Not long after Kentucky Auditor Adam Edelen spoke Wednesday at a legislative committee hearing about an audit of the Bluegrass Area Development District that cites the ADD for “rogue management,” the commissioner for the Kentucky Department for Local Government called those involved in the development district “honorable” individuals.

Tony Wilder spoke with members of the Barren River Area Development District at the organization’s regular meeting Wednesday afternoon.

“I don’t think anybody was out to do anything unethical or wrong,” he said of those with the Bluegrass Area Development District.

“There were some mistakes made and when you get auditors in on something, every little thing can be portrayed in a light when probably it wasn’t that way in reality.”

Wilder warned that scrutiny of the Bluegrass Area Development District likely will diffuse to other areas of the state.

“There’s going to be an assault,” he said.

After the legislative hearing Wednesday morning, Wilder said what he heard back from legislators was negative in regard to area development districts.

There was discussion of adding new regulations and oversight to the ADD structure, he said.

It’s important for ADDs to work to educate the public about what they do, Wilder said. “That’s the way that you deflect and you shield yourself against unfair criticism,” he said.

Wilder urged BRADD members to be informed about what the organization is doing and to stay together, saying that the idea of the area development districts is a brilliant idea. “That joining of public elected officials, private citizens, that in itself is a wonderful thing because that interaction, that interaction has great result,” he said. “It marries the government and private sector people and they exchange ideas, exchange knowledge and learn from that.”

BRADD Executive Director Rodney Kirtley said BRADD is working to make sure that none of the things that created issues at the Bluegrass Area Development District are a problem at the BRADD. Those efforts included recently bringing in auditors to look at BRADD finances.

“So far, everything seems to be fine,” he said.

There were instances in the past where BRADD gave what Kirtley described as “incentive pay” to employees as an alternative to raises so that BRADD wouldn’t be obligated to those salaries in future years if funding to the organization was cut, he said.

That probably last occurred in December and is no longer allowed at BRADD, Kirtley said.

One of the things noted in the audit of the Bluegrass Area Development District is that auditors discovered year-end bonuses paid to some employees “despite a prohibition against bonuses for public employees in the Kentucky Constitution.”

“Bonuses were funded with federal grants intended for specific programs and the BGADD created a fake pay period to support the bonuses,” according to a news release from the auditor’s office.

During a meeting of the Barren River Local Officials Organization after the BRADD meeting, Bowling Green Mayor Bruce Wilkerson asked that a note be added to a six-month Workforce Investment Act contract approved at the meeting that explains that it appears BRADD gave bonuses in previous years, but policy now prohibits bonuses going forward.

The BRADD’s budget and policy committee also added that note as part of the contract as approved by the BRADD on Wednesday, Wilkerson said.

The note was approved by the BRLOO.

The BRLOO also approved a change in its bylaws that makes Kirtley the administrative officer of the organization rather than executive director of the organization. 

Kirtley said the purpose of the change was to prevent the appearance of a conflict of interest existing if he serves as the executive director of BRADD and BRLOO.

“We are just making sure there is no conflict of interest,” he said.

— Follow government writer Katie Brandenburg on Twitter at twitter.com/BGDNgovtbeat or visit bgdailynews.com.