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State Auditor Blasts Finances of West Buechel, Refers Case to FBI

West Buechel

Misspent funds and poor record-keeping in a small Jefferson County suburb amount to an “abuse of the public," state Auditor Adam Edelen says.

Thousands of government dollars in West Buechel were spent to purchase goods that served no purpose to the city’s residents, according to a state audit report released Thursday. Money was also spent on orders from home shopping networks, among other things.

The auditor's report is being referred to the attorney general, FBI and Kentucky Department of Revenue, Edelen’s office said.

“In four years of literally conducting hundreds of audits, this ranks among the worst,” Edelen told WFPL. “It’s time for the residents of West Buechel to really do a gut check about whether or not this local government has the ability to clean up the mess.”

His office found several hundreds of thousands of taxpayer dollars in questionable spending — most of which was spent without any approval from the city’s elected legislative body.

Rick Richards, who was elected West Buechel's mayor last year, pressed the city council to pass a measure asking the state auditor to look into the city’s finances and how it was operating under a previous mayoral administration. In January, the council passed a resolution prompting the investigation.

Richards has called the situation he walked into this year "very frustrating."

Sharon Fowler, the previous mayor, could not be reached for comment.

“We’ve got a government that is out of control, that is unable to track hundreds of thousands of city money. And the people there deserve a lot better,” Edelen said.

West Buechel is an incorporated city in Jefferson County with a population of about 1,300. The city operates a small police department, public works and other services. It had $1.5 million in expenses in the 2014 fiscal year and ran a $112,432 surplus, according to the auditor's report.

Edelen said the underlying issue here is the lack of transparency and checks on the city administration.

Besides not clearing financial matters with the city’s elected officials, administrators didn’t keep a paper trail, which made auditing the city difficult, he said.

According to the report, “except for an incomplete summary of payments made to city vendors, city officials did not provide any type of financial statement or ledger.”

“I can’t say I was totally surprised, but I would have thought certain things would be in place,” said Richards.

Among the documents West Buechel did not provide from the past few years were:

  • Detailed staff information related to position and salary data
  • Supporting documentation for expenditures for the past couple years
  • A list of any donations made by the city
  • A list of all vendor contracts maintained by the city
  • A list of all capital assets maintained by the city
  • A list of property owned by the city
  • A list of investments made by the city

“When you have a lack of transparency and accountability, you get into a situation where tax dollars are spent frivolously with no oversight, and regrettably, that’s what has happened in West Buechel,” Edelen said.

Richard said when the auditors first got to West Beuchel, there was nothing there for them to look through.

"There was about six months' worth of QuickBooks that had been erased," he said. "Just tons of stuff shredded ... big construction bags, and all of it was shredded.”

The city also had multiple bank accounts that the council wasn’t keeping track of. Richards said the city had bank accounts and safety deposit boxes in different banks scattered across the county, adding that there may be more that have not been discovered.

“If West Buechel can’t get its fiscal house in order, then I think the residents of West Buechel need to make a determination about whether they ought to be an incorporated city or not,” Edelen told WFPL.

For now, Richards said he is talking to the city attorney before deciding next steps. The discussions include looking at whether the city should remain incorporated.

You can read the entire report here.