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Ethics Deformed

The Contrast

  When comparing the two Ethics Proposals, clear differences are notable. The proposal sponsored by Councilman Ken Fleming (Rep.- 7th Dist.), and co-sponsored by David Tandy (Dem.- 4th Dist.), has more definitions, clear and precise wording that deals with each aspect of the proposed legislation. The proposal sponsored by Councilwoman Marianne Butler (Dem.- 15th Dist.) and co-sponsored by former Commonwealth Senator, current Councilman, Jon Ackerson (Rep.- 18th Dist.), has various phrases missing, entire definitions excluded, and subverts the intent of anonymous reporting and even protects certain aspects of government workers, agencies, and contractors of the Metro Government. How did we get to this division, and why is the division between the two proposals dealing with the topic of ethics? Who are the major supporters of the two proposals? Though not all questions can be adequately answered in one brief report, it is necessary to discuss the genesis of the two proposals.


  The issue never really began with a proposal. Though research was available, and common sense alone was enough to ascertain that Metro Louisville was in need of a clear Ethics Ordinance, the proposal by Ken Fleming was not technically the genesis of the debate. The Ethics Ordinance proposal was prompted by two reports from two audits from two different sources.

  One was from the Louisville Metro Government’s Office of Internal Audit on the Ethics Program and was filed in August 2008, and was written by Mr. Michael S. Norman, The Chief Audit Executive in the Office of Internal Audit. After doing an audit, Mr. Norman reported his findings, and sent the findings to Mayor Jerry Abramson, Louisville Metro Council Government Accountability and Audit Committee, the Director of Human Resources, and Louisville Metro External Auditors.

  The second report was from the office of the Commonwealth Auditor of Public Accounts, compiled by Crit Luallen, the Auditor of Public Accounts, and sent to Mayor Jerry Abramson and the “Louisville/Jefferson County Metro Government”. This report was entitled “Report Of The Audit Of The Louisville/Jefferson County Metro Government Department Of Housing And Family Services” and was for the fiscal year that ended on June 30, 2008.

  The report from Crit Luallen begins with some statements that not only sums up much of the report, but also struck to the issue, as well as labeling a problem that many in Metro Government, as well as the citizens of Metro Louisville, believe has existed, and exists today.

  “Because policies and procedures were often not followed or possibly did not exist, questionable transactions, many of which included management override, occurred resulting in a high level of audit risk. Additionally, management of the Department recorded or caused to be recorded voluminous transactions through the use of journal vouchers, resulting in millions of dollars in expenditures, most notably payroll being moved from one cost center to another, one department to another or one fund to another without adequate supporting documentation to justify the transfer.”

  In a statement under the title “Report On Internal Control Over Financial Reporting And On Compliance And Other Matters Based On An Audit Of Financial Statements Performed In Accordance With Governing Auditing Standards the report states that “we identified certain deficiencies in internal control over financial reporting that we consider to be significant deficiencies.”

  How did these “deficiencies” occur; what is the basis of them? “A control deficiency exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis.”

   For these reasons, the Council began, and has recently concluded seeking to limit the ability to give, and forgive loans, as well as hide various expenditures of public funds from the knowledge and approval of the Louisville Metro Council and the public. This accountability has been identified as transparency when dealing with funds.

  After Mayor Jerry Abramson’s recent forgiveness of a $7,000,000 loan to the Phoenix Place Apartments, and the various issues that the administration has attempted to hide dealing with the Cordish Group, council members Hal Heiner, Kelly Downard, and Tina Ward-Pugh sponsored an amendment that basically informed the mayor’s office that any amount over $150,000 must be approved by the Louisville Metro Council filed sixty days previous to the occurrence. This amendment passed by majority vote through Metro Council. The mayor’s actions with Phoenix Place Apartments so disturbed various council members that talk of a letter being sent from the Metro Council, signed by various members of the council, and sent to the mayor was prompted. Therealville has attempted to gain further information regarding this letter, but has yet to receive an informed reply regarding the request.


  Even more imperative to the Ethics Ordinance proposal initiated by Ken Fleming is the Report from the Office of Internal Audit, which, in summary, states that “Louisville Metro’s Ethics Program does not meet all the requirements of an effective ethics program.” (page 3).

  After their audit, the office determined that Louisville’s Ethics Program was in need of improvement. Within the report itself such statements as the following exists:

  • “Louisville Metro’s Ethics Program does not meet all of the requirements of an effective ethics program. Therefore, it needs improvement. Several opportunities were noted to enhance the effectiveness of Louisville Metro’s Ethics Program.”
  • “There should be one comprehensive Ethics Program for Louisville Metro Government.”
  • “A comprehensive Ethics Program includes one code of ethics for all employees.”
  • “The Ethics Officer should have direct and independent access to the executive level (e.g., Mayor).”
  • “Employee inquiries and allegations should be treated in confidence and responded to promptly.”
  • “Employees should be free to report possible violations without fear of retribution.”


  Some of the recommendations put forth by the Office of Internal Audit has been assisted, if not fulfilled by legislation other than the Ethics Ordinance proposal. For example, the Anonymous Tip Line Ordinance sponsored by Kevin Kramer (Rep.- 11th Dist.) and co-sponsored by a bipartisan group of various council members set up a tip line that allows various Metro employees and citizens to anonymously report issues and possible ethics violations.

  What has not been set forth by current legislation, yet still meets the recommendations of the audit report, is contained in only one of the two proposals. The proposal set forth by Ken Fleming and David Tandy is that proposal.

May 7, 2009 - Posted by | Proposed Ordinances, Series Issue | , , , , , , , , , , , , , ,

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