Whitesburg KY

KACo’s disgrace

The lavish and self-indulgent spending uncovered by state Auditor Crit Luallen in her review of the books of the Kentucky Association of Counties is breathtaking.

Studying a three-year period, Ms. Luallen and her office discovered that KACo board members and staff managers billed the organization for $219,145 in restaurant charges, $48,426 for Christmas dinners, more than $43,000 for alcoholic beverages and even $890 for an escort service and strip clubs. And that might not be the whole story. Alcohol charges, for example, likely were really higher, since some expense vouchers didn’t provide specific documentation.

Of nearly $2 million charged to KACo credit cards during the three-year period, Ms. Luallen said, about $1.4 million was excessive, lacked adequate documentation or failed to establish a valid business purpose.

Ms. Luallen attributed these abuses to KACo’s “self-serving culture” and to “weak policies and inadequate board oversight.”

That’s doubtless true, but KACo’s extravagance reflects more than simply lax management. Like other recent scandals at the Kentucky League of Cities and Lexington’s airport authority, the KACo spending signals a view that its funds — public money raised mostly from taxpayers in member counties — are “play” accounts, available for officials’ use. It’s a mindset that is as cynical as it is venal.

There was condemnation of such practices last summer from the General Assembly and the Governor’s Office. However, the ability of officials in Frankfort to regulate public, non-profit associations such as KACo and the KLC is probably very limited as a legal matter. Change will have to be self-administered.

To that end, there does seem to be some good news at KACo. Ms. Luallen said that the cooperation her staff received from Christian County Attorney Mike Foster, the current KACo president, and the organization’s board is an indication that the group will adopt the more than 150 recommendations the auditor’s office made. Moreover, Ms. Luallen found th at K ACo generally does a good job in providing services and savings to counties. That should spur county officials to help steer KACo back on track.

There seem to be few avenues to punish those who plundered KACo’s accounts. Although Ms. Luallen is sending her report to the IRS, the state attorney general’s staff told her that the abuses lack elements required for felony prosecutions. Meanwhile, former KACo executive director Bob Arnold, who resigned in September and who figures in much of the questionable spending, will draw his $178,000 salary through next June. The reason is that his contract allows full payment even if “acts of dishonesty” occurred.

Removing that outrageous provision from future contracts would be a good start on the road to reform.

— The Courier-Journal, Louisville

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