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H-L: Foster leaves legacy of reform at KACo

November 17, 2009

Lexington Herald-Leader reporter Ryan Alessi offers a profile of outgoing Kentucky Association of Counties President J. Michael Foster, who has taken the lead with reform efforts following a spending scandal at the organization.

J. Michael Foster, immediate past KACo president

Foster, who is Christian County Attorney, apparently began raising questions about KACo’s spending policy after turning in a lunch receipt for reimbursement.

From the article

Foster, who ends his year as the organization’s president at its annual conference this week, used his KACo-issued Visa card last winter to pay for a business lunch, where he ordered soup.

When the longtime Christian County Attorney turned in his receipt with the names of those in attendance, he was greeted with a quizzical look from the KACo employee.

“That struck me as strange that they were surprised I was turning in a receipt with all those details on it,” he said. “So I said, ‘Let me see your credit card policy.'”

KACo had none.

Since then and amid continuing media coverage of the scandal, Foster has headed up reforms that impose better financial controls at the organization.

In a column submitted to newspapers in the state, Foster urges continued reform at the organization, but praised the steps already taken.

From Foster’s column –

That is not to say that the steps already taken by KACo are insignificant.  Under the newly adopted Code of Ethics all board members are required to affirm that they are aware of no financial interest that conflicts with their duties as board members.  Members are also required to report potential conflicts that might arise during their service on the board.

Even before the board adopted new management policies, I directed KACo’s general counsel to begin reviewing expenses and providing travel reports to the executive committee of the board.  That will soon be the responsibility of a full-time chief financial officer.

Under the new management policies, the board of directors plays a more active role in overseeing KACo’s finances.  Among other things, the policies require that member travel and other expenses be approved by the board in advance.  Per-diem caps for what can be spent on hotels and meals have been established.  Lodging and airfare are now booked by a KACo staff member accountable to the CFO.

Strict expense reporting and reimbursement policies for allowable expenses are in place.   Expenditures are directed by policy guidelines and subject to review by the CFO and the board.

Perhaps the most significant change made so far involves the use of credit cards.  The board of directors is now responsible for determining who is authorized to use credit cards and for establishing procedures governing their use.  A ban on using the cards for personal expenses has been instituted as have guidelines for receiving and purchasing gifts.  Those policies and procedures will be reviewed by the board of directors at least every three years.

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