Kentucky

Audit: Owen officials overpaid themselves

An Owen County judge-executive who is set to go to trial in January for misspending county money overpaid himself for the second straight year, a state audit released Tuesday showed.

Owen County Judge-Executive William "Billy" O'Banion received an additional $3,300 in training expenses in the past fiscal year, and former Deputy Judge Executive Renaee Gaines overpaid herself $2,917, an audit of the county's books from July 1, 2007, to June 30, 2008, showed. Gaines' salary was $35,000.

A 2007 state audit showed that Gaines, who did payroll for the county, overpaid herself by $14,000 in the previous fiscal year. O'Banion was accused of taking an additional $3,300 in expenses.

Gaines later resigned.

Information from the 2007 audit was turned over to investigators. In September, O'Banion and Gaines were indicted by an Owen County grand jury on theft and other charges. County Treasurer Gayle Lewis was accused of allowing the misappropriation of county money.

Gaines pleaded guilty Dec. 23 to three felony counts and two misdemeanor counts, said Commonwealth's Attorney James Crawford. Sentencing for Gaines is set for Jan. 23.

Lewis and O'Banion have pleaded not guilty. A trial is set for January in that case.

O'Banion said he could not comment on the audit because of the pending criminal case. A lawyer for O'Banion did not return calls asking for comment.

State Auditor Crit Luallen said information from the 2008 audit was shared with Crawford before its release Tuesday. The September indictment included the money that the two allegedly overpaid themselves in 2007 and 2008.

According to the audit, O'Banion received a lump-sum payment for training in April 2007. In October 2007, he received an additional check for $3,300. By law, judge-executives are allowed one training check in a calendar year, according to the state auditor's office. Over the two-year period, O'Banion exceeded the amount he should have received by more than $6,000.

The audit also found that the county magistrates have been paid $300 in addition to their salaries to serve on standing committees of the fiscal court. The magistrates were not serving on any committees at the time they were being paid the $300 monthly checks.

According to the county response included in the audit, the county has since created standing committees for its magistrates to serve on. The audit also noted that county-issued credit cards for gas and other expenses were often reimbursed with no supporting documentation.

The county was also cited for waiving ambulance charges for certain county residents, including O'Banion. The county, in its response, said it was directing the county attorney to collect all uncollected ambulance bills.

The auditor recommended that the county shore up its accounting practices and implement more controls over money management. The audit also said that Owen County's accounting software allowed an employee to backdate payroll checks, which resulted in some of the questionable payroll checks never being posted in the 2008 financial records. The software allowed access by multiple users, the audit found. The system should have more internal controls and limit the number of users.

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