The cause of good, transparent government got a boost last week when Hal Heiner, the new secretary of the Education and Workforce Development Cabinet, said the process to award an $11 million federal workforce contract to the Bluegrass Area Development District was flawed and should be restarted.
The executive committee of the local officials who oversee the Bluegrass Workforce Area, which awards the grant, is meeting today to consider what to do next. It’s simple: They must start over and do it right this time.
From one perspective, it’s not surprising this process hasn’t gone smoothly. After decades of awarding the money to the Bluegrass ADD without any competitive bidding, this competitive process mandated by the state was new and very different. But that is no excuse for careless stewardship of public money and programs.
As we’ve said before, the deal did not meet the smell test when the Workforce Area directors, who are all also directors of the Bluegrass ADD, decided to award the contract to the ADD over two other bidders.
This was particularly troubling since those reviewing the applications seemed to overlook some major concerns with the ADD under the category of “fiscal integrity.”
The Bluegrass ADD — which was formed to coordinate regional economic planning among 17 counties in the region — was the subject of a blistering report by the state auditor’s office in 2014.
That report found the ADD had mismanaged federal grants; failed to report criminal activity; had conflicts of interest, inadequate oversight of travel expenses and a lack of internal controls. An investigation by the cabinet found $2.8 million in questionable costs at the ADD. Still, the reviewers gave the ADD an average score of 226.5 out of 300 on fiscal integrity.
Although it’s a little hard to imagine those voting weren’t aware of this history, Heiner’s letter does offer some insight into how they may have come to overlook it: The Bluegrass ADD sugarcoated — or lied about, choose your verb — the history in its proposal.
Heiner’s letter points out that the ADD acknowledged the auditor’s findings but went on to say, “All eight findings were resolved.”
“The Cabinet does not agree with this statement,” Heiner wrote. Each of the eight findings had multiple subsections. “Sixteen subfindings have not been resolved as of this date,” he wrote on Jan. 20.
In addition, although the ADD has responded to the $2.8 million in questionable costs the cabinet found, that matter has not been finally resolved. The ADD also did not supply copies for all the reviewers, as instructed in the request for proposals, of the auditor’s findings, the corrective action plan and the incomplete state of those corrections.
If that’s not enough, Heiner wrote that the ADD also failed to mention the Kentucky Department for Aging and Independent Living found the ADD had disallowed costs in its management of state and federal grants that have not been resolved.
It’s easy to glaze over at this convoluted story. But the individuals and public officials, including neighborhood activists who first brought some of these issues to light, Heiner and Lexington Mayor Jim Gray who was the lone vote against awarding the contract to the ADD, deserve thanks and respect.
At the heart of the matter is millions in taxpayers dollars intended to help people get the training they need to get a first job, or a better one.
Awarding that money to a familiar, but troubled, organization with selective memory through a flawed process is no service to the Bluegrass region.