Herald-Leader Editorial

Wise to withhold funds from ADD; rehire of fired director troubling

July 11, 2013 

It's hard — really almost impossible — to understand how an organization with 90 employees, responsible for millions in public monies, could operate with only one person who understands its accounting system.

It's even more difficult to understand when nine other employees, including a chief financial officer, have "financial" in their titles.

Yet, this is what we are told about the Bluegrass Area Development District.

"He's the only person who knows that code or that program," acting executive director David Duttlinger said to explain his decision to pay recently deposed executive director Lenny Stoltz II $8,000 a month as a consultant.

Hats off to the Lexington Fayette Urban County Council, which Tuesday evening voted to withhold the city's $75,000 contribution to the Bluegrass ADD until this extraordinary failure in governance is resolved.

As is often the case, this particular failure is a symptom — albeit a serious one — but not the underlying problem.

That there is a larger dysfunction has become disturbingly obvious as a series of problems have unfolded, including the ADD's purchase of a property to establish a program it did not have the authority to operate, its efforts to block neighbors from access to information about the project, and other questionable activities.

The dysfunction is all the more troubling because the ADD — which like others in Kentucky was established to coordinate and facilitate planning for transportation, infrastructure, land use and other projects within and among several counties — is overseen by a board made up entirely of elected officials from those counties.

Stephenie Steitzer, spokesperson for the state auditor of public accounts, said the most common issues that arise when local governments are audited involve problems with "segregation of duties" to assure there are checks and balances within an accounting system.

A system in which only one person controls accounts — duties aren't segregated — "can potentially increase the risk for fraud, theft and abuse," she said.

It's troubling that a board made up of public officials would fail to see the weakness built into the ADD's accounting system.

The auditor's office has begun a thorough review of the ADD's operations and accounts. That effort will, thankfully, provide a clearer picture of what's been going on inside an agency sadly lacking in both transparency and oversight.

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