Daily Independent (Ashland, KY)

August 11, 2013

A scathing audit

Edelen’s office uncovers much waste in state agency

The Independent

ASHLAND — It did not take long for the first head to roll following the release of a blistering audit of Kentucky Emergency Management Agency. Just two days after state Auditor Adam Edelen reported that his team of auditors found $5.6 million in questionable spending in recent years, Emergency Management director John Heltzel resigned.

In accepting Heltzel’s resignation, Gov. Steve Beshear made it clear that if the retired Kentucky National Guard brigadier general had not voluntarily stepped down, he would have been fired.

“The findings in the recent auditor’s report made it clear that new leadership was needed in the agency,” Beshear said, “given the numerous questions and grave concerns it raised about the proper handling of funds, reliable and transparent accounting, and appropriate work environment.”

Indeed, if the allegations in the audit are accurate, Heltzel may be just the fist of several managers to lose their jobs. The audit reveals extremely lax management and wasteful spending at the agency. While much of the blame belongs at the top, Heltzel did not act alone. Other managers of the agency disputed the auditor’s findings, which are being turned over to the U.S. Office of Homeland Security, the Kentucky attorney general’s office and the Kentucky Executive Branch Ethics Commission, and others need to be held accountable for their roles in  the mismanagement of the agency . It will largely be up to others to determine whether what further actions, including possible criminal charges, need to be taken as a result of the findings. 

KEMA is part of the state Department of Military Affairs and is best known for responding to natural disasters and other emergencies.

Edelen said his staffers who conducted the review found instances of documents being altered to hide inappropriate expenditures.

“The report paints a picture of agency leadership that does not believe the rules apply to it,” Edelen said when he released the findings. “The findings raise concerns about waste and abuse that may have gone undetected and jeopardize federal funding meant to prepare the commonwealth for emergencies.”

Heltzel’s initial response to the review was to dispute its findings. In a written response, Heltzel said  taxpayer money had not been misused and that no employees have been intimidated, though they do work in an intense environment during natural disasters. But the now departed director found few, if any, supporters among state officials.

Edelen said his staffers found spending on conferences held in 2010, 2011 and 2012 that didn’t appear reasonable or necessary. At least $103,000 in taxpayer money was spent on entertainment, including a riverboat cruise, after-hours receptions, meals, alcohol, door prizes and gifts.

The agency spent $113,000 on lunches at a Frankfort hotel between 2009 and 2013. Auditors questioned the necessity of those expenditures and noted that many of the meals exceeded the state’s maximum per day allowance.

In addition to the misspending, several employees of the agency reported being afraid to communicate with auditors on their office phones, through email, or in person at their desks because they believed their phones and offices were bugged and their emails were being read.

As auditors were wrapping up the exam, Edelen said some of the employees told the team that they were threatened with retaliation for talking with his staff, which, if true, would be a violation of the state’s whistle-blower law

“Kentuckians deserve an emergency management agency that distinguishes itself in the areas of preparedness, emergency response, and the careful stewardship of tax dollars,” Edelen said in a statement. “Today’s action begins a process of renewal.”

Beshear has appointed Mike Jones, an administrative officer in the Department of Military Affairs, as the acting emergency management director. Beshear said his first task will be to creative a corrective action plan for the agency and to implement that plan.

“The public’s trust is a sacred investment that we all must safeguard, and this change in leadership will help to restore accountability and transparency to this critical agency,” Beshear said.

The audit  is another feather in the cap for Edelen Beshear’s former chief of staff. In taking over for Crit Luallen who did a superb job during her eight years including audits that exposed much waste and led to radical changes in the Kentucky Association of Counties and the Kentucky League of Cities, Edelen had a tough act to follow. 

But after launching an investigation of the hundreds of agencies that collect taxes but have little accountability just weeks after becoming auditor, Edelen got off to a great start that brought needed changes in state law.

His latest work of exposing waste in a state agency  that has received little notice, Edelen builds on his reputation as an elected official who takes his job seriously regardless of the politics of those he is investigating.

If he keeps up the good work, Adam Edelen has a bright political future in this state.