Ballard County is $596,053.95 in the hole, and it's expecting that number to climb.
A state audit in February concluded that former treasurer Belinda Foster overpaid more than $13,000 and cut county employee retirement funds short. Ballard County Attorney Vicki Hayden says it actually goes much deeper than that and dates back to 2009.
Hayden says records show Foster paid herself for one medical claim five times. Foster paid the fiscal court $27,945 as a result. Hayden hopes the remaining nearly $600,000 deficit will come from the county's bonding insurance with Liberty Mutual. It guarantees security if a payment defaults.
The fiscal court voted to send a claim to Liberty Mutual Tuesday. It’s 18 pages of missteps and, because Foster was bonded for $500,000 per year, Hayden thinks the county can get the money back.
Hayden tells me it’s been a rough process, but she’s starting to see an end. Hayden — along with the FBI, IRS, U.S Attorney’s Office, Kentucky Department of Revenue, and Kentucky Retirement System — has spent four months combing through six year of financial records.
“There were a few employees that nothing was taken out of their check, and there were a few employees too much was taken out of their check. So, we owe them money back,” she told me. Inside the ledgers, she also discovered that half of taxes was not filed in 2015. “Those have now been filed. We're just waiting for the letter from the IRS telling us how much we owe in penalties and interest and negligence fees,” Hayden said.
The claim says Foster paid $85,000 in interest and penalties to the IRS in six years without the fiscal court’s consent. The court also had to pay $146,000 to the Kentucky Department of Revenue; $48,000 went to a penalty.
According to the claim, $200,000 to $300,000 was paid in health coverage by the county, but it was supposed to be paid by the employees.
The findings also point to Foster overpaying herself more than $45,000 in overtime and $5,000 in unapproved vacation. Hayden doesn’t believe this was all intentional. “Were not sure what happened, but I wonder if maybe the job got complicated, and things went over her head, and she didn't know how to ask for help.”
The claim to Liberty Mutual contains three blanks, because the county doesn’t know how much it owes the IRS, the retirement funds of county employees, or how much the county overpaid for employee health insurance plant yet.
Hayden says she believes Foster will likely face criminal charges, possibly in federal court. She’s not sure which of the claims against Foster would classify as civil at the time.
Hayden says treasurers from Todd, Caldwell, and Carlisle counties spent hundreds of hours helping Ballard County get its finances straight, for free.
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