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Kentucky Lawmakers Select National Conference of State Legislatures to Conduct Audit

  FRANKFORT—Lawmakers approved an audit of the state’s largest bureaucracy Wednesday.

A panel of Kentucky lawmakers voted 9-5 to hire the National Conference of State Legislatures to conduct an audit of the Legislative Research Commission, an agency that provides research and support staff to the General Assembly.

Taxpayers will be on the hook for the more than $42,000 performance audit, which will encompass hiring a new director for the embattled agency to replace interim acting director Marcia Seiler; conducting interviews with its nearly 400 full-time employees; and determining if the agency needs to be restructured.

The LRC has come under fire over its handling of employee harassment complaints relating to allegations against former lawmaker John Arnold, a West Kentucky Democrat who resigned in September. Former LRC executive director Bobby Sherman, who is named in the complaints against Arnold, retired in September. Sherman is currently under investigation by the Kentucky State Police for shredding work documents.

Senate President Robert Stivers says that although the price tag appears to be steep, the NCSL's experience with state government across the nation ensure that they will conduct a thorough audit.

“Because this is such a huge portion of government ... the cost, really, shouldn’t be that big of a factor," he says. "You want to get the job done, the right way the first time. Let’s measure twice and cut once.”

Five House Democrats, including House Speaker Greg Stumbo, voted against the proposal. In the meeting, Stumbo contended that Lexington-based Hanna Resource Group, which also submitted its audit proposal to lawmakers last month, could have done the same job for much less taxpayer money, and that the NCSL has only conducted one similar audit.

“It’s a lot cheaper," Stumbo said. "I’m not a big fan of paying more for more government studies that end up on a shelf somewhere.”

Brian Weberg, director of the NCSL's legislative management program, says his organization has conducted similar audits of agencies equivalent to the LRC across 19 states, and has personally overseen 15 of them.

Lyle Hanna, president of Hanna Resources Group, told the same panel of lawmakers in November that his company could have performed a similar but less comprehensive audit for $15,000.

Hanna has donated more than $4,000 to Democratic candidates in local, state senate and house races in the last 15 years. When asked if that would impede his company's objectivity in conducting an audit surrounding an issue that has, so far, implicated only Democratic lawmakers, Stumbo demurred, saying that he didn't think that would play a factor in their performance.

Stivers, however, thinks the NCSL study could save money over the long term, and would delegate the issue of promotions and employee compensation studies to the new director.

"Maybe the new director can come in and say ‘Here, I’ve got a whole series of things that I’ve looked at, I’m aware of these things, and this is what I would suggest for hirings, firings, promotions, compensation,’ so individuals know how they are going to be judged on their performance and what they have to look forward to," Stivers said, adding that he was not aware of the LRC ever undergoing a compensation study.

A story by the Kentucky Center for Investigative Journalism examined patronage and lax workplace relationship rules within the LRC, particularly implicating former director Sherman and a subordinate with whom he was allegedly having an affair.

Stumbo believes the issue of compensation should be addressed, as well, but disagrees on how it should be carried out.

The NCSL's proposal states that audit itself could begin as early as January, and would yield a final report before or by April.

Below is a copy of the NCSL's amended proposal.
Kentucky Proposal Amended

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