The Kentucky Association of Counties will cooperate with state Auditor Crit Luallen and wants her to fast-track an audit of KACo so it can make changes quickly to expense policies, the group's president said in a letter Wednesday.
"KACo leadership is committed to offering your staff our full cooperation as you plan the audit of KACo's financial records," KACo President J. Michael Foster, the Christian County Attorney, said in a letter to Luallen.
Luallen announced last week that her office would examine spending and expenses at the non-profit association, which offers insurance and financing services to counties and provides lobbying, training and legal help. KACo's board of directors is made up of elected county officials from across the state.
Luallen's decision came after the Herald-Leader reported last week that the top five staff members at KACo spent $600,000 over two years for travel, meals and other expenses.
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The auditor's office also will investigate spending at the Kentucky League of Cities. A Herald-Leader review found that the League's top three executives spent more than $300,000 since 2006. Travel by all League employees cost $457,000 in 2008.
The League's board agreed to cooperate with the auditor's office last week.
Luallen has contacted Foster and League President Connie Lawson, the mayor of Richmond, to set up a first round of meetings with officials at both associations, said Terry Sebastian, spokesman for the state auditor.
"Our plans are proceeding on schedule," Sebastian said. "We are pleased that both boards recognize the value of independent reviews that will offer recommendations to improve financial oversight going forward."
The organizations aren't government entities, so the boards could have chosen to fight the audit, according to KACo Executive Director Bob Arnold, who said last week that the organization's executive committee would have to make that call.
Luallen, however, cited state statutes that she said give her office the authority to investigate the League and KACo. In addition, the auditor's office performed a detailed review of KACo in 1993, setting a precedent, she said.
Foster said in an interview that the five elected officers on KACo's executive committee agreed unanimously during a conference call Tuesday to open the organization's books for auditors.
Foster said the audit will be a crucial tool in helping the board strengthen oversight of spending.
"The executive committee of KACo wishes to pursue every reasonable opportunity and utilize every available resource to address the financial management and integrity of the organization," Foster's letter said. "Given the commitment of the executive committee to address these issues in a timely and responsible manner, we trust you will expedite your planned audit."
At the same time, Foster said, he and the other executive committee members will begin discussing their own recommendations to bolster oversight of KACo spending.
The other officers are President-elect Rick Smith, a Clark County magistrate; First Vice President R.W. "Buckwheat" Gilbert, Lincoln County judge-executive; Second Vice President Chris Harris, a Pike County magistrate; and past president David Jenkins, Spencer County judge-executive.
"Our plans are to start trying to develop both short-term and long-term plans to address the issue in general," Foster said. "I see the audit as one piece of the puzzle."
Those discussions will begin in "the next few weeks," Foster said. The committee hopes to provide suggested policies for the full KACo board of directors to consider at its next meeting in September.
Foster said one idea is to call a task force of county officials who have accounting or financial backgrounds to make suggestions.
Larue County Judge-Executive Tommy Turner, who is a member of the full KACo board of 34 officials from around the state, said he'd like to see the executive committee solicit broader input.
"I feel like the full board is being left out of some of the decision-making," he said, adding that "more and more power and authority has been taken by the executive committee" of just a handful of officials.
Smith, the president-elect, said county officials from across the state will get their chance to offer input during next week's joint conference of the Kentucky County Judge-Executive Association and Kentucky Magistrates and Commissioners Association in Louisville.
"We're open to any suggestions," Smith said.
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