What’s unconstitutional in Salyersville is just as unconstitutional in Lexington In the world of public accountability, it’s one thing to point out the rules and quite another to ensure they’re followed. This week, Kentucky State Auditor Allison Ball released a report on the Salyersville Water Works, blasting the utility for distributing bonuses paid with public funds—deeming the practice a clear violation of Section 3 of the Kentucky Constitution. Strong words, strong stance. But let’s talk about what’s missing. Finding 5 of the Salyersville Water Works Special Examination notes that “awarding of a bonus from public funds violates Section 3 of the Kentucky Constitution[.]” While the Auditor’s office is quick to call out the relatively minor infractions in Salyersville—bonuses totaling a whopping $13,792 over two years—they’ve remained conspicuously silent on a much larger scandal brewing closer to the state’s urban heart. The Lexington Convention and Visitors Bureau, better known as VisitLex, recently shelled out $284,745.05 in bonuses to its staff in Fiscal Year 2024, including a hefty $56,507.20 bonus for its president. These funds? Directly tied to the transient room tax paid by hotel guests—public money, plain and simple. Now, let’s connect the dots. If public funds funneled into employee bonuses are unconstitutional in Salyersville, they’re just as unconstitutional in Lexington. Yet the Auditor’s office, which has openly acknowledged it is aware the VisitLex bonuses, hasn’t taken the same bold action. No special examination, no scathing press release, no demand for answers. Just silence. For a watchdog, that’s a pretty selective bark. Let’s call it what it is: a glaring double standard. When a small-town utility steps out of line, the Auditor swoops in, armed with findings and legal citations. But when the infractions involve a well-connected tourism bureau with a $14 million budget? Crickets. What gives? Is it the scale of the budget? The political relationships? The tourism dollars at stake? Whatever the reason, the inaction is deafening—and it raises the question of whose interests the Auditor’s office is truly serving. According to VisitLex’s recently released 2024 financial audit, the organization’s financial position reveals some intriguing priorities and raises pressing questions about the use of public funds. Cash Stash Alert VisitLex is sitting on over $14.5 million in total cash and investments, with $11.9 million in unrestricted demand deposits alone. This liquidity—essentially cash ready to be deployed—represents a staggering financial cushion for an organization primarily funded through public taxes, including the transient room tax on Airbnb and hotel stays. While having reserves is important for operational stability, the sheer scale of this unrestricted cash surplus raises eyebrows. VisitLex is currently sitting on over $14.5 million in total cash and investments. Unrestricted Net Position: Play Money? As of June 30, 2024, VisitLex’s unrestricted net position—resources available for discretionary use—has soared to $8.1 million, a 19% increase from the previous year. These funds are not tied to specific projects, meaning they could theoretically be redirected to address pressing community needs. Instead, $284,745.05 of taxpayer dollars went toward bonuses for VisitLex staff. With such a large financial cushion, this decision reflects a questionable prioritization of internal rewards over broader public impact. Priorities Matter: A Legislative Opportunity? This financial picture underscores the need for a broader discussion about how VisitLex’s substantial cash reserves could serve the community more directly. Much of their revenue stems from Airbnb and other short-term rentals, which—while boosting tourism—also contribute to housing challenges by reducing available long-term rental stock. These dynamics impact affordability in Lexington, particularly for lower-income residents. It would be transformative if the legislature acted to give Lexington-Fayette County’s local merged government the ability to tap into VisitLex’s massive reserves for public benefit. Imagine directing just a portion of their unrestricted funds into Lexington’s Affordable Housing Fund. This existing mechanism could help address the very housing affordability issues exacerbated by short-term rental growth. Such a shift would ensure that tourism dollars not only attract visitors but also support the residents who make Lexington vibrant and livable. This post first appeared on my Substack. Subscribe there for the latest updates. https://open.substack.com/pub/paulmoliva/p/kentuckys-auditor-knows-the-rulesbut?r=37efin&utm_campaign=post&utm_medium=web&showWelcomeOnShare=true The post Kentucky’s Auditor Knows the Rules—But Do They Enforce Them? appeared first on The Lexington Times.