Kentucky Auditor of Public Accounts Mike Harmon released information last week in regard to a special examination of the Kentucky Fire Commission and the Kentucky Firefighters Foundation Program Fund (KFFPF). The examination resulted in six findings, according to Harmon's report.
The special examination was the result of Harmon's 2016 audit of the
Kentucky Law Enforcement Foundation Program (KLEFPF). Several
legislators requested a similar exam of KFFPA.
"Among the six findings is one also cited in our special examination
of KLEFPF noting that an increase in the insurance surcharge to fund
KFFPF did not follow state law requirements. By not following state
law, there was no way to determine what surcharge rate was
necessary," said Harmon. "In addition, we also found some examples of
what could be considered wasteful spending that is not in line with
what KFFPF is designated for."
The KFFPF funding comes from a surcharge tax on casualty and
property insurance premiums paid by Kentuckians. KFFPF receives all
funding generated by the surcharge from insurance companies based in
Kentucky, and 28 percent of funds that come from insurance companies
based outside the state.
According to the law that established KFFPF in 1980, the monies
generated by the surcharge are to be used for strengthening fire
protection by attracting highly qualified men and women to become
firefighters, retaining them through an annual funding supplement,
and ongoing education and training.
Among the questionable expenditures cited in the auditor's special
examination are:
• $150,000 for an annual Firefighter Combat Challenge between July
2014 and March 2017, which included hotel and meals for Fire
Commission employees and entry fees in 2015 and 2016 for Kentucky
fire departments to attend the World Combat Challenge. Auditors found
less than two percent of fire departments in the state sent a team to
participate in the challenge.
• $51,000 in KFFPF funds were spent between July 2014 and March 2017
for Fire Commission employees, honor guards and families of
firefighters to attend the National Firefighter Memorial Weekend in
Maryland, including nearly $22,000 on chartered buses, over $26,000
in lodging and $1,800 for snacks and drinks.
• More than $1,800 in KFFPF funds spent on chili ingredients for a
Kentucky Community and Technical College System (KCTCS) charitable
fundraiser. KCTCS provides oversight to the Kentucky Fire Commission
on training and education programs for firefighters.
• $3,000 on a special event baseball sponsorship promoting emergency
services.
• $540 to cater a KCTCS annual area meeting for 45 attendees.
"While we recognize the goodwill shown by the Fire Commission to
honor firefighters who gave the ultimate sacrifice, and their
families, these expenses do not fall within the areas specified in
statute for use of KFFPF funds," said Harmon. "It would be more
appropriate for expenses to attend a memorial weekend to be paid by a
non-profit foundation rather than improperly using taxpayer dollars
that are subject to specific restrictions designated by the General
Assembly."
The insurance surcharge generated more than $42.4 million for the
KFFPF funding in fiscal year 2015 and $44.2 million in fiscal year
2016. Roughly $39.7 million of the Fire Commission's funds were swept
into Kentucky's General Fund between 2013 and 2016. Harmon's
examination of the Law Enforcement Foundation Program Fund found that
an additional $56 million in KLEFPF funds were swept into the General
Fund during that same period.
The full report can be viewed at the auditor's website.
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