Kentucky auditor: More oversight needed for county jail contracts

Published 6:16 am Friday, July 16, 2021

Kentucky’s county jails routinely awarded communications contracts without competitive bidding, the state auditor said Thursday in urging legislative action to better govern the contracting.

Many Kentucky jails provide more than a traditional phone line for inmates to use. Vendors awarded the communication services contracts reviewed by Auditor Mike Harmon’s office can provide video, email or text options for inmates to stay in contact with their families.

Harmon said his office surveyed county jails and examined communication services and equipment contracts in effect between July 1, 2019, and November 15, 2020. Some county jails reported having one contract in place during that period, while others reported having as many as three.

The auditor delved into how the contracts were awarded and the financial benefits that jails reaped.

Based on survey responses, 32 contracts were awarded by competitive bidding, while 81 contracts either were not bid or the respondents did not know whether the contract had been bid, Harmon said.

“Jailers would benefit from more guidance as to how these contracts should be procured,” he said.

The review found 10 contracts that were verbal or included verbal terms. Unwritten contracts raise “serious policy issues” by obscuring the terms from county officials and taxpayers, the report said.

The communication services contracts have become revenue sources for Kentucky’s county jails, mostly through commissions or technology grants.

Seventy-five jails reported receiving commissions totaling more than $9.68 million in the year ending June 30, 2020, Harmon said. Twenty-nine jails received more than $1.38 million from technology grants as a result of the contracts. The auditor urged state lawmakers to ensure “full transparency” in the reporting of revenues that jails receive from the contracts.

Procurement of those contracts is not covered by Kentucky statutes, Harmon said. As a result, jailers have limited guidance when awarding the contracts. For example, when a jailer is trying to determine the best bidder, it’s unclear whether it should be based on maximizing jail revenue, providing the lowest cost of services to inmates or some balance of those factors, the auditor said.

The review also found that not all commissions received from the contracts are sent to the county treasurer for deposit in the Jail Fund. Vendors sometimes send commission checks to the county jailer rather than the treasurer, or vendors send a check to both offices, it said.

Technology grant funds were used for a variety of purchases, including for a body scanner, video system and other upgrades. Other reported uses included mats, clothing and medical services for inmates, the auditor’s report said.

“I believe the General Assembly should pass legislation to provide guidance on procuring these contracts, clarify requirements on the use of technology grants and similar funds and, most importantly, ensure full transparency on the reporting of benefits and revenues jails receive from these contracts,” Harmon said in a news release.

Harmon, a Republican, announced this week that he will run for governor in 2023.