King Seeks Legal Advice, Requests New Audit on Council Purchases

by admin on May 19, 2011

Responding to the recent controversy surrounding gift card purchases made by city lawmakers, Louisville Metro Council President Jim King, D-10, has requested a formal opinion from the Jefferson County Attorney’s office to make sure those expenditures are legal.

The request was made in a letter to County Attorney Mike O’Connell Thursday. King is asking for  an opinion on the legality of spending taxpayer dollars on food and drink used at public meetings, using city-funded debit cards for constituents to “promote goodwill” and buying banquet tickets used by council members if the banquet is a public meeting.

“There have been many questions raised recently about the business operations of the Metro Council,” says King. “I would like to make sure that what we are doing is legal and what changes are needed in how we process our operations.”

Different media outlets have revealed that council members spent thousands of taxpayer dollars on dozens of questionable purchases, including prizes for constituents at parties and neighborhood festivals using gift cards bought from their office accounts.

Outside experts have likened the practice to “handing out cash” and Republican lawmakers have voiced concerned as well. Many council Democrats, however, have defended the use of gift cards, saying it is allowed by the body’s policies and procedures.

King is also calling on the city’s internal auditor to inspect office expenditures, including all Kroger gift card purchases for the last three fiscal years. Under the current system, Kroger cards are purchased through a charge account that each member has with the grocery store chain.

However, receipts for those purchases were often sent to the council member’s district office instead of the council’s business office, which is charged with keeping track of the expenditures before forwarding them to the finance department. In many cases, the card purchases were not tracked properly, did not show who received them or what was bought with the cards even in instances of personal use by council members and their legislative aides, who were later reimbursed.

Citing that a previous audit failed to review all the gift card accounts, King says it is time the council correct any errors and has asked the Office of Management and Budget for assistance in reviewing the council’s accounting system.

“This is a fundamental flaw in our accounting system…it allows the district offices to make purchases on the credit cards (and personal payments) outside the review of the business office ” King writes in his letter to O’Connell. “Further, the audit also failed to report that the personal use of the credit card is allowed. This is a fundamental weakness.”

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