Politics & Government

Two Democrats competing to manage Kentucky's checkbook

State Treasurer Todd Hollenbach being sworn into office by Chief Judge Sara Walter Combs (not pictured) at the Capitol Rotunda in 2008.
State Treasurer Todd Hollenbach being sworn into office by Chief Judge Sara Walter Combs (not pictured) at the Capitol Rotunda in 2008.

FRANKFORT — Kentucky's state treasurer oversees billions of dollars in spending and collections, but he doesn't control the money. He hangs on to the state's checkbook while others decide who gets what.

Aside from issuing roughly 10 million checks and seven million electronic transfers a year, the treasurer sits on several state boards, including those for the Kentucky Lottery and the Kentucky Teachers' Retirement System.

Few people notice the treasurer unless he disappears with the treasury, as James "Honest Dick" Tate did in 1888.

Nonetheless, two Democrats are vying for the job in the May 17 primary: incumbent Todd Hollenbach, who is paid $108,720 a year, and Hopkinsville business owner Steve Hamrick.

The winner will face Republican KC Crosbie, a Lexington-Fayette Urban County Councilwoman, in the fall. Crosbie has no Republican primary opponent.

Todd Hollenbach

Hollenbach, 50, is a Louisville lawyer finishing his first four-year term as treasurer. In an interview, Hollenbach said he manages his office competently despite a reduction in spending, down to $2.8 million this year. He employs 32 people, including himself, compared to his predecessor's staff of 45, he said.

To accommodate budget cuts, Hollenbach said, he chose not to hire a press secretary; he eliminated the travel budget for himself and senior aides; and he did not provide his staff with state-owned cellphones or BlackBerries.

At the same time, he said, he reconciled the state's books for the first time in years, "which was a Herculean task because time doesn't stand still. You're busy reconciling one year, but more checks are coming in and going out today."

He teamed with local officials to return more unclaimed property from the treasury than his predecessor, he said.

Hollenbach also touts the financial literacy programs on which he campaigned in 2007, at no cost to taxpayers, he said. He hosted an online seminar last year featuring economists and state leaders. This year, he plans a "boot camp" with 53 participating high schools, to be assisted by area banks.

"There are more kids dropping out of college these days because of excessive debt levels than there are because of bad grades," he said. "If you can catch them before they're 18, that's a good time for education."

Steve Hamrick

Hamrick, 60, ran for Congress twice as a Republican in the 1990s, losing both times. He later switched parties to become a Democrat after concluding that "with the Republicans, it's all about the money."

Hamrick, a college textbook dealer and education consultant, supported Hollenbach's candidacy in 2007. But he says Hollenbach disappointed him by being an absentee treasurer and spending too much time on the golf course, an allegation that Hollenbach denies.

"It could be run much better and much more efficiently than it's currently being run," Hamrick said. "His performance in office was not anywhere near what we hoped to get from him."

As evidence, Hamrick cites a recent report from state Auditor Crit Luallen that identified several problems the treasurer's office needed to correct.

Among them was a need for stronger data security and a segregation of duties for the one employee who monitors data for suspicious activity while also being able to alter data himself. That employee is not accused of wrongdoing, but it would be safer if different people had oversight jobs because then they could monitor each other, the auditor said.

In his reply to the audit, Hollenbach said his office is working to improve data security. However, hiring an additional data oversight employee would cost about $65,000 a year, he said.

As of Monday, Hollenbach reported raising $63,479 in campaign donations to Hamrick's $7,210. Crosbie, the sole Republican candidate, reported $57,510.