Following an early misappropriation and financial snafu, it turns out the Team Western Kentucky Tornado Relief Fund was, for the most part, properly administered and allocated to those desperately in need — and with less than six-tenths percent in error.
That’s according to a special examination and audit from the office of State Auditor Mike Harmon — who on Tuesday afternoon released more than 40 pages of findings.
Among the highlights:
*Harmon said more than 200 checks issued from the fund went to Kentuckians who either didn’t request the monies, or said they didn’t have a need for the funds.
This accounted for nearly $240,000 of the $42.3 million expended — a mistake of 0.57%.
*Auditors also found these misguided efforts included duplicate payments, payments to those later deemed ineligible and overpayments. Furthermore, these payments mostly stemmed from the $1,000 “Second Assistance Payments,” which had an error rate of 2.14% totaling $213,000.
Of those checks, 194 of them totaling $200,000 were canceled because the recipient rejected the payment.
*As of September 8, more than 1,700 checks issued prior to June 30 remained outstanding.
The audit was requested by the Legislative Oversight and Investigation Committee this past July, and the inspection came on the heels of media reports indicating several Kentuckians living outside the impact zone received checks from the fund.
The audit brought about six concerns to the relief effort:
1) Did the Executive Branch consider if collecting donations was appropriate?
2) Did the Public Protection Cabinet (PPC) have the ability to accept donations?
3) Is Executive Branch Ethics Commission Advisory Opinion 16-09 applicable, and was PPC required to establish a nonprofit entity to be able to accept donations?
4) Did PPC have authority to expend donated funds without appropriation by the Legislature?
5) The legislative request identified that over 200 checks were issued from disaster relief funds to persons who did not request the monies or who have later stated no objective need.
6) And why are there a significant number of outstanding checks?
In all, however, more than $32.4 million came from singular donations, more than $10.7 million came from businesses, more than $6.9 million came from charities, more than $1.9 million came from non-profits, more than $180,000 came from anonymous donors, more than $18,000 was unspecified cash, and more than $52 million was raised.
Off-the-top expenditures of the fund included:
— Funeral payments for Kentuckians who lost their lives in the storms
— An initial assistance payment to insured and uninsured/underinsured property owners
— A second assistance payment of $1,000 to those impacted by the storms
— Grain assistance to local farmers
— Long-term Recovery Group payments to those with unmet needs
— And payments to non-profit entities to assist with home reconstruction needs
Currently, nearly $10 million remains for perpetuity and long-range planning in the disaster zone — which for the News Edge listening area includes Caldwell, Christian, Hopkins, Lyon and Marshall counties.
FULL AUDIT: 2023TornadoFloodReliefFundsExam
