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Here's How Much Louisville Officials Spend On Derby Guests

Louisville's Metro Hall was aglow on Derby eve.

The floor of the airy rotunda flickered with fluorescent lights. The walls were bathed in a soft pink hue.

A hundred or so people gathered in the building for a post-race party. Music played, bartenders poured bonded bourbon and a chef worked quickly to prepare the evening meal.

Among the crowd were sailors, city officials and an untold number of special guests who experience the Derby and accompanying glitz largely at the expense of taxpayers.

But those taxpayers aren't privy to the identity of these guests.

Each year, Louisville Mayor Greg Fischer and top city officials extend Derby invitations to a handful of prospective economic development investors -- corporate heads, startup founders and entrepreneurs.

The effort is an all-hands-on-deck courtship of potential clients who could possibly bring jobs or development to Louisville.

And each year, Fischer spends thousands of taxpayer dollars playing host to those guests.

But a spokesman for Fischer declined to provide a guest list of the party's attendees. Such guests are potential economic development targets and disclosing their identity could hurt investment opportunities, said spokesman Chris Poynter.

Transparency advocates and ethics experts scoff at the secrecy.

"It doesn't sound like Mayor Fischer," said Richard Beliles, head of the Kentucky chapter of Common Cause, a national watchdog group.

Beliles said the use of public funds by public officials is certainly within the public's interest -- even when they're used to pay for a private party.

"It sounds like we're talking about the White House and Donald Trump," he said.

VIP Treatment

Louisville Metro government has picked up the tab for entertaining city-sponsored Derby guests since 2015, according to a response to an open records request. Prior to then, such expenses were covered by Greater Louisville Inc., the metro area's chamber of commerce and former economic development engine for local city government.

In the past three years, city officials have spent nearly $282,000 to house, transport, feed and photograph their Derby guests, city records show. This includes nearly $140,000 in track tickets and more than $118,000 in hotel expenses, records show.

Additionally, city officials spent $15,000 shuttling guests around the city, and hundreds more on locally sourced name tags, gifts and sweets, the records show.

Mary Ellen Wiederwohl, the chief economic development officer, said it's money well spent.

"The return is incredible," she said in an interview Monday.

Wiederwohl said her counterparts in other cities "salivate" over the Derby and the opportunity it affords to showcase the city.

She declined to name specific companies that have relocated to or invested in Louisville as a result of attending a city-sponsored Derby event. But she was quick to note that a "significant percentage" of past guests are presently operating in the city.

Wiederwohl said the reason for keeping Derby guests secret is multifaceted. Disclosing such information could tip off competitors, it could influence financing options or even affect a company's stock if word slips it's eyeing an expansion or investment in Louisville.

In fact, she said some guests come to the Derby under an alias and take extra steps to hide their identity.

Worth the Investment?

On Friday, the day before the Derby, the metal detector just inside the front door of Metro Hall had been replaced with a pink carpet.

Fresh clusters of pink flowers adorned the foyer and a marble effigy of Henry Clay -- installed in 1867 -- was clad in a white top hat with a matching necktie.

The building is nearly 160 years old. The architect envisioned the Greek Revival structure would one day serve as the state's capital building. These days, Metro Hall is home base for Mayor Fischer and houses an array of city services.

The party buzzed Friday evening as the rain tapered off and the sun shined a moment on downtown Louisville. Inside Metro Hall, guests chatted around cocktail tables. Some lifted their slacks to compare socks, while others posed for pictures with Fischer.

Metro Councilwoman Angela Leet wasn't there. She didn't get an invitation.

Leet, a Republican from District 7, was a bit surprised that the details of a publicly funded event attended by public officials in a public building are kept secret.

She said some level of confidentiality could be warranted when it comes to prospective business interests. Such potential exemptions, however, are no reason to avoid transparency, she said.

What's more, Leet wants to see proof such events are worth the cost.

"Whether you've gotten your money out of the investment," she said, "instead of it just going down a toilet bowl."

Beliles, the ethics expert, said a key element of government spending is transparency. Keeping the public in the know about how public money is spent and who it is spent on is, generally, a good thing, he said.

"Even for this," Beliles said.

Jacob Ryan is the managing editor of the Kentucky Center for Investigative reporting. He's an award-winning investigative reporter who joined LPM in 2014. Email Jacob at jryan@lpm.org.

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