BY LISA STAYTON
MOUNTAIN CITIZEN
INEZ — State officials suspended public funding for three Martin County agencies for violating a state law meant to ensure financial transparency.
Funding will be withheld from the Martin County Tourism Commission, Martin County Housing Authority, and Big Sandy Regional Airport Authority due to their failure to submit required financial reports, the Kentucky Department for Local Government announced. Public notices published Jan. 29 confirmed the violations, citing missing financial filings and unpaid registration fees dating back several years.
“The Auditor of Public Accounts has been notified, and state funding for [the entities] will be withheld until further notice,” according to the public advertisement.
The DLG encouraged the entities to comply with the law.
Tourism lapses
The Martin County Tourism Commission had not submitted financial reports since 2022 when former Judge/Executive Colby Kirk last filed them. The agency did not file year-end financial reports for 2022, 2023 and 2024. It also failed to submit budget amendments and estimates for 2023 through 2025. Additionally, the commission did not register or pay registration fees for 2024 and 2025.
The DLG identified the last known members of the tourism board as Nita Collier, Jarrod Slone, Katrina Sansom, Brenda Davis, Linda Webb and Lauren Cox-Runyon.
Housing fails to file
The Martin County Housing Authority, which would have been exempt from fees and financial reporting requirements, failed to file Housing Authority Exclusion forms within 15 days of the close of the fiscal year for several years. This form certifies that no more than 20% of the authority’s revenue comes from non-federal sources.
Because of the oversight, the authority must submit exclusion forms, financial records, budget estimates, amendments and year-end actuals for 2019 through 2024. To comply for 2025, the agency must register, pay fees, and submit the exclusion form and budget estimates.
The DLG identified former housing director Garry Lafferty as the last known point of contact. Lafferty has not been with the Housing Authority for more than a decade. The state noted there were no known board members.
A review of records shows exclusion forms in Martin County Housing Authority’s folder on the DLG’s legacy website belong to “Martin Housing Authority-Floyd County.” The DLG rolled out its new SPGE portal in July 2023.
Airport updates, still missing audits
The DLG flagged the Big Sandy Regional Airport Authority for noncompliance due to missing budget amendments, year-end financial reports for 2024, and registration requirements for 2025, including filing fees and budget estimates.
Following notice from the DLG, the airport authority updated the filings named in the public notice. However, the airport’s compliance status is on “administrative hold” because it did not submit audit reports for 2017, 2021, 2022 and 2023.
In a Feb. 5, 2024, letter to the DLG, CPA Shad J. Allen of Richmond asked that the DLG place the airport authority’s compliance status on hold until March 15, 2024. Allen advised that the authority had contracted with his firm to complete the 2017, 2021 and 2022 audits. “Our estimated completion date is March 15, 2024,” he wrote.
The DLG listed Duell Sturgill as the last known contact and identified the agency’s most recent known board members as Sturgill, Paul Butcher, Larry J. Cox, Terry Marshall, James Ayers, Tommy Carpenter, Scott Porter, Doug Hyden and Jerry Price.
What the law requires
KRS 65A ensures financial transparency and accountability for “special districts,” requiring them to report their activities and finances regularly or face penalties.
These districts, now called Special Purpose Governmental Entities (SPGEs), include various government or quasi-government agencies that provide specific services within limited areas and can collect or spend public funds.
SPGEs must register annually and pay a registration fee.
They must also submit an annual budget, track changes throughout the year, report year-end financials (unaudited), and undergo audits or attestations.
If an SPGE misses a deadline, the DLG issues a warning and gives 30 days to comply.
After 30 days, if an SPGE remains noncompliant, state funds may be withheld and public notices of noncompliance will be published in the local newspaper.
Continued noncompliance can trigger state audits, which the SPGE must pay for.
Residents can also take legal action in Circuit Court to enforce compliance, and courts may order the SPGE to cover legal fees.