Special Reports

KACo president's legacy: reforms

It was a bowl of soup that first tipped J. Michael Foster to the trouble that lay ahead for the Kentucky Association of Counties.

Foster, who ends his year as the organization's president at its annual conference this week, used his KACo-issued Visa card last winter to pay for a business lunch, where he ordered soup.

When the longtime Christian County Attorney turned in his receipt with the names of those in attendance, he was greeted with a quizzical look from the KACo employee.

"That struck me as strange that they were surprised I was turning in a receipt with all those details on it," he said. "So I said, 'Let me see your credit card policy.'"

KACo had none.

It was an "uh-oh" moment, Foster recalled in an interview last week, that forced him to recast his ambitions for the year.

He has since led KACo's board to approve three rounds of reforms and implement financial controls amid a barrage of news coverage about KACo's spending and an investigation by the state auditor.

"I'm not sure the organization would have survived this" without Foster at the helm, said Christian County Judge-Executive Steve Tribble, a KACo board member.

Despite the unexpected challenges, Foster gave no hint of self-pity. After all, this is a man who has survived throat cancer and an aggressive, experimental treatment that nearly killed him — twice.

"I appreciated life before, I promise you I did. But it does change your perspective, I guess," Foster said. "I refused to let cancer define who Mike Foster was."

He said that fight for his life only reinforced his personal philosophy: Some of the best opportunities are born in the shadow of crisis.

He has repeated that mantra during KACo board meetings during the last five months, ever since the Herald-Leader reported that KACo's top staff members spent $600,000 in two years on meals, entertainment and travel.

Among the expenses incurred on the KACo credit card of former executive director Bob Arnold was a $270 charge to a Lexington escort service. The newspaper also found a total of $620 in charges to KACo's 2008 president, Spencer County Judge-Executive David Jenkins, at two Louisville strip clubs and the Lexington escort service.

Arnold resigned in September, and Jenkins stepped down from the board.

Last month, state Auditor Crit Luallen's review of KACo found $3 million in undocumented, improper and excessive spending at the organization since July 2006.

Foster's leadership has won praise from Luallen, who said she hoped some of the changes will break up an entrenched "self-serving" culture at the non-profit organization, which provides legal and lobbying services to counties, sells them insurance and offers loan financing.

"KACo was in crisis. It's fair to say," Foster said. "As many good things as KACo did and does with its programs and services, the internal financial management threatened the integrity of the entire organization."

Back to Hopkinsville

Foster, a forward on his Christian County High School basketball team, was the only starter on the 1964 team not to get a scholarship to a major college program.

So he became part of the first graduating class at Hopkinsville Community College and went on to the University of Kentucky, where he graduated from law school in 1972.

After working for then-Lt. Gov. Wendell Ford and Ford's successful gubernatorial and U.S. Senate campaigns, Foster was persuaded to return to Hopkinsville by another former Democratic governor.

Edward T. "Ned" Breathitt recruited Foster to work for his law firm there — an office with a long history of employing the Christian County Attorney.

By 1982, Foster was elected to that post and went on to develop a reputation around the state as a tough but fair prosecutor.

In summer 2006, Foster found he couldn't kick a sore throat. Thinking it was allergy-related, Foster went to a specialist in Nashville that September. The doctor found a mass.

"He said, 'We have to do a biopsy for sure, but I know what I see, and what I see is cancer,'" Foster said. "When you deal with 15,000 cases a year of child abuse, assault, theft, elder abuse, DUIs, nothing shocked me. Well, I guarantee you, that day Mike Foster was shocked."

Will to live

On his drive home, he called to tell his wife, Marilyn.

"She said, 'Well, Mike, cancer picked on the wrong person this time. We're going to do what it takes to beat it,'" Foster recalled. "That's what I needed to hear."

Because the cancer had progressed, doctors suggested an aggressive, risky treatment that had been approved only recently: a cocktail of several forms of chemotherapy run continuously through his system for 10 days. The doctors' message: "We think if it doesn't kill you, it'll cure you."

Foster, who has maintained his lanky physique from high school, was in good shape. But by the 10th day of treatment, which was administered at home, he was unaware of his surroundings and rushed to the hospital.

He survived, but in March 2007, a blood clot formed in his lung, and he developed an antibiotic-resistant bacterial infection. "That's when I thought I might not live," he said.

Unable to eat without pain, Foster had lost 50 pounds and gone bald.

Still, he attended most fiscal court meetings during the time, sometimes in a wheelchair, said Tribble, the Christian County judge-executive who is a longtime friend.

By 2008, Foster's health improved in time for his term as KACo president to begin that November.

Never again

This wasn't Foster's first stint with KACo. He had served on KACo's insurance board in the 1990s, just as the state insurance department determined the program was running a nearly $10 million deficit.

"Mike was one of the more vocal people who said, 'We have to get it right,'" said George Nichols III, who was Kentucky's insurance commissioner at the time and declared KACo's main insurance fund insolvent. "That's why it didn't surprise me when I read what he has done in the face of this latest situation."

In 1996, Foster signed the insurance fund's bailout documents and made the motion to sever ties with third-party administrators whom they believed had mismanaged the funds. The fund has since bounced back to have a $20 million surplus.

"The strange thing about this is, I said, 'Boy, I never want to do this again,'" Foster said.

But in 2005, he ran for the executive committee because he said he wanted to help expand programs and show officials it wasn't just an organization for judge-executives and magistrates.

Again, he found himself in the thick of KACo controversy. With the help of a key group of board members, he responded by proposing reforms, starting with the creation of an audit committee and new expense approval procedures.

Foster said the Herald-Leader's coverage and state audit, though scathing, "helped me and other people so inclined to clearly define the urgency of the situation."

Chris Harris, the Pike County magistrate who will be promoted to president-elect this week, said he learned much from watching Foster manage the storm.

"Mike has met some very challenging issues head-on, issues that have required him to set aside longtime friendships, political alliances and personal feelings in order to meet his fiduciary obligations to the organization," Harris said.

Foster's work with KACo isn't done. He remains on its board for another year as past president. And he will continue to head the search committee looking for a new executive director. Fifty-four people have applied for the job, and Foster said he hopes someone can be hired around Jan. 1.

Still, his lasting contribution to KACo will be the ongoing internal changes, he said.

"Personalities come and go," he said. "What I did as president, hopefully, will lead to long-term reform."

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