Days of wine and roses: State agencies probe lavish spending by university president

This story was originally published by Searchlight New Mexico.

As two state agencies begin scrutinizing the Western New Mexico University president’s spending on international travel, extravagant purchases and sojourns at five-star resorts, a review of financial records and interviews with current and former employees now suggest those expenses were just the tip of the iceberg.

Joseph Shepard’s spending has also been lavished on costly wine, $111,000 in floral arrangements and more than $123,000 in checks made out to himself in just the last five years.

The new details emerge as Shepard comes under heightened scrutiny for his spending habits and those of his wife, former CIA agent Valerie Plame. On Jan. 5, the New Mexico Higher Education Department issued highly critical preliminary findings following a review of Western’s finances. The move came on the heels of the Office of the State Auditor announcing it would bring in a third-party accountant to audit the school’s books.

Both agencies began looking at Western’s finances after Searchlight New Mexico published an investigation into Shepard’s spending in early December.

Shepard has consistently defended the expenses as critical to the university’s future and its fundraising efforts. He has denied any wrongdoing, saying that he, Plame and top university officials have always abided by university policy.

But as Friday’s letter from Higher Education Department Acting Secretary Patricia Trujillo made clear, several trips and purchases appear to have violated state guidelines and university policies. Among eight sternly worded concerns, Trujillo targeted Shepard’s purchases of high-end furniture.

“During times when the effects of inflation and a tuition increase are affecting students, the university is generating negative media publicity for overly lavish furniture purchases that question the fiduciary integrity of current leadership,” Trujillo wrote. She urged university leaders to consider an end to international travel until they perform a cost-benefit analysis on the last five years’ worth of trips.

Financial records from the nonprofit WNMU Foundation and interviews with current and former employees indicate that previous accounts of Shepard’s spending have likely been gross undercounts. The foundation’s stated mission is to raise funds “for scholarships, capital improvements, programs and other activities” in support of the university. But Searchlight’s review of records shows that in the last five years, Shepard has spent more than $230,000 of the foundation’s donated money on floral arrangements and checks made out to himself.

Shepard and Plame did not directly respond to questions from Searchlight. University Vice President for Compliance and Communications Julie Morales responded to questions on their behalf.

“The university president has a discretionary fund and a flower budget of $80,000 per year of non-taxpayer/non-public funds to support the mission of the university and of the foundation for events and purchases,” Morales wrote in an email. “Over the years, the president has been reimbursed from non-taxpayer funds for his personal expenses that he has made on behalf of the university.” Those reimbursements “are approved by the foundation,” she stated. (Read her full response here.)

Seven employees speak out

In recent years, Shepard has made trips to Zambia and Europe on what he has described as student recruitment efforts. While overseas, employees said, Shepard and Plame reportedly indulged in expensive tastes. In interviews, seven current and former university employees, each with firsthand knowledge of the president’s office, the Board of Regents or the university foundation, described exorbitant purchases and costly renovations to Shepard’s on-campus home, which is owned by the university. The employees spoke on the condition of anonymity, saying they feared they would lose their jobs for speaking to the press.

Three recalled a trip to Greece and Spain, during which Shepard arranged to ship back a trove of imported wine. The employees estimated that the wine cost as much as $800 per bottle and said Shepard ordered so much of it that it could not fit in his house. (According to Morales, the wine was not bought with taxpayer money.)

One of the employees also alleged that the foundation has been relegated to a “presidential piggy bank” and that Shepard and Plame, who bears the title of university first lady, live extravagantly off of donor and taxpayer dollars. While the president’s house has had a number of renovations, including the installation of opulent water features, campus buildings have fallen into disrepair with leaky roofs, bursting pipes and faulty elevators, several employees said.

“It’s what they call ‘the Western way,’” said Brenda Findley, the university’s former vice president of business affairs who in 2023 settled a whistleblower lawsuit against the Board of Regents. In the suit, she alleged “various improprieties with regard to the expenditure of public funds by Dr. Shepard.” Shepard has denied the allegations.

“A person who comes in and sees what’s happening at Western has two courses: One is to say, ‘Oh my god, this is so wrong, we need to fix it,’” Findley told Searchlight. “The other one is to say, ‘Wow, there’s an opportunity here to really rape this system.’”

Harsh questions, low graduation rates

Some New Mexico lawmakers have also begun to call Shepard’s lifestyle into question. At a Legislative Finance Committee hearing last month, Sen. Siah Correa Hemphill, whose district includes Silver City, subjected Shepard to a lengthy line of questioning over the tens of thousands of taxpayer dollars he spent on furniture, international travel and five-star resorts.

“Our job is to ensure there’s no misuse of taxpayer money on behalf of students and their families, especially when they’re experiencing a 3 percent increase in tuition,” Hemphill said at the hearing, where Shepard, as chair of the Council of University Presidents, was requesting nearly $400 million in increased higher education funding across the state.

But Western’s academic stature has come under hard questioning. Its graduation rate — 31 percent, according to the National Center for Education Statistics — trails other New Mexico universities. The rate is 52 percent at the University of New Mexico’s main campus and 51 percent at New Mexico State University’s main campus.

In his response to the Higher Education Department, Shepard did not deny Searchlight’s findings about his spending, travel or the use of university employees to clean his home; regarding concerns about university employees ironing his linens, he wrote, it is “the university’s obligation to maintain the house,” which includes custodial services.

All this spending comes on top of a lucrative compensation package: a $365,000 salary, a $50,000 annual bonus, a $2,000 monthly car allowance and 100 percent-covered healthcare.

“Western New Mexico University has consistently followed the university’s procurement code and travel policy as well as been transparent with its transactions,” Shepard wrote to the Higher Education Department. At December’s legislative hearing, he told lawmakers that the nature of his accommodations varies, adding that he couldn’t recall if one hotel in Zambia even had a concrete floor.

But records show that Shepard and his traveling companions rarely lodged in such modest accommodations. In fact, many trips have exceeded the $215 per diem rates established by state law for out-of-state travel. And in her January letter to Shepard, the Higher Education secretary expressed concern that Western’s regents brought family members along on costly overseas travels.

When reached by phone, Western’s Board of Regents Chair Mary Hotvedt would not comment on the concerns and allegations in the January letter.

According to the university’s internal policies, transactions made on a university purchasing card — essentially a credit card — must not exceed $20,000. But financial records show that Shepard’s nearly $28,000 in purchases at Seret & Sons, the Santa Fe furniture store where he purchased three custom sofas, a side table and a spread of cushions and pillows, was spread out among several transactions, largely over the course of a month and a half in the summer of 2020.

The required purchase approval was not signed until 16 days after the furniture was bought and paid for, the Higher Education Department said in its January letter to Shepard.

The department also said that Plame’s possession of a university credit card appears to be in violation of state procurement card policies. Shepard previously told Searchlight that Plame has a university credit card and can file for reimbursement when using her personal credit card on behalf of the university, “just like any employee would.” He later told Searchlight that Plame was not a university employee.

It remains to be seen what will come of the state’s probes. But as the investigations play out and the 2024 legislative session looms, lawmakers have made it clear that the optics matter.

“Being seen as a poor steward when there are hundreds of millions of new dollars flowing into higher education is a sure way for folks across the state to make a judgment,” Rep. Nathan Small, vice chair of the Legislative Finance Committee, told Shepard at the December hearing. “Why are we investing that much largesse when they don’t see stewardship?”

Joshua Bowling, Searchlight's criminal justice reporter, spent nearly six years covering local government, the environment and other issues at the Arizona Republic. His accountability reporting exposed unsustainable growth, water scarcity, costly forest management and injustice in a historically Black community that was overrun by industrialization. Raised in the Southwest, he graduated from Arizona State University's Walter Cronkite School of Journalism and Mass Communication.

This article originally appeared on Las Cruces Sun-News: State agencies probe lavish spending by university president