By John Cheves — firstname.lastname@example.org
FRANKFORT — The Legislative Ethics Commission on Tuesday assigned its enforcement counsel to study findings about state Rep. Keith Hall, D-Phelps, and more than $171,000 one of Hall’s companies collected through utility contracts that avoided competitive bidding and public discussion.
The findings were disclosed in a report state Auditor Crit Luallen issued in January examining Mountain Water District, a public water and sewer utility in Pike County. Luallen sent her report to the ethics commission and to Attorney General Jack Conway, who is continuing to review it, a spokeswoman said Tuesday.
George Troutman, ethics commission chairman, said he hopes enforcement counsel Mike Malone will report back with recommendations at the panel’s April meeting. The ethics commission can’t open an investigation without a signed complaint, but its counsel can sign a complaint at the commission’s request, Troutman said.
Hall declined to comment on the issue.
In a separate matter, in November Hall was named to the board of Empire Global Energy, a Ft. Lauderdale, Fla., company that is developing Colombian coal concessions. (His other businesses include interests in coal mines.)
Empire said Hall was a valuable catch because of his legislative post, especially his role as co-chairman of Kentucky’s Special Subcommittee on Energy. His biography on the company’s Web site shows him standing in the Kentucky House chamber.
“As Energy Czar in Kentucky, one of the biggest coal mining states in America, he is in the perfect position to keep Empire apprised of industry trends and policy and regulatory changes,” Frank Rosso, the company’s chief executive, said in a press release.
In an interview Tuesday, Rosso said the company’s board members currently receive no compensation other than reimbursement for travel. However, he said, “There are huge profit potentials in this down the road.”
The company was formed in 2008, he said.
On his 2010 financial disclosure forms, filed in recent weeks, Hall lists Empire as a company in which he has investments worth $10,000 or 5 percent of the company or more.
Anthony Wilhoit, executive director of the ethics commission, said he could not directly address the propriety of Hall getting a corporate board seat, at least in part because of his elected office. Speaking generally, Wilhoit said the ethics commission discourages lawmakers from gaining private benefits from their public office.
Under the state’s ethics law, it’s a Class D felony for legislators to use their official position to obtain a financial gain for themselves, their families or their business associates, Wilhoit said.
The Empire directorship and Hall’s investment in the company is not part of what the ethics commission is addressing, nor was it part of Luallen’s audit.
The ethics commission can issue public reprimands, levy fines up to $2,000 or recommend that a lawmaker be censured or expelled from the legislature. However, it has dismissed nearly all complaints filed against lawmakers in the last decade.
In her audit of the water district, Luallen found that Hall’s B.M.M. Inc. deliberately kept its invoices for electrical work under $20,000, which was the district’s “small purchase authority limit.” Anything less than $20,000 did not have to be competitively bid or publicly reported to the district board.
“Some of these invoices were splitting up work done on the same day just to keep the final price under $20,000,” Luallen said in a January interview.
As a member of the House Appropriations Committee and a representative from Pike County, Hall has helped the water district get many millions of dollars in public funds for its projects. Aside from the electrical work that Luallen questioned, B.M.M. has won several million dollars in sewage line construction projects from the district, but those were competitively bid, the auditor said.
Hall told auditors last year that his electrical work was arranged with the water district’s then-superintendent, Will Brown. Brown refused to speak to auditors, citing litigation that he was involved in after leaving his job, Luallen said.
“What we’ve learned raises the concern that there was a deliberate attempt to keep this from being competitively bid and to keep this from being reported to the water district board, all so it could be directed to one particular individual,” Luallen said in January.