FRANKFORT — Kentuckians can expect to see much more accountability in their state government after a bill was passed and delivered to the governor’s desk last week.
House Bill 1, sponsored by House Speaker Greg Stumbo, would make it mandatory for special taxing districts, including public libraries, EMS boards, fire districts, and soil and water conservation districts, to provide more information about what is happening with the tax money they receive from the state as well as to help everyone know definitively which districts actually fall under this heading. It would also create ethics provisions to ensure the districts are acting in the best interest of the public, and give auditors the authority to make sure the districts keep up with the law.
“I’m proud we have come up with a bill that takes a huge step toward transparency and taxpayer protection while making sure these organizations can continue to provide vital services to Kentuckians,” Stumbo said.
The bill would redefine special districts as “special purpose government entities” (SPGE), which would be required to report who they are, what they do, and their finances to the state Department for Local Government. The Department would then put that data into a centralized online registry so anyone, tax payers and taxing districts alike, could see who’s who and what‘s what.
The Lexington Herald-Leader reported that the Department is expected to unveil the registry in October 2014.
After being sent to a free conference committee on Monday of last week, an agreement was reached that would also require all SPGEs submit a budget report to their local fiscal court but does not give the courts veto power over the SPGEs, as well as require a public meeting to be held prior to any changes in or adoptions of new fees or rates of an existing tax.
To pay for the new registry system, SPGEs would have to pay a maintenance and regulation fee. A spokesperson with Stumbo’s office said the bill will initially need $250,000 to start up, and $63,000 will be paid for from the general fund while the rest will come from the fees which will be determined based on the size of the district.
“This is not something that is a reaction to bad conduct [of the districts],” Stumbo said. “This is an attempt to clarify [by law] to make sure that they have a clear path as to what reporting requirements they need to make … and just a way to simplify this very complicated and convoluted series of laws that have developed in our statutes dealing with special districts over the past number of years.”
Stumbo started working on the bill with Kentucky Auditor Adam Edelen after the auditor’s office released a report in November 2012 highlighting the inadequacies of the commonwealth in giving its citizens ways to see how the over 1,200 special taxing districts in the state spend the estimated $2.7 billion in taxes annually.
The bill has been supported by numerous legislators, and passed both the Senate and the House without opposition.