Candidates for Commissioner of Agriculture, Auditor of Public Accounts, and State Treasurer

By John Gregory | 10/01/19 7:00 AM

Candidates competing in the races for Kentucky Commissioner of Agriculture as well as State Auditor and Treasurer appeared on KET’s Kentucky Tonight.

This was the first in a series of discussions with candidates running for statewide constitutional offices the 2019 election season.

Agriculture Commissioner candidates Ryan Quarles and Robert Haley Conway discussed their priorities for the office as well as hemp, medical marijuana, and other issues.

Auditor of Public Accounts candidates Mike Harmon, Sheri Donahue, and Kyle Hugenberg talked about their visions for the office and how the public pension systems should be audited.

Treasurer candidates Allison Ball and Michael Bowman talked about the obligations of the job as well as their views on economic incentives, teacher pensions, and tax reform.

 

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Candidates for Commissioner of Agriculture

Incumbent Republican Ryan Quarles grew up on his family’s tobacco and cattle farm in Scott County. He has degrees from the University of Kentucky, Harvard, and Vanderbilt. Quarles spent two summers working in Sen. Mitch McConnell’s office on the tobacco buy-out bill. He was elected a state representative in 2010 and Agriculture Commissioner in 2015.

Democrat Robert Haley Conway is an eighth generation farmer from Georgetown. A graduate of the University of Kentucky, he served 12 years on the Scott County Board of Education, including two years as chair. He is also a member of the county’s soil and water conservation board. Conway farms with his son and manages a transportation company.

Priorities for the Commissioner’s Office

In a second term, Quarles says he would continue to support small farmers, further expand the Kentucky Proud marketing program and the state’s hemp efforts, explore new agriculture technology options, and foster international trade agreements. The commissioner acknowledges that Kentucky farmers have been hurt by President Donald Trump’s trade disputes with China and other countries, but he contends Kentuckians have fared better than producers in other states.

“Despite the commodity crisis, despite issues with trade right now, we have insulated ourselves,” says Quarles. “We’ve done a lot better than our friends in the Midwest because we are focused on small family farms here in Kentucky.”

Quarles says he believes the president’s trade negotiators will ultimately reach international agreements that will benefit Kentucky farmers, who he says prefer trade to government aid.

Conway says he entered the race to protect family farms, which he says are disappearing from the state at a rate of 1,000 per year. He fears large-scale corporate farm operations are edging out smaller, more diverse family-based growers and producers. But even large operators are suffering as well, he says, despite recent farm relief measures approved by Congress.

“In 2001 it cost $200 to raise an acre of corn. This year it cost $700 and the price of corn is less than what it was then,” says Conway. “Right now the only thing that’s keeping the big ones alive is the lifeline thrown to them by federal government.”

Trade wars and market forces are likely to bring more stress and pain to Kentucky farmers in the coming months, according to Conway. He says growers and producers are “fearful for the future.”

Marijuana and Hemp

Conway advocates legalization of medical marijuana, saying it could alleviate the suffering of cancer patients and those overcoming addiction. The Democrat says he considers medicinal use of marijuana to be a moral issue, not a political issue.

“Why would you not want to do something that would make someone’s life a little bit better, a little less painful, a little more tolerable?” Conway asks.

Quarles says he does not oppose medical marijuana, but he says it’s an issue for legislators and doctors to decide. He says his agency is fully committed to expanding the market for industrial hemp, which the 2018 federal Farm Bill legalized. The Republican says Kentucky is now a national model for hemp production.

“We have 1,000 farmers growing [hemp], up 500 percent from last year,” says Quarles. “We don’t have the bandwidth right now to deal with anything beyond hemp – it is such a Goliath in our office.”

Although he also supports hemp, Conway says it should not be the sole focus of the Department of Agriculture. He also wants hemp production to be modeled on the old tobacco quota system so that large- and small-scale growers have an equal opportunity to make money off the crop.

Other Issues

More than 8,600 farmers now participate in the Kentucky Proud marketing program, according to Quarles. The effort has expanded beyond promoting locally grown meats, produce, and fruits to now include a range of goods from sod and compost to beverages, bottled sauces, crafts, and farm equipment. Quarles says the program, which was started by former Commissioner Billy Ray Smith, sells more than $500 million in merchandise every year.

“We’re using Kentucky Proud to help connect a consumer that may not know where their food comes from with the farmer,” says Quarles. “Is it perfect? No… but we believe that we are serving Kentucky farmers, large and small.”

As Kentucky Proud has become more diversified, Conway contends the program has become more corporate-focused and has left small farmers behind. The Democrat also questions the hunger initiative that Quarles launched in his first term. He says it’s hypocritical for the commissioner to say he’s addressing food insecurity among Kentuckians while also supporting GOP efforts to reduce the number of people who receive aid from the federal Supplemental Nutrition Assistance Program.

“His hunger initiative is not going to take care of the hundreds of thousands of Kentucky children and people that are going to be loosing their food stamps here very shortly under the auspices of (U.S. Secretary of Agriculture] Sonny Perdue and the Republican policies established in Washington,” says Conway.

Quarles says his hunger initiative connects food-insecure Kentuckians with farmers in the Kentucky Proud program. He says it’s not hypocritical to want to help those who are less fortunate help themselves.

Candidates for Auditor of Public Accounts

Incumbent Republican Mike Harmon is from Danville and a graduate of Eastern Kentucky University, where he majored in math, statistics, and theater. He worked in banking and insurance, and won a seat in the state House of Representatives in 2002, serving as vice chair of the tourism and energy committee. He was elected Auditor in 2015.

Democrat Sheri Donahue grew up in central Kentucky and received an industrial engineering degree from Purdue University. For 20 years she audited weapons systems projects and managed classified intelligence contracts for the U.S. Navy. Donahue also worked on intelligence projects for the FBI and cybersecurity for Humana.

Libertarian Kyle Hugenberg of Louisville holds a bachelor’s degree in accounting from the University of Cincinnati and a master’s from the University of Louisville. He is a certified internal auditor, credentialed by The Institute of Internal Auditors. Hugenberg has worked in the financial services, healthcare, manufacturing, and payment processing industries.

Priorities for the Auditor’s Office

If re-elected, Harmon says he would continue to find, confirm, and report important data that his office investigates. He notes that he was the first auditor to review the books of the Administrative Office of the Courts and the Kentucky Law Enforcement Foundation Program Fund. Harmon also says his office has referred more than 68 cases to the state Attorney General as well as the FBI, IRS, and ethics boards for further action.

“We do have subpoena power but we don’t have prosecutorial power,” says Harmon. “It’s important for us not to target anyone, it’s important for us not to give anybody a pass, but just simply follow the data.”

Donahue says her goal as auditor would be to root out waste, fraud, and abuse and help restore people’s faith in their government. She says she wants to focus on auditing the economic incentive packages that state officials offer private businesses looking to locate or expand operations in the commonwealth.

“Are these companies holding up their end of the deal?” says Donahue. “Are they bringing the jobs they’re promising? Are they bringing the quality jobs when they do?… We need an auditor that is going to go out and research those things.”

The Democrat also pledges to use her engineering background to evaluate office operations and improve cybersecurity as well as the auditing processes.

Hugenberg describes himself “the independent outsider” who will dig into state finances and find the Republicans and Democrats who he says enrich themselves and their friends at taxpayer expense. The Libertarian says one of his first priorities would be to audit the hundreds of entities around the state that have taxing authority.

“And evaluate them the same we evaluate a private charity,” Hugenberg says. “We’d say, how much money are these groups collecting, and then how much are they actually spending on the cause that they’re supposed to be spending it on.”

Hugenberg says he would recommend that the taxing entities that improperly use their resources be dissolved. He also wants more people found to be wasting public funds to be held accountable for their actions.

State Planes and Public Pensions

Critics of Republican Gov. Matt Bevin have questioned his use of state-owned aircraft for government business as well as personal and campaign-related flights. The governor recently released details about many but not all of his trips. Donahue says she would audit Bevin’s travel to make sure taxpayers are properly compensated for flights not related to state business.

Harmon says Bevin’s use of state aircraft is “something we could look at,” but he also says he must prioritize the work done by his office due to staff limitations. He says many audits he conducts are required by state statute.

The state Auditor is also a non-voting member of the Public Pension Oversight Board. Harmon says he will continue to push for more transparency in how the state’s retirement plans are managed, especially the expenses charged by investment fund managers.

“That’s important for us to know the fees,” says Harmon. “If a lot of those fees are not properly being disclosed, then we don’t know where the profits are being eat up at.”

Donahue and Harmon agree that public employees and retirees deserve the benefits they’ve been promised. But Donahue criticizes Harmon for not conducting a performance audit of the pension plans, as she says he pledged to do during his 2015 campaign for Auditor. Harmon says that became unnecessary because the Bevin Administration hired its own accounting firm to conduct that review. Harmon says it would be a waste of state money to duplicate that work.

Harmon’s office did release an audit of the Kentucky Retirement Systems earlier this year. Donahue describes that review as “very superficial” and argues that a more rigorous performance audit of the pension plans is still needed even if the governor’s office already did one.

“The auditor’s office must be an independent entity,” Donahue says. “Relying on something that is done by another entity with a vested interest is irresponsible.”

Hugenberg says it’s pointless to argue over who does which audit, or what pension data is publicly disclosed. He contends the real problem is that lawmakers don’t want to raise taxes high enough to pay for the pension benefits owed to public employees and teachers.

“Eventually it’s going to come due,” says Hugenberg. “There’s nothing they can do about it unless you’re going to have a significant increase on taxpayers in the future, or some sort of significant austerity measure… or simply these teachers aren’t ever going to have these retirement benefits. It’s as simple as that.”

Candidates for Treasurer

Incumbent Republican Allison Ball is from Floyd County and a graduate of the University of Kentucky College of Law. She was a bankruptcy attorney in Prestonsburg, focusing on consumer rights and commercial litigation. Ball also prosecuted child abuse cases while serving as Assistant Floyd County Attorney. She was elected state Treasurer in 2015.

Democrat Michael Bowman was raised in the Valley Station neighborhood of Jefferson County and attended the University of Louisville. For seven years he was a legislative assistant for the Louisville Metro Council. Bowman is now a bank officer and branch manager for US Bank, where he manages a multi-million financial portfolio.

The Purview of Treasurer

The Kentucky Constitution calls for a State Treasurer, but some lawmakers have proposed abolishing the office and folding those duties into the Kentucky Finance and Administration Cabinet. Both Ball and Bowman say the office should remain an independent entity.

“It is the watchdog over taxpayer dollars,” says Ball. “If you’re elected, you care about doing that a greater level. You really are responsible to the people about doing that work.”

Ball says she ensures that the checks coming out of her office are correct as well as legal and constitutional. She touts her work to stop fraud, improve transparency, and promote financial literacy. She also created a tax-free savings plan for people with disabilities called the STABLE program.

Bowman agrees that the job is critical for the commonwealth.

“The treasurer is intended to be the stopgap between what would be a reckless governor and your tax dollars,” says Bowman. “That’s the reason I am in this race, to bring that accountability back to Frankfort.”

The Democrat says he would be more outspoken about state investments that lack proper transparency or financial evaluation. As an example, Bowman points to a failed battery manufacturing plant in Pikeville that was due to receive $30 million in tax incentives and a $6 million grant from the state. He also points out how lawmakers approved a $15 million appropriation for an aluminum rolling mill to be built by Braidy Industries without knowing the details of that investment.

Bowman says he would follow the law, but he also argues that the Treasurer has a moral obligation to publicly question such deals.

“Because that prevents us from getting into issues where our tax dollars are being abused and being misused,” says Bowman, “where we have to have an auditor go back and check after the fact constantly to find the problems when we could’ve been more proactive from the very beginning.”

Ball says economic incentives like the one offered to Braidy Industries are a common practice in state government. She says it’s not the job of Treasurer to review or comment on those incentive packages.

“The General Assembly voted to send over certain dollars to Braidy, and that’s within their purview,” says Ball. “If I say no to that then I’m stepping out of my lane and doing something I’m not supposed to do. That would be taking my role and making it an activist role in a way that would be illegal.”

Teacher Pensions

The Treasurer sits on several state boards, including the board of the Kentucky Teachers’ Retirement System. Ball says she wants to ensure that the actuarially required contribution (or ARC) is fully funded by the state, and that the actuarial assumptions that govern financial management of the plan are sound.

The Republican also says the state must adhere to the inviolable contract for people already in KTRS, but she says lawmakers could explore benefit changes for new hires as a way to improve the long-term solvency of the system.

Bowman says his top priority would be review the fees charged by hedge fund managers that oversee KTRS investments. The Democrat says his banking and financial background would enable him to ask the right questions and ensure the pension plan is getting proper investment returns.

Tax Reform

Although the Treasurer has no formal roll in setting tax policy, both candidates say the state does need more revenue, but they have very different approaches about how to generate it.

“I would push on doing it through job creation,” says Ball. “Whenever you have more jobs, you always have more revenue, and that has added benefit, too, because it puts more money into people’s pockets.”

Ball says she supports a simpler tax code, but urges caution against taxing too many service providers, including realtors and attorneys.

Bowman advocates for legalizing medicinal and recreational marijuana as potential sources of new revenue. He also says decriminalization of marijuana possession would save the at least $55 million a year in court and incarceration costs.

“There are a lot of things that Kentucky can do today that would make us business competitive but also not put the burden on the backs of our already hard-working families,” he says.

Bowman also says tax dollars should not be taken from public schools to fund charter schools. Ball says she supports a scholarship tax credit, which would give individuals and corporations a deduction on their state taxes for donating to non-profit organizations that provide scholarships to students who want to attend a private school.