State auditor will take close look at KLC, KACo

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ED REINKE

July 1, 2009

By RONNIE ELLIS The Commonwealth Journal Wed Jul 01, 2009, 08:30 PM EDT

FRANKFORT, Ky. – State Auditor Crit Luallen announced Wednesday her office will audit the Kentucky League of Cities (KLC) and the Kentucky Association of Counties (KACo) in the aftermath of a series of stories questioning the organizations’ spending policies in the Lexington Herald-Leader.

The Herald-Leader reported that officials of KACo spent nearly $600,000 on travel and entertainment. The paper previously reported KLC spent more than $300,000 for such expenses while Executive Director Sylvia Lovely made in excess of $300,000 a year and the organization spent thousands of dollars to entertain at a restaurant owned by Lovely’s husband. She and Bob Arnold, Executive Director of KACo, were also provided automobiles and often took spouses on trips.

Both organizations are funded indirectly with tax dollars – through dues and insurance premiums of member counties and cities. They are governed by boards made of county officials in the case of KACo and city officials at KLC.

That, Luallen said in letters to board presidents Mike Foster of KACo and Richmond Mayor Connie Lawson of KLC, provides her office with the authority to investigate the spending of the two organizations. She said each “receives public taxpayer funds from dues, insurance premiums, interest on loans and other sources” paid by member cities and counties. She also noted that KACo was audited by then state Auditor Ben Chandler in 1993.

“In these tough economic times, it’s more important than ever that these two agencies, which are funded by the public and governed by elected officials, have full transparency and thorough scrutiny,” Luallen said.

She said her decision was prompted by the news accounts in the Herald-Leader and “specific concerns brought to my office.” She said the auditor has a responsibility to Kentucky citizens to “ensure accountability for their tax dollars.”

Luallen previously sent both organizations recommendations to help with oversight of the agencies, but said Wednesday that individual audits will help address concerns and questions raised about their operation.

“It’s clear by the examples of extravagant spending and lack of transparency that these agencies and their boards need the necessary tools to fulfill their responsibilities to the taxpayers,” Luallen said.

Ronnie Ellis writes for CNHI News Service and is based in Frankfort, Ky. He may be contacted by email at rellis@cnhi.com.

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