Library's legal spending under fire

CRITICS SAY STAFF COULD HAVE DONE MUCH OF WORK

jcheves@herald-leader.comOctober 6, 2009 

Private lawyers billed the Lexington Public Library about $210,000 this year as it faced scrutiny over its spending from the Herald-Leader, city auditors and its own board of trustees.

The law firm Stites & Harbison charged the library to respond to the newspaper's Open Records Act requests, answer a reporter's questions, review documents taken by city auditors and interview the library's staff about spending, among other tasks, according to billing records.

In April, the Herald-Leader detailed more than $134,000 in spending by then-chief executive Kathleen Imhoff on travel, meals, gifts and other items over five years, with little oversight. Most of the library's $15 million annual budget comes from Fayette County property taxes.

The library board fired Imhoff in July, shortly after Mayor Jim Newberry removed the board's chairman and vice chairman. A city audit of library spending is expected to be released soon.

On Monday, critics said they were surprised by the size of the legal bills and suggested the library board should have handled most of the duties it assigned to lawyers. One such critic, State Auditor Crit Luallen, noted that the library is now dealing with a 2.6 percent budget cut.

"The library in the last few weeks cut its services, and this is $210,000 that could have been spent on those services," Luallen said. "It's another example of how a lack of oversight can have far-reaching implications."

In hindsight, library board chairman Larry Smith said, he regrets that so much money must be paid to lawyers. But at the time, Smith said, it seemed wise to have "a third party" assist with investigations of library officials' spending, rather than ask the officials being scrutinized to handle the matter. Smith was on the board at the time, but he was not chairman.

During most of the Herald-Leader's reporting, Imhoff and the board referred basic questions about library operations and requests for financial documents to attorneys at Stites & Harbison, who then billed the library. The law firm also copied the library's documents for the newspaper.

The firm billed the library about $90,000 overall for working with the newspaper. Its monthly invoices do not show how many lawyers were involved or what they billed per hour.

The firm charged about $35,000 for its work with city auditors and about $66,000 to help the library board conduct its own internal audit that raised "some oversight issues," Smith said, declining to elaborate. About $17,000 was charged for "general matters" related to the newspaper and city investigations.

"We wanted to keep it all separate, but we really didn't think it would get to the level that it did," Smith said. "I would have preferred — and I'm sure the board would have preferred — that it wasn't this much money."

Jon Fleischaker, general counsel for the Kentucky Press Association, said he has never seen a government entity spend so much money on lawyers simply responding to Open Records Act requests.

It's common for a government official to check with a lawyer about what documents must be released and what can be redacted, but the Lexington library erred by outsourcing the entire operation to a law firm, Fleischaker said.

"I mean no disrespect to the lawyers, because I am one," he said. "But this seems to be an awful lot of money. The whole concept of open-records law is that it's the function of government to provide its own records upon request, not farm it out to private counsel at great expense."

J. David Porter, one of the Stites & Harbison attorneys involved, said the firm properly billed every month for work the library board asked it to do.

Apart from its other bills, the firm charged the library about $79,000 to study Imhoff's employment contract and advise the board about the time that the board fired her.

The library also was billed more than $35,000 by Meridian Chiles, a marketing firm, for work to burnish its image during the newspaper's reporting from March through July.

Meridian Chiles placed large advertisements in the Herald-Leader promoting the library and offered "reputational and crisis management" to library managers, according to billing records. Mary Ellen Slone, a Meridian crisis manager who billed at a rate of $150 an hour, attended at least one of Imhoff's interviews with the newspaper.

"They were assisting us with matters regarding our public image," said Smith, the library board chairman. "They've had some experience dealing with negative publicity."

However, Smith added, roughly half of Meridian's billing was for advertising that the library would have wanted regardless of the critical news coverage, to tell the community about its expanded evening hours and other new services.

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