How UNM Recouped Neal’s Overpayments

By Daniel Libit

In July 2014, the same month the University of New Mexico gave Craig Neal a $200,000 raise, the university also entered into a “Memorandum of Agreement” with its  basketball coach that stipulated how he would return $123,710.83 he had been inadvertently overpaid.

That agreement, signed by Neal, former UNM Athletic Director Paul Krebs, and David Harris, the school’s executive vice president for administration, adds both a layer of clarification and intrigue to a payroll snafu first uncovered earlier this month.

In a follow-up to our initial reporting, which found that UNM had accidentally overcompensated Neal a six-figure sum over a 12-month span, we requested additional documents to understand how the university ultimately resolved the matter — and confirm whether, in fact, it had been resolved. Responding to our additional public records request, the school provided documents this week, which indicate UNM had zeroed out the debt by the summer of 2015, a year after it was first documented.

The fact that the process of recouping the payments was memorialized in a formal legal document, signed by top UNM officials, demonstrates how severe of a screw-up this was understood to be. It also arouses curiosity on how this obligation jived with the pay raise Neal was awarded contemporaneously; UNM has thur far insisted that the two were entirely unrelated.

In addition to the MOA, the documents we received include two letters sent by UNM’s payroll department to Neal on June 11, 2014, in which the school determined that it had overpaid the coach by $140,503.25 from April 2013 through March 2014. It described this error as being “due to a miscalculation of your salary.”

The documents do not indicate how the error was initially discovered and UNM has repeatedly declined our efforts to bring this to light. A university spokesperson declined to respond Monday to requests for comment. Neal has previously declined to answer our questions related to this matter.

Neal signed one of the payroll department documents on July 7, 2014, in which he agreed not to seek a refund from the Social Security Administration for taxes withheld on the overpaid amounts for the previous year. As for the overpayments that occurred in 2014, UNM allowed Neal to pay $17,803.16 of the $33,038.25, the full difference owed to the school for that year, if he did so by that December 31. The school apparently recouped the remainder by adjusting Neal’s 2014 tax withholdings.

On July 11, 2014, Neal signed the MOA, which authorized the school to withhold a minimum of $10,309.23 from his monthly paycheck through June 30, 2015. UNM has now provided to Neal’s pay stubs from that time, each of which show a Payroll Accounts Receivable line item for the aforementioned amount. In a previous release of Neal’s pay stubs we obtained, those figure had been redacted.

The repayment agreement also included language about what would happen in the event Neal left UNM without having reconciled the full debt. Around that time, Neal was reportedly being pursued by the University of South Florida, a courtship that was thought to be the driving reason for why the Lobos opted to boost his pay prior to his second season as head coach. Krebs had previously dismissed the idea that a raise was necessary, telling the Albuquerque Journal that March, “We felt that contract was very fair when it was signed.”

UNM waited almost a month after it had renegotiated Neal’s contract to make this public, later explaining that it didn’t want the news of the pay raise to take fan attention away from the start of the Lobo football season. But in light of these overpayment revelations, it stands to reason UNM had other reasons why it didn’t want to draw attention to the matter. And for quite some time, it appeared, it had dutifully kept it confined to a very tight circle.

Although the MOA is written between Neal and UNM’s Board of Regents, it bears no signature of any regent. Besides Neal, Krebs and Harris, Emma Rodriguez, an associate university counsel who handles faculty and staff employment, is the only other signatory. A knowledgable source said that at least several of the regents were entirely unaware of this payment mishap until’s report this month. The UNM spokesperson on Monday was specifically asked whether the Bords of Regents had been made aware of the issue, but did not respond.

In the broader context of the Athletic Department’s recent history, the overpayments saga seems all the more galling — and telling. In addition to Neal, current Lobo baseball coach Ray Birmingham was also accidentally overpaid $40,000, the school confirmed to earlier this month. UNM told KRQE this month that it discovered the Birmingham pay error in March 2015, just as Neal’s overpayments were nearing resolution. A UNM spokesman had previously told us that Birmingham’s debt should be resolved by the end of this month. We cannot independently confirm this, and Birmingham has declined our requests for comment.

UNM’s accounting issues are by now the official preoccupations of both the New Mexico state Auditor and Attorney General, who have both announced investigations into the way money is being spent and received by the school’s Athletic Department. has learned that the overpayments will be one of the many matters Tim Keller, the state auditor, is looking to probe. Citing such distractions, Krebs announced on June 2 that he would be retiring from his job at month’s end.

(Featured photo by Devika/Flickr)