Interim Joint Committee on State Government


Minutes of the<MeetNo1> 2nd Meeting

of the 2010 Interim


<MeetMDY1> August 25, 2010


Call to Order and Roll Call

The<MeetNo2> second meeting of the Interim Joint Committee on State Government was held on<Day> Wednesday,<MeetMDY2> August 25, 2010, at<MeetTime> 1:00 PM, in<Room> Room 154 of the Capitol Annex. Senator Damon Thayer, Co-Chair, called the meeting to order, and the secretary called the roll. Representative Mike Cherry, Co-Chair, chaired the meeting jointly with Senator Thayer.


Present were:


Members:<Members> Senator Damon Thayer, Co-Chair; Representative Mike Cherry, Co-Chair; Senators Walter Blevins, Jr., Julian Carroll, Jimmy Higdon, Mike Reynolds, John Schickel, and Johnny Ray Turner; Representatives Eddie Ballard, Kevin Bratcher, Dwight Butler, John "Bam" Carney, Larry Clark, Leslie Combs, James Comer, Jr., Tim Couch, Danny Ford, Derrick Graham, Mike Harmon, Melvin Henley, Charlie Hoffman, Mary Lou Marzian, Brad Montell, Lonnie Napier, Sannie Overly, Darryl Owens, Tanya Pullin, Tom Riner, Carl Rollins II, Steven Rudy, Sal Santoro, Kent Stevens, Tommy Thompson, Jim Wayne, Alecia Webb-Edgington, and Brent Yonts.


Guests:  James Musser, Mercatus Center at George Mason University; Jonathan Miller and Greg Haskamp, Finance and Administration Cabinet; Laurie Dudgeon, Kentucky Administrative Office of the Courts (AOC); Representative Fred Nesler; Laura Hendrix and Greg Woosley, LRC staff.


LRC Staff:  Judy Fritz, Kevin Devlin, Brad Gross, Alisha Miller, Karen Powell, Bill VanArsdall, Greg Woosley, Sean Donaldson, and Peggy Sciantarelli.


Approval of Minutes

            The minutes of the July 21 meeting were approved without objection, upon motion by Representative Rudy.


Memorial Resolutions

Senator Thayer presented committee resolutions memorializing Senator Harris’s wife Janet and Representative Glenn’s wife Cornelia. The resolutions were unanimously adopted, upon motion by Representative Cherry, and will be transmitted to the families.



            Senator Thayer announced that the Committee’s September meeting will be a joint meeting with the Interim Joint Committee on Local Government in Georgetown at the Toyota plant.


Previous Information Requests

Senator Thayer noted that information requested by Representative Webb-Edgington at the July meeting relating to Block-50 payments in the Kentucky executive branch is not yet available but that staff expects to receive it from the Personnel Cabinet by the end of the week.


Representative Yonts noted that during the July meeting he requested that the Department of Parks provide the Committee with information on how the Department intends to achieve its short-term improvement recommendations, how the agency will save money by contracting out concessions, and whether there will be competitive bidding for food services. He said the July 23 response mailed to committee members by Tourism, Arts and Heritage Cabinet Secretary Marcheta Sparrow is too vague and general. He moved that committee staff send a letter to the agency asking for information that is more specific and detailed. The motion was adopted unanimously by voice vote. Representative Cherry said he anticipates having Secretary Sparrow and the Parks Commissioner testify at another meeting during the 2010 Interim, and Senator Thayer concurred.


Taxpayer Transparency Act

Senator Thayer said that in the 2009 session Representative Jim DeCesare introduced House Bill 13, the first legislation that would have mandated state government transparency, but it did not pass. In the 2010 session, he (Senator Thayer) filed Senate Bill 40, which passed the Senate but was not considered in the House. He said that he has been working with Representative Cherry, in anticipation of passing transparency legislation in 2011, and Representative Cherry suggested inviting representatives of all three branches of state government to speak to the Committee. He pointed out that the Open Door website operated by the executive branch was created by executive order. He stated, however, that transparency initiatives should be mandated by statute and that he will be prefiling BR 43 today for introduction in 2011. The bill is identical to Senate Bill 40 from 2010.


Representative Cherry said the three branches of government are already doing much to further transparency but that he, too, prefers that transparency requirements be codified in statute. He said he has prefiled BR 75 for introduction in 2011. It is the same as legislation he sponsored with Representative Johnny Bell in 2010 and is similar to Senator Thayer’s BR 43.


Representative Bratcher said that several of his constituents—one of whom is present today—have expressed concern that citizens do not have sufficient opportunity to speak before legislative committees, at both session and interim meetings. He asked whether it might be possible to include a provision in BR 43 to address that concern. Senator Thayer said he would be happy to work with Representative Bratcher regarding that issue.


Senator Thayer welcomed special guest speaker, Mr. James C. Musser, Director of Economic Education for the Mercatus Center at George Mason University in Arlington, Virginia. He noted that Mr. Musser is responsible for leading the federal and state outreach team to disseminate the latest scholarship to policy makers. He is also a Kentucky native who earned his juris doctorate from the University of Kentucky College of Law and is a summa cum laude graduate of Marshall University.


Mr. Musser spoke on the subject of transparency in government and how transparency can lead to greater accountability. He commended Kentucky legislators and officials for their efforts to make their state government more open and accountable. He said that transparency is a process and a tool, not an end in itself. It requires full and truthful disclosure in a useful and understandable form. It is intended to hold government more accountable and allow constituents to have greater trust in what government is doing. The benefits of transparency are obvious. It empowers the legislature to properly assess expenditures, direct funds to programs of worth and away from programs that do not work, and demonstrate that taxpayer monies are providing real benefit. True transparency—a full accounting in a format that the average voter can understand—is likely to have the effect of protecting against and preventing waste, fraud, and abuse.


Mr. Musser said the best way to achieve lasting transparency is through legislative action. Legislation to codify transparency would have at least two positive aspects that are lacking in executive actions. First, the legislative process will allow full and open debate regarding what should be made transparent, how it should be made transparent, and how to protect confidentiality when it is rightfully needed. Second, codification means that once transparency is established, it is not easily removed. Thirty-one states have enacted transparency legislation, and some of the recent legislation has even extended to the local level. He said the Bluegrass Institute for Public Policy Solutions, based in Kentucky, would be a valuable resource with respect to transparency at the school district level.


Mr. Musser said that the Mercatus Center does not endorse or oppose legislation or candidates for office but that he and some of his colleagues have reviewed BR 43 and BR 75. He feels that the specific data elements of the legislation are particularly valuable but that the legislation might be further strengthened by requiring contact information or state-issued identification for vendors. It could also be strengthened by adding guidance on how to present information online in a workable form. The American Legislative Exchange Council’s model legislation would be a helpful resource, and Jerry Brito, a colleague at the Mercatus Center, would be glad to provide guidance in setting up websites. It would also be good for the bills to require a description of each expenditure; as written, they only require a description if it is available.


Mr. Musser said he is leaving with committee staff copies of two publications that may prove useful: (1) a June 2010 article, Transparency and Performance in Government, written by colleagues Jerry Brito and Drew Perraut for the North Carolina Journal of Law and Technology; and (2) an April 2009 Mercatus on Policy publication entitled The Cost of State Online Spending-Transparency Initiatives. He said he thinks Kentucky can establish the transparency websites for a reasonable cost. Mercatus research found that the cost of transparency initiatives ranged from virtually nothing in Louisiana, which had preexisting software, to $15,000 in Alaska and about $100,000 in Maryland, although there was no discernible difference in quality of the end product in those three states.


Elaborating on comments from Representative Harmon, Mr. Musser emphasized that in order for data to be transparent, it has to be in a searchable form that is user friendly.


Senator Thayer said he believes Mr. Musser has provided evidence that it is not unduly expensive to create a transparency website. He also stated that the expense would be justified because transparency has historically shown that it can save taxpayer dollars and reduce government spending. Mr. Musser concurred.


Senator Thayer asked about states that have demonstrated excellence in the area of transparency and have codified it in statute. Mr. Musser said that Virginia does a very good job—and also Arkansas and Missouri. Virginia consistently ranks at the top in having a fine business climate. He stated that transparency does not directly correlate with growth but is certainly a component of attracting business.


Mr. Musser said it is his personal observation that the vast majority of elected officials want to do the right thing; however, these are dangerous times in which people seem to feel alienated from the legislative bodies that are supposed to represent them. Clearly more transparency is needed in order to restore society’s trust in the good stewardship of government officials.


Representative Cherry complimented Kentucky’s executive branch Open Door website. When asked his opinion, Mr. Musser said he has looked at the portals for the executive branch and the Secretary of State’s office. He thinks they have done a good job through executive action but that it can be even better, once codified. Concluding, he offered the assistance of the Mercatus Center as Kentucky pursues its transparency initiative.


Transparency in Kentucky State Government

(Representative Cherry assumed the chair for the next part of the meeting.) Guest presenters were Jonathan Miller, Finance and Administration Cabinet Secretary, and Greg Haskamp, Special Assistant to the Secretary.  Secretary Miller commended the co-chairs for their leadership on the issue of transparency, and he complimented Mr. Musser for his presentation. He said transparency has been a high priority of the current administration. Secretary Miller and Mr. Haskamp then proceeded with an overview of Kentucky’s Open Door transparency website.


Secretary Miller said the portal was launched January 1, 2009, using existing resources and staff with no direct cost to taxpayers. It has received very high marks from nonpartisan groups that rate transparency sites, earning an “A” from U. S. Public Interest Research Groups (U.S. PIRG). In June 2010, Kentucky was given top ranking by the Center for Study of Responsive Law with respect to contract disclosure; the Center had previously rated Kentucky as one of the worst performers. The Open Door’s sister site, Kentucky at Work—which provides detailed information on use of American Recovery and Reinvestment Act funds—was ranked number two behind Maryland by Good Jobs First, a national policy resource center. He said that even more important has been the response from the public. There have been more than 1.6 million hits on the Open Door site since January 2009. The site contains details of more than four million individual transactions, and that number grows annually by 1.5 million transactions. Expenditure records on the site account for more than $103 billion. The Open Door is very proud of its high marks but is not “resting on its laurels.” It will continue to be a work in progress. Public input has contributed greatly toward the site’s high ranking. Input from the legislature is also welcomed and will be appreciated. Secretary Miller and Mr. Haskamp concluded their presentation with an interactive demo of the website. They pointed out that both expenditure and contract data are updated twice daily.


When Senator Thayer asked about the cost to build and maintain the website, Secretary Miller said he could not give a dollar figure because it was done with existing staff and resources, and the amount of staff time involved has not been computed. He added that Mr. Haskamp has spent much of his time on the project over the last couple of years. Senator Thayer said that today’s testimony has proven his argument that the availability of quality, capable people already on staff made the transparency site affordable.


Representative Webb-Edgington asked whether the site includes details about block-50 overtime payments to state employees. She said the Committee is awaiting receipt of block-50 information from the Personnel Cabinet, after she requested it at the July meeting. She explained that she is interested in seeing whether there is a correlation between block-50 payments and the mandated executive branch furloughs. Secretary Miller said the Open Door shows block-50 payments by state agency but not by individual employee.


Representative Ballard asked whether the site includes data on school board employees. Secretary Miller replied that it does not include expenditures at the local level.


Senator Thayer said that the presentation has been excellent, that the website is very good, and that it shows that Kentucky is committed to transparency. He asked Secretary Miller to let the Governor know that he (Senator Thayer) and other advocates of transparency in the General Assembly would appreciate the Governor’s support of transparency legislation in the 2011 session. Secretary Miller said he would be happy to relay the message.


Laurie Dudgeon, Executive Director, Administrative Office of the Courts, spoke about transparency in the judicial branch. She said that rather than creating its own transparency website, the judicial branch opted to participate in the Open Door portal and has been “live” there since November 24, 2009. She expressed appreciation to Secretary Miller and staff in the Finance and Administration Cabinet for their assistance in loading the judicial branch information.


Ms. Dudgeon said that judicial branch expenditures from 2007 forward can be accessed via the website’s “expenditures search” link. She said some minor programming changes are planned, from the standpoint of ease of finding information, because some people confuse the judicial branch with the Justice and Public Safety Cabinet. The current reference to “judicial department” in the expenditures search actually refers to the Court of Justice. She said that participating in the Open Door site has saved a tremendous amount of staff time daily in responding to open records requests relating to financing issues. Senator Thayer said that Ms. Dudgeon’s last point serves as a good example of how transparency can help save taxpayer money through increased productivity. He also thanked her for doing a good job at AOC.


Senator Schickel asked whether the judicial branch information includes salaries of circuit judges. Ms. Dudgeon said not at present but that all salaries will be available as soon as the Kentucky Human Resource Information System (KHRIS) is operable. Currently, judicial salaries are linked to the Lexington Herald and Courier Journal websites. She noted that circuit judge salaries are uniform across the state.


Laura Hendrix, General Counsel for the Legislative Research Commission, and Greg Woosley, Assistant General Counsel, presented information about transparency in the legislative branch. They also used an interactive demo of the Kentucky Legislature website as part of the presentation.


Ms. Hendrix referenced an August 20, 2010, memorandum (included in meeting folders) to the LRC from Senate President David Williams and House Speaker Gregory Stumbo advising that, pending LRC ratification, the legislative branch will establish a website that will allow public access to LRC records regarding agency expenditures, personal service contracts, and salaries. The website will be a component of the current “Kentucky Legislature” website and is expected to be operational in the fall of this year. Records displayed will be those considered available under open records statutes applicable to the legislative branch.


Ms. Hendrix gave a brief overview of information that is available on the “Kentucky Legislature” website. She said that the legislative branch has a long history of accessibility and transparency in order to keep the public informed about activities of the legislature. In 1996, the General Assembly passed a bill to require the Kentucky Constitution, Kentucky Acts, the Kentucky Revised Statutes, and administrative regulations to be available on a free and accessible website. The Legislative Record has been online since 1997. “Bill Watch,” a free bill tracking service, has been online since 2000, and chamber roll call votes have been online since 2006. The website provides access to LRC publications and serves as a valuable resource for learning about the legislative process. Information about ethics provisions and campaign contributions can also be accessed through the Kentucky Legislature home page. The public can also obtain information via several toll-free phone lines.


Subcommittee Report

Senator Thayer, Co-Chair of the Task Force on Elections, Constitutional Amendments, and Intergovernmental Affairs, read the subcommittee report of the Task Force’s August 24 meeting. Senator Thayer’s motion to adopt the report passed by unanimous voice vote.


Business concluded, and the meeting was adjourned at 2:35 p.m.