FRANKFORT, Ky. — Three of the five stories in the old, nondescript brick office building at 209 St. Clair Street house a state office that tries to determine if taxpayers’ dollars are spent properly.
It is not the most exciting place in the world. Its scenery is dull. A lot of number crunching is always going on. But its work is vital to the operations of an efficient government.
In recent years under Republican Mike Harmon, the state auditor’s staff of about 125 has adopted his mantra to “follow the data,” and turned over some major financial failures and inadequacies in government.
They include “disorganized and unchecked” leadership in the state courts system, “unnecessary and excessive spending” in the state’s police training program, a “dysfunction” between the University of Louisville and its non-profit investment arm, warnings about the KentuckyWired project to bring the internet to all of Kentucky and every state agency’s share of the state’s massive debt for public pensions.
It also has uncovered criminal wrongdoing by several county government leaders, leading to the 2019 conviction of former Jackson County treasurer Beth Sallee for stealing $161,000 by writing checks to herself from county accounts and the 2022 guilty plea of former Lawrence County Attorney Mike Hogan and his wife and legal secretary, Joy M. Logan, for taking part in a scheme to pay her more than $365,000 in bonuses while working in his office.
This fall, two women are vying in the Nov. 7 general election to replace Harmon as the chief watchdog of taxpayer dollars in Kentucky. Harmon could not seek another four-year term because he already has served two consecutive terms. He ran for governor in last May’s Republican primary election but lost. It’s not certain what he is going to do after the election.
Seeking to replace Harmon are Republican Allison Ball of Prestonsburg, who was elected Kentucky’s treasurer in 2015, and Kimberley “Kim” Reeder of Morehead, a tax attorney and teacher making her first bid for public office.
The race thus far has been fairly quiet. Neither candidate has gone into attack mode. There has been no vitriol. No one has been mean-spirited.
Instead, the candidates have been touting their records and their political views whenever and wherever they can. Reeder is trying to take her RV to all 120 Kentucky counties.
Their total campaign contributions to date are about the same. Reeder has amassed more than $143,000 while Ball has taken in about $136,000. The job pays $148,108.56 a year.
Each candidate claims she is ready to keep an eye on taxpayers’ dollars spent in all three branches of state government, local and county governments and public education.
Why she wants the job
Ball, who is proud that she is the first Kentucky constitutional officer to give birth in office (twice), said she started as a watchdog “on the front end” as state treasurer with money coming in and now wants to be a watchdog “on the back end” to see that state money is used correctly.
“If you want to know what I will be like as auditor, look at what I have done as treasurer,” she said.
So what has she done as treasurer?
She rattles off returning a record $172 million of unclaimed property, more than any state treasurer in Kentucky history in a single year; launching Kentucky’s transparency website showing how state government spends its money, starting a savings and investment program for Kentuckians with disabilities that allows families to save money while continuing to receive assistance at no cost to Kentuckians, and beefing up financial literacy.
Ball also noted that she was a prosecutor in Floyd County. “All these pieces of the puzzle fit together to show what kind of auditor I will be.”
Reeder said her commitment to public service and passion for education and social justice led her to running for auditor.
She said her childhood poverty spurred her to earn acceptance to Yale University, where she graduated with a degree in political science.
She then went on to earn a master’s in public policy from Duke University and a law degree from the University of North Carolina Law School.
After graduating, Kim earned recognition in 2011 as one of the top 10 tax attorneys in the nation by industry publication State Tax Notes. She returned to Kentucky in 2014 to take care of her dying mother.
After her mother’s death, she stayed in Kentucky and became a full-time substitute teacher to help a teacher taking maternity leave.
This experience led her to obtain a teaching certificate and ultimately to teach in some of the most disadvantaged classrooms in Kentucky. She said she now wants to work for all Kentuckians as state auditor.
What to tackle first as auditor
Ball said she would continue the work of Harmon in auditing disaster relief funds initiated by Democratic Gov. Andy Beshear to support victims of tornadoes and flooding in the state.
Harmon announced this year he was auditing the funds after some reports that some checks were sent to the wrong recipients. Harmon has not said when that work will be completed.
Even if he has an audit completed by the time he leaves office at the end of this year, the funds still will be raising and spending money after Harmon leaves, said Ball.
She has said she notified the Public Protection Cabinet, which oversees the funds, about some problems with the funds, and suggested an audit but was turned down.
Besides the relief funds, Ball said she would like to audit the Jefferson County Public Schools, especially its transportation system, and some public universities. She noted that Harmon found financial problems at Kentucky State University and that Northern Kentucky University has had some large budget deficits.
Reeder said she would take a broad look at state education funding, especially the underfunding of transportation, before zeroing in on JCPS or other specific school districts. She also said she would carefully consider Harmon’s findings on the disaster assistance funds before deciding whether to finish a full-blown audit. “I’m a person who believes in strong reviews and then go after those that fail the reviews,” she said.
Reeder said she also wants to shine a light on public education funding gaps that penalize poor children and their schools.
Reeder said it was “a proud moment” for Kentucky in 1990 when the legislature equalized funding between poor and wealthier school districts in response to the Supreme Court’s historic decision in Rose v. Council for Better Education. But the funding gap has opened up again, she said, and is now as large as it was before the 1990 Kentucky Education Reform Act.
“We have students now whose education is not complying with the law. It is very disappointing.”
Pension investments
Ball said she would like to keep a close eye on the possibly dangerous full integration of ESG issues into the investments of public pensions. ESG stands for environmental, scientific and governance issues.
The ESG aspects of a company’s activities are used to measure the company’s societal and sustainability policies. ESG criteria are applied most frequently by investment firms and individuals who want to direct their money toward companies that are socially responsible.
Earlier this year, Beshear signed into law a measure that requires the state’s public pension funds to make investment decisions on financial risks and returns, rather than environmental, social, and governance (ESG) factors.
Reeder said there may be room to consider ESGs. Companies need to take a wide range of risks into account when making investments, including environmental factors, she said.
She said any government employees charged with managing funds are always doing risk management. That, she said, already includes some consideration of how investment returns could be impacted by any sort of trend, including climate trends.
Transparency and politics
Both candidates pledged transparency in their office by making better use of online information and to be sure it is non-partisan.
Each pledged to “go after” a governor or any political leader who does wrong even if they belong to her political party.
This article is republished under a Creative Commons license from Kentucky Lantern, which is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. Kentucky Lantern maintains editorial independence. Contact Editor Jamie Lucke for questions: info@kentuckylantern.com. Follow Kentucky Lantern on Facebook and Twitter.
