Shell Game

A crony of Ernie Fletcher is about to make big bucks from building a hotel at the horse park. The problem is this deal just doesn’t smell right.

From the Herald-Leader:

When the Bluegrass Equine and Tourism Foundation was formed in March 2007 to build a hotel at the Kentucky Horse Park, one of its members was Steve Branscum, one of then-Gov. Ernie Fletcher's closest friends and political allies.

The Russell Springs construction magnate is no longer on that board. But Branscum's company is one of two signed on to build the hotel. Construction costs for the $90 million project are expected to be about $51 million. Branscum stepped down from the foundation board at the suggestion of the Internal Revenue Service, according to the man who put the hotel deal together.

"The IRS didn't say it was a conflict," said Brad Burgess of the Thayer Group, which is heading up the hotel development with Cincinnati-based Boorn Partners. "They suggested that we reduce the number of people on the board."

Right….. The IRS made a suggestion? I guess the guys at the IRS didn’t have anything better to do than take a look at this house of cards and make a suggestion that that Branscum leave the board. I have to wonder if the suggestion was in the form of, “If this guy doesn’t leave the board then the Federal Government will haul your corporate butt in to court.” We’ll never know.

Rep. Jim Wayne once again proves he is the only person in the legislature that can do math.

Rep. Jim Wayne, D-Louisville, was the sole member of the Capital Projects and Bond Oversight Committee to vote against the deal on Tuesday. "There are serious questions here, when you have a board of directors of an LLC be the same directors as the non-profit foundation," Wayne said Wednesday. "No banker would approve of this. It's a shell game."

I agree with Wayne, no banker would approve of this. However, Jonathan Miller’s Finance Cabinet didn’t have any such reservations signing off on the shell game.

The state Finance and Administration Cabinet awarded the bids and has signed off on the financing. But all other administration is left to the LLC and the non-profit foundation.