KyCIR: Finance secretary reverses committee decision, approves U of L request for legal expenses

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By Kate Howard
Kentucky Center for Investigative Reporting

The state’s finance secretary approved the University of Louisville’s request to spent $1.25 million more on legal expenses, reversing a legislative committee’s decision earlier this month.

The financial sign-off marks the latest step in the back and forth drama over the cost of U of L’s reforms.

Last week, the state government contract review committee denied U of L’s request to double its legal spending in the coming year, citing concerns about the millions of dollars they have already approved in the wake of financial scandals at U of L this year.

“The whole situation, from a contracting standpoint and from a taxpayer standpoint, has grown out of control,” Rep. Stan Lee, committee co-chair said last week. “We just felt it was going too far, and at some point we just needed to make a statement, and this was it.”

While the legislative committee wields oversight on state personal service contracts, its decisions aren’t final.

In a letter to board chair J. David Grissom, Kentucky finance secretary William M. Landrum III said the contract’s amendment would remain in effect as it was approved by the university, despite the committee’s disapproval.

Landrum noted that Grissom, in his earlier plea for funding, said that delays could “jeopardize the potential for recovery of lost endowment funds and the ability to hold those responsible accountable for potential wrongdoing.”

The school is looking to recover millions through potential litigation against former leaders and board members accused of misspending the endowment.

Kate Howard can be reached at khoward@kycir.org and (502) 814.6546.

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