‘Ghost government’ reaping hefty revenues
Nov 27, 2012 | 2804 views | 0 0 comments | 14 14 recommendations | email to a friend | print
By Alan Reed

Tribune-Courier News Editor


FRANKFORT — Special taxation districts collect as much revenue as the state’s public schools, according to the state auditor.

In a Frankfort press conference, Adam Edelen said special taxation districts have more than twice the amount of cash than all 174 Kentucky school districts have in their reserves.

In the foreword to his report, Edelen said taxation districts allowed boards to tax residents without being accountable to residents.

Edelen called it a system of ghost government and added several taxation districts in the state were not providing financial records, conducting audits or reporting activities to local governments and state reviewers.

Marshall County has 22 special taxation districts within incorporated communities and unincorporated parts of the county.

“The thing that shocked me the most that Adam Edelen told me was that some special districts in other counties were not giving budgets and audits, or making reports to their judge-executives, fiscal courts and to the Department of Local Government and State Auditor’s office,” Marshall Judge-Executive Mike Miller said.

There are 1,268 special taxation districts across the state in all 120 counties.

Examples include library boards, water districts, refuse boards, animal shelters, health departments and hospitals.

Each taxation district is governed by a board of directors appointed by local government. They must have regular, public board meetings and keep minutes of these meetings.

The board may hire an executive director to manage business and employees in the taxation district.

Some taxation districts have paid employees. Others, such as volunteer fire departments, may purchase equipment but do not have paid employees.

Districts are also compelled by law to maintain open records of minutes, payroll, purchases and other expenditures and revenues.

Most districts are governed by state statute on conduct, activities, scope and membership.

Tax bills are assessed on real and personal property values in a rate set by statute and the board of directors and approved by the county’s fiscal court, a city council or other local government.

Miller said local districts have constant oversight from his office and the county commission.

“I feel they perform a vital function in county government,” Miller said. “Some of what they do would be a headache and take up a lot of the time of the fiscal court.

“In the 38 years I’ve been judge, I’ve had no problems with the men and women who have stepped up to be leaders on our boards. We have good boards and a lot of them are volunteers.”

Miller said he maintains an open-door policy about boards. If any resident or another board member had a problem with the conduct of a board, he asked them to take their concerns to the board’s chair.

Anyone uncomfortable with that solution is welcome to bring concerns to Miller or their commissioner, Miller said.

Edelen’s report praised public libraries for their effort to provide public transparency and accountability.

“Public libraries are really one of the best returns on tax dollars that you have, “said Susan Nimersheim, chairwoman of the Kentucky Public Library Association. “This report verifies that libraries are excellent stewards of the public’s trust.”
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