Audit confirms Herald-Leader's findings on Bluegrass mental health agency's unchecked spending

A state audit of the Bluegrass Regional Mental Health/Mental Retardation Board confirmed the Lexington Herald-Leader findings that executives gave themselves fat bonuses largely unchecked by the group’s board.

The group handles treatment for 30,000 adults and children across 17 Central Kentucky counties and receives about 68 percent of its funding from the state.

State Auditor Adam Edelen released the audit on Thursday. Among the findings, many of which the Herald-Leader’s John Cheves exposed in his June article, are:

• Executives paid themselves $2.8 million in bonuses and benefits since 1997 while many of the mental health professionals employed by the group haven’t received pay raises since 2009.

• The management used $296,000 in state funds to purchase a house for executives near the Oakwood facility in Somerset that the group runs. Cabinet also had requested receipts for another $32,000 for furnishings but paid the bill anyway without receiving the documentation, the audit found. (After the Herald-Leader published its article, Bluegrass Mental Health sold the house for $292,000).

• Bluegrass Mental Health spent more than $172,000 on lobbying between January 2011 and September 2012 but didn’t adequately document the expenses.

• The president and a contract consultant submitted $38,000 in credit card expenses without proper documentation.

The auditor’s office recommended the board strengthen its policies and procedures as a result of the findings.