KET Legislative Coverage

Next for Auditor's Team: N. Ky. Airport and Teacher's Pensions

by John Gregory | 06/23/14 2:03 PM

Democrat Adam Edelen ended speculation he might run for governor with the announcement last week that he would seek reelection to his post as state auditor instead. Edelen said he decided to focus on his family and coaching his young sons in baseball instead of running an all-consuming race for the state's highest office.

That decision still leaves a tremendous amount of work ahead for the 39-year-old Meade County native. Edelen joined Bill Goodman on this weekend’s edition of One to One to discuss several high-profile audits scheduled to come from his office later this year. (Their conversation was recorded on April 30.)

Edelen says he's focused on examining those areas of public spending that garner enormous taxpayer investment but that have historically received little oversight. His office of 110 investigators recently completed the largest audit ever conducted in state history: a review of the Jefferson County Public School System. Edelen describes the district as the second largest government entity in the commonwealth, with a budget of slightly more than a billion dollars.

Schools and Teacher Retirement
Edelen says his emphasis on school audits stems from his belief in the importance of education. "When school districts are doing more with less, we've got to make sure what few resources we have are actually getting to the classroom where they can affect student performance," Edelen says.

While Edelen's office suggested some management changes to the Jefferson County system, auditors found no wrong-doing. Other Kentucky districts have not been so fortunate: The superintendent of the Mason County schools retired in 2012 after auditors uncovered some $200,000 in inappropriate spending. Earlier this year, a superintendent for a small northern Kentucky school district received a two-year prison sentence after auditors found he embezzled a quarter of a million dollars.

Another looming issue for education in the commonwealth is the teacher pensions. Edelen says about 15,000 teachers - roughly one in four currently working educators - will be eligible for retirement in the near future. Given the demands this will place on the Kentucky Teachers' Retirement System, Edelen's office is reviewing the pension plan to assess its solvency. While the full audit won't be released until the end of the year, Edelen says he plans to present what he calls a "mid-course review" to the public this summer so legislators can begin dealing with the unfunded liability in that system.

Airport Mismanagement?
Another high-profile audit involves the Cincinnati/Northern Kentucky Airport. Edelen says the facility once handled 600 flights a day, serving many national and international destinations. Now the airport has fewer than 150 daily flights. Many believe this decline contributed to Toyota's decision to move its manufacturing and engineering offices in Erlanger to Texas. Edelen believes the airport's troubles stem in large part from political infighting, ineffective leadership, and questionable spending by its board. He says the audit will also review cultural and structural issues that affect how the airport board operates.

Edelen sees his office as the last line of defense against true corruption. While some public officials actively seek to enrich their own positions, Edelen says many audits reveal less nefarious activities involving poor judgment and bad financial decision-making.

"Kentucky is a poor state, and a poor state doesn't have the luxury of making dumb decisions," Edelen says. "And when we tolerate inefficiency or corruption or, worse than all of that, we permit a culture of low expectations, we get precisely what we don't deserve."

Watch the full One to One conversation with Kentucky Auditor Adam Edelen.