Lenny Stoltz II, executive director of the Bluegrass Area Development District, was placed on administrative leave Monday night following a three-hour, closed-door meeting of the Lexington-based agency's executive board.
The agency helps coordinate regional planning and federal spending among local governments in a 17-county area. Its board of directors is made up of mayors and judge-executives from member counties. Lexington Mayor Jim Gray confirmed that he was among those at Monday's meeting of the executive board but declined to provide further details.
David Duttlinger, the agency's assistant executive director, was named interim executive director at Monday's meeting.
Duttlinger said Tuesday he could not comment on why Stoltz was placed on administrative leave or how long the leave might last. Stoltz' name and photograph were no longer visible on the agency's website Tuesday afternoon.
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Stoltz did not return a phone message left Tuesday afternoon seeking comment.
Duttlinger said he was not aware of any state or federal investigation of Stoltz or the Bluegrass ADD, but a spokeswoman for State Auditor Adam Edelen said Tuesday that the office had received a complaint about Bluegrass ADD and was reviewing the information.
"As we do with all complaints that come through our office, we will take a look at the information and determine whether to proceed," said spokeswoman Stephenie Steitzer. "We are not in a full-blown examination at this point."
Duttlinger confirmed Tuesday that another Bluegrass ADD employee was placed on administrative leave in recent weeks. Tanya Fogle was director of Steppin' to a New Beat, a program aimed at providing inmates support and skills to help them live successfully outside jail.
Stoltz and the Bluegrass ADD have been embroiled in a running battle with River Park neighbors for more than a year after the agency bought a 6.5 acre tract at 1393 Trent Boulevard for a residential work-training program for felons.
River Park residents became angry when they were not able to "get a straight answer" from Stoltz on who would be housed in buildings on the Trent Boulevard property, how many people would live there and the intent of the work-training program, said Charles Payne, president of the River Park Neighborhood Association.
In an opinion handed down in June 2012, the state attorney general said Bluegrass ADD had to open its records about the land deal and the proposed program to the neighborhood association. Stoltz had refused the association's request for information, saying its request under the state Open Records Act had not been submitted on the correct form.
In a second opinion, the attorney general's office ruled that Bluegrass ADD did not have the authority to implement or operate a re-entry program for felons. The agency could only become involved in such a project if a local government requested its help through a memorandum of agreement, according to the opinion.
The Lexington-Fayette Urban County Government had never made such a request.
The Bluegrass ADD bought the former Excepticon campus in January 2012 for $600,000 and spent another $500,000 to begin renovation on some of the eight buildings on the property.
At least $300,000 of that money was spent on no-bid contracts despite rules for the organization that normally require bidding on any purchase above $2,500, according to records examined by the Lexington Herald-Leader.
Most of that money was paid to Fayette Heating and Air, a company owned by Bret Melrose, a member of the Bluegrass Workforce Investment Board, which was set up by Bluegrass ADD with federal workforce investment funds.
Last year, Stoltz told the newspaper he did not put the work out for bid because it needed to be done quickly, and was an emergency situation. After the second attorney general's opinion, the agency put the tract up for sale for $1,170,000. It has not sold.
River Park's Payne said Tuesday that he was surprised that Stoltz was put on leave.
"I am tickled to death to see there are some people on the board who are willing to take a stand and do something," Payne said.
"Obviously the executive committee felt they had reasons. I would very much be interested in what those reasons were."