FRANKFORT, Ky. — As legislation that would strengthen oversight of state contracts faces a court challenge, a legislative committee met this week to consider almost $350 million in personal service contracts issued by the executive branch.
“Unfortunately, the sheer amount spent on personal service contracts is evidenced enough of the need for greater oversight and at minimum another set of eyes. The Government Contract Review Committee is responsible for determining whether or not the contracts issued by the state are necessary and appropriate, but without HB 388 we have very little authority to stop even the most obvious abuses of the system,” explained Representative Matt Koch, Co-Chair of the Committee.
The General Assembly passed HB 388 during the 2022 Regular Session. The measure, HB 388 would authorize the state treasurer to make the final decision on state contracts disapproved by the Government Contract Review Committee. Until the court challenge is settled, the ultimate approval of personal service contracts, tax incentive agreements, and memoranda agreements falls in the hands of the Secretary of the Finance and Administration Cabinet.
During Tuesday’s committee meeting, members voted to approve a variety of contracts ranging from economic development to behavioral health services. Presenters from the Department of Behavioral Health Developmental and Intellectual Disabilities shared that securing full-time staffing for psychiatric hospitals continues to be a challenge. The Department oversees Central State Hospital, Glasgow State Nursing Facility, Kentucky Correctional Psychiatric Center, Western State Hospital, and Western State Nursing Facility.
Committee members also heard from the Department of Public Health. The presenter discussed a federal grant to provide funds for the development of a regional training facility for infection prevention and control education. The facility will allow for hands-on training as well as webinars. The presenter indicated that the training would include the prevention and control of all infectious diseases.
However, members deferred a vote on a $51,761,344.40 contract that provides funding for third-party administration of the Commonwealth’s self-insured Workers Compensation Program. In postponing their decision, lawmakers requested clarification about how another measure passed this session, SB 42, would impact the proposal. SB 42 prevents state contracts from going to companies for five years after their lobbyists are convicted of crimes related to prior state contracts.
This week’s meeting comes just days after Kentucky State Treasurer Allison Ball made public a request by the Beshear Administration to allow payment to go through on 3,688 vehicle tax refund checks that were mailed to incorrect recipients. According to a press release issued by Treasurer Allison Ball’s Office, the Beshear Administration notified the Treasury that the Finance Cabinet made an error by sending vehicle tax refunds to incorrect individuals. Upon learning this information, the Treasurer notified the administration of her intent to cancel the checks and waive cancelation fees.
“Oversight is critical to ensuring that state government acts as effectively and efficiently as possible. This was one instance of a costly mistake that was caught simply by having another duly-elected executive branch official watching over the state’s resources,” Koch added. “The system clearly needs checks and balances between and within the three branches of government.”
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