State Auditor Mike Harmon’s office will conduct a “special examination” of the Beshear administration’s handling of disaster relief funds at the request of a legislative committee.
The focus of the audit will be the Public Protection Cabinet’s administration of the Team Western Kentucky Tornado Relief Fund and the Team Eastern Kentucky Flood Relief Fund, a Thursday news release from the Office of the Auditor of Public Accounts said.
Democratic Gov. Andy Beshear responded by defending his administration’s handling of the donated money as the “most transparent disaster recovery funds that I’ve ever seen.” Beshear called the audit’s timing “grossly political.”
The co-chairs of the Legislative Oversight and Investigations Committee, Rep. Adam Bowling (R-Middlesboro) and Sen. Brandon Storm (R-London), wrote in a letter requesting a review earlier this week that more than 200 checks were “issued from these funds to persons who did not request the monies or who have later stated no objective need.”
“As a result,” the lawmakers’ letter said, “the Committee has serious concerns about the due diligence and general oversight of the funds. There is a lack of transparency surrounding the solicitation, administration, and procurement rules regarding these funds, including but not limited to the establishment of objective criteria for the disbursement and subsequent disbursement.
“In addition, testimony provided at legislative hearings suggests that the Executive Branch did not seek any formal opinions regarding the ethical parameters for such solicitations or register under appropriate federal guidelines.”
In his weekly news conference, Beshear questioned the timing of the audit with a governor’s election on the line and asserted the review will not be impartial, given that Harmon was one of a dozen Republican candidates seeking to unseat Beshear a few months ago and now supports Republican nominee Attorney General Daniel Cameron, Beshear’s opponent.
“Listen, for somebody who was running for governor that is supporting the other candidate to announce an audit on something like this three months and two weeks before an election, we all have to admit that’s grossly political, and we shouldn’t be doing it,” Beshear said.
He said records have been made available to the public and members of his administration have testified in front of lawmakers numerous times. The governor said attacking “something like this for politics is really wrong,” and that dollars from the funds have supported rebuilding homes, paying for funerals and other services.
“Anybody who got one of those payments, who’s moving into one of these homes, ought to be upset that people would bring politics into this,” the governor added.
When asked about the lawmakers’ concern about the lack of an ethics opinion regarding the funds, Beshear said the law does not require one.
Because he was a candidate for governor, Harmon is recused from the relief funds examination, a spokesman for his office said. Measures have been taken to recuse Harmon from any examinations or audits regarding the executive branch.
The auditor’s office said its examination will cover the period between Dec. 11, 2021 and June 30, 2023.
After the examination is concluded, the office will issue a report to the Public Protection Cabinet identifying weakness and offer recommendations to improve controls and procedures, according to a response letter signed by Assistant Auditor of Public Accounts Farrah Petter. The cabinet will be legally required to respond to the Auditor’s Office and the General Assembly with a “corrective action plan.”
Petter’s letter also says the auditor’s office will bill the cabinet and not the relief funds “so that the people of the Commonwealth can be assured that no money donated for flood or tornado relief will be used to pay for the special examination.” The hourly rate is $84 per hour as well as travel costs. A preliminary estimate will be available at a later date.
Following the 2021 tornadoes, more than $52 million in donations poured into the Team Western Kentucky Tornado Relief Fund. Some ways the dollars have been spent include paying for funeral expenses, new housing and giving $1,000 checks.
The Beshear administration’s handling of the relief funds came in for criticism during this year’s legislative session after media reports of checks being sent to the wrong people,
The Lexington Herald-Leader reported the Kentucky Treasury canceled checks meant to go to tornado victims after learning some recipients were not affected by the storms. The newspaper said the Cabinet had issued about 10,040 checks, which equated to more than $10 million, from the tornado relief fund.
The newspaper reported Thursday that the Treasury had canceled more than 200 checks and that Beshear previously said fewer than 20 were the result of possible fraud and 26 had been returned with an explanation that did not necessarily indicate fraud. Those instances were referred to FEMA.
The Kentucky Lantern reported in February that relief funds remained unspent in some counties, despite the needs of survivors.
The Republican-controlled General Assembly passed a law sharpening oversight of relief funds, which Beshear signed.