From: bobworn@aol.com
Subject: SNET: Another Government Rip-Off - Good One, Doug
Date: 23 Aug 2000 11:22:33 -0400
To: BOBWORN@aol.com

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                 Another Government Rip-Off
 
 by DOUG FIEDOR 
 fiedor19@eos.net 
 Heads Up 
 
 Number crunching is not one of our most favorite things 
 to do.  However, I have been examining government budgets 
 for quite some time and no longer get fooled easily by 
 the devious tricks often used to hide things from the 
 general population.
 
 So, I was very skeptical when I received messages from 
 two normally credible sources that the administrations of 
 State governments were hiding many billions of bucks from 
 both the people and the State legislators in a "secret 
 set of books."  In truth, this sounded much too much like 
 yet another urban rumor or Internet conspiracy floated 
 out for whatever reason people do such things.
 
 Compounding the issue was the fact that they were 
 targeting Kentucky as having nearly $9.5-billion in 
 unallocated funds just sitting around.  But, two things 
 are wrong with that statement:  First, the Kentucky 
 General Assembly was controlled by liberal Democrats for 
 over 200 years.  Second, the governor's office has also 
 been held by liberal Democrats most of that time.  So, 
 let's face it; if they could find money, they would have 
 spent it.
 
 Nevertheless, I asked a State Senator for a copy of the 
 often pointed to Comprehensive Annual Financial Report 
 (CAFR) and eventually got around to taking a look.
 
 The CAFR is more or less an audit of the State's assets 
 reported to the federal government.  Part of the State's 
 budget is in there, too, but the CAFR is different than 
 the budget because it also lists all assets.
 
 After the third hour of studying the report, I had two 
 basic impressions:  First, whoever wrote the report did 
 not take the job very seriously.  The writing is 
 contradictory in parts and there were major accounting 
 errors -- one major error of $280-million and others of a 
 million bucks or more each.  Second, I doubted that 
 anyone ever read the report, and certainly not federal 
 government accountants or auditors.
 
 Generally speaking, I could see how others -- like 
 CAFRman at http://www.cafrman.com/Articles/Art-KY-S1.htm 
 -- came up with a figure of $9.436-billion in unallocated 
 funds for Kentucky, but I did not agree with the 
 specifics. Because of a mishmash of old and new laws (and 
 a clause in the State Constitution), much of that $9.436-
 billion was not available funds.  It could be in other 
 States, but not in Kentucky.
 
 Nevertheless, what I did find is about $2.4- billion in 
 immediately free funds that could and should be returned 
 to the people of Kentucky.  It was also easy to identify 
 another $3-billion, or so, that could also be returned to 
 the people after a few minor law changes by the General 
 Assembly.
 
 Therefore, without comment, I handed the Kentucky 
 Comprehensive Annual Financial Report off to David Buck, 
 MBA, who is a good accountant.  We agree on many of the 
 same items for the same reasons and a few minor items for 
 slightly different reasons.  Better yet, we both agree 
 that, with just a couple minor changes in the law, a 
 total of about $4.7-billion could and should immediately 
 be returned to the people.  That equates to about $1,300 
 for every man, woman and child in the State.
 
 This also presents a major problem for the Commonwealth 
 of Kentucky.  The Governor and General Assembly are bound 
 by Section 53 of the Kentucky Constitution to, "provide 
 by law for monthly investigations into the accounts of 
 the Treasurer and Auditor of Public Accounts. ...  The 
 reports received by the Governor shall, at the beginning 
 of each session, be transmitted by him to the General 
 Assembly for scrutiny and appropriate action"
 
 Section 53 has quite obviously not been faithfully 
 followed, else the General Assembly would know that the 
 Commonwealth of Kentucky has many billions of dollars in 
 unallocated funds and that there is absolutely no reason 
 to raise our taxes.  In fact, there is enough money 
 currently available to run the Commonwealth for at least 
 a year with no taxes.  Furthermore, based on the current 
 State budget, if all the $34-billion identified in the 
 CAFR were properly invested, there is a great chance that 
 the Commonwealth of Kentucky could operate, perpetually, 
 from just the interest, and no further taxes or fees 
 would ever be necessary. 
 -----------------------------
 
 NOTE:  This is the first in a series of articles on this 
 topic.  We recommend that readers get a copy of the CAFR 
 for their own State and see what is available.  And, we 
 are happy to report, there is great precedence for 
 returning money such as this to the people.  According to 
 a December 1999 article in the Wall Street Journal, 
 within his first six months in office, Minnesota Governor 
 Jesse Ventura returned $1.3 billion in surpluses to the 
 residents of Minnesota.  For more information, visit: 
 http://www.cafrman.com 
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