agency have agreed to pay three former college employees who brought similar state District Court whistle-blower suits against the school - an institution wracked in recent years by a series of financial troubles, legal problems and administrative turmoil.

Details of Perea's settlement come as a fourth whistle-blower case against Northern heads to the New Mexico Court of Appeals.

Melissa Velasquez, a former Northern instructor and director of the school's now-shuttered El Rito campus, received a jury award of $475,000 in May following a four-day District Court trial.

Christopher Moody, an attorney for Perea, Velasquez and James Biggs, who settled a case against the school for $295,000, said in an interview Friday that the college is appealing the award in Velasquez's case. His client also has filed an appeal, he said, because she disagrees with the court's decision, following the verdict, to grant a motion by the college to reduce the award amount.

Velasquez would have received more than $600,000, Moody said. But the court lessened the amount at Northern's request.

Moody is optimistic, he said, about the outlook of the case in the appeals court. "We think the college's appeal is without merit," he said. "... And we expect reinstatement of the award."

Northern President Rick Bailey could not be reached to comment on Perea's settlement or the school's appeal in Velasquez's case.

Bailey took office in October 2016 -- before any of the whistle-blower lawsuits were filed -- with a mandate for change. His predecessor, Nancy "Rusty" Barceló, left in December 2015 following several years of controversy and financial struggles. The college was still feeling the effects of her tumultuous tenure throughout 2017.

In April, then-State Auditor Tim Keller said the college had the "worst higher-ed institution audit in the state." His office cited the school for 90 violations, including dozens of unapproved absences for Barceló, totaling $87,000 in expenses.

The State Auditor's Officer in March announced the embezzlement of $200,000 from the school's business office. A high-level employee who resigned at the time is suspected in the theft.

Velasquez, appointed director of Northern's El Rito campus in 2011, said in her complaint that she had uncovered misuse of U.S. Education Department grant funding there, and that when she told a top finance official about the problems, he threatened to close down the campus and eliminate her position.

The college did close its historic El Rito campus in 2015 as part of a series of cuts to address a financial crisis, but Velasquez had been reassigned long before then to the main campus in Española. In June 2014, her complaint said, she was fired.

Perea, hired by the school in 2013 to coordinate its federally funded summer-bridge program, which offers support to Hispanic students, made similar claims in her lawsuit. While the program grant was about $80,000, the lawsuit said, she was given a budget of only $17,000 to run it: an amount that forced activity cuts and didn't cover stipends that had been promised to participants.

Some of the grant funding, the complaint said, had been used to purchase "new shirts for the basketball team, computers, services at Ojo Caliente hot springs and pink iPad covers"--a violation of the federal award.

Perea went on to uncover misuse of other federal grants, the complaint said, and although she alerted administrators about the problems, they refused to take action. Instead, they terminated her employment.

Wyndham Kemsley, a spokesman for the state General Services Department who released Perea's agreement earlier this week, said responsibility for paying the $100,000 to her is split between the college and the Risk Management Division.

In December 2016, the division and the school agreed to Biggs' settlement, as well as a $245,000 settlement with Angelo Jacques. Both former Northern employees also had claimed they faced retaliation for raising concerns about spending practices.

Biggs, now an assistant professor of forestry at New Mexico Highlands University, told The New Mexican in an interview last year that after covering his legal expenses in the case, his nearly $300,000 payout would leave him just about breaking even.

"But the fact that almost all of the people who were there who were responsible were fired or have been forced to leave," he said, "... does provide me with some satisfaction."

Contact Cynthia Miller at 505-986-3095 or cmiller@sfnewmexican­.com.