FRANKFORT — Agriculture Commissioner James Comer announced Wednesday that he was shutting down a $3.1 million fuel testing lab created by former commissioner Richie Farmer, saying it was a waste of taxpayer money.
The Department of Agriculture will send its fuel samples to a private company in Texas for testing. By shutting down the lab and outsourcing the testing, the state could save more than $600,000 a year, agriculture officials said Wednesday.
Farmer and his staff had told the legislature in 2008 that the state could generate a profit by investing $3.1 million in a lab that would test fuel from Kentucky and surrounding states. The lab could also test pesticides, former agriculture officials said.
Comer, a former state representative, said Farmer's staff had told the legislature that they had contracts with surrounding states and that the lab was profitable.
Comer said that when he took over the department in January 2012 from Farmer — a former University of Kentucky basketball star — he learned that those contracts never existed.
"On Day One, I learned there were no contracts with surrounding states," Comer said. "The pesticide lab wasn't even being used. In fact, all of the pesticides that we tested here in the department, we were sending out of state to a private lab."
Comer's staff also found a backlog of gasoline samples that still needed to be tested. That backlog has since been cleared, agriculture officials said Wednesday.
It cost the state about $900,000 a year to run the laboratory in addition to the $3.1 million that it took to buy all of the equipment, said Steve Kelly, the director of strategic planning and administration for the department.
Comer's staff has been able to cut back on some expenses — including reducing staff from nine to one — to about $500,000 a year. But annual rent on the building that houses the fuel testing lab is about $199,000.
Agriculture officials plan to do away with the rent on the lab or another building to save additional money.
The contract with the private lab will cost about $330,000 a year to test gasoline samples, agriculture officials said Wednesday.
The Department of Agriculture is responsible for ensuring the quality of gasoline sold in Kentucky. It also monitors gas pumps to make sure that consumers get a full gallon of gas. The switch to a private contractor will not harm Kentucky consumers, Comer said Wednesday.
"We will still conduct all the quality testing," Comer said. "The only difference is instead of hemorrhaging money in an in-house lab, we're going to do it through the private sector at a huge cost savings."
After discovering that the contracts with other states never existed, Comer appointed a fuel-lab task force to determine whether the fuel lab could be profitable. The task force ultimately decided there was no way for the lab to turn a profit, and it would be a continuing drain on taxpayers, Comer said Wednesday.
Larry Cox, deputy commissioner of agriculture, said that the lab was ill-conceived from the start. The former administration even ordered more equipment than needed, he said.
At a press conference at the fuel testing lab in Frankfort on Wednesday, Comer pointed to eight distilling machines used to test gasoline in the lab. The state spent $200,000 for the eight machines.
"They only needed two," Cox said.
Comer is hoping to sell the laboratory equipment. He said officials are talking to the University of Kentucky to determine whether the university could take over testing in future years.
The shuttering of the fuel testing lab is just the latest fallout from Farmer's eight-year tenure as agriculture commissioner. After serving his two terms, Farmer ran unsuccessfully for lieutenant governor in 2011 with former Senate President David Williams on the Republican ticket.
Comer, also a Republican, was elected that year.
An audit conducted by state auditor Adam Edelen in 2012 found widespread problems at the department under Farmer, including wasteful and questionable spending. The report also found that Farmer used state employees to run personal errands — including chauffeuring his dog.
The Executive Branch Ethics Commission recently charged Farmer with 42 ethics violations, most of which stemmed from Edelen's audit. That case is ongoing.
Bruce Harper, who served under Farmer but was kept by Comer, also was charged by the Executive Branch Ethics Commission. Harper was placed on administrative leave after the ethics commission charges were released last month.
Comer said Wednesday that Harper has been asked to resign or face termination.
Comer has said in the past that the FBI had interviewed some of his staff about Farmer's tenure. Officials with the FBI and Attorney General Jack Conway's office have said they can neither confirm nor deny an investigation.
Comer said Wednesday that he not received subpoenas regarding Harper or Farmer.