Jackson County’s 30-year-old COMBAT sales tax has become a piggy bank that politicians have raided to pay for things that have nothing to do with either of its core missions of fighting drug-related crime and violence, according to a new audit.
It alleges no criminal behavior, but the report released Wednesday accuses the past two Jackson County executives — now Frank White and, before him, Mike Sanders — and their staffs of spending sales tax money inappropriately, sometimes with and sometimes without approval from the county legislature, for more than a decade.
County departments that receive a regular allocation from the more than $20 million that COMBAT raises each year commingled those dollars with other income streams to pay salaries, benefits and other routine expenses without specifying how those expenditures related to helping reduce drug abuse and violent crime.
The audit commissioned by Jackson County Prosecutor Jean Peters Baker and performed by a national accounting firm also found that the county’s finance department under White and Sanders had a pattern of underestimating how much the tax would bring in each year. The county distributed a set percentage of COMBAT revenue to the courts, law enforcement and other public agencies based on a formula adopted by the county legislature in the 1990s.
What the recipients often didn’t know is that they were not getting a percentage of the tax revenue collected over those estimates. COMBAT sales tax revenues exceeded the budgeted amounts in nine of the past 11 years, creating surpluses that ranged from $277,600 in 2010 to $2.8 million in 2015, the last year Sanders was in charge of county government.
But instead of spending that extra money on the anti-drug and anti-violence programs the sales tax was meant to support, it went to other things having nothing to do with the COMBAT program. In 2017, for example, only $131,946 of the $1.28 million surplus was spent on COMBAT anti-drug and anti-violence programs.
According to the audit, excess funds that came in over that estimated amount were skimmed off into an undesignated-funds account that the county executive could use for emergency expenses and special projects. Both White and Sanders did so, the report said, without clearing the practice with the COMBAT commission, whose members are appointed by the county executive to oversee how the sales tax money is used and make other recommendations.
“There has been a pattern of COMBAT funds being spent without the approval or knowledge of COMBAT management,” the report said.
The auditors questioned whether many of those expenditures were the kinds of things that voters had intended their money would be going for when they first approved the quarter-cent anti-drug sales tax in 1989.
For instance, White’s administration dipped into COMBAT funds to help pay a portion of the purchase price of the county-owned pickup truck that White’s chief of staff, Caleb Clifford, has exclusive use of. The previously reported maneuver was aimed at making the purchase without having to get approval from the county legislature.
White’s staff split the $33,945 purchase into six appropriations below the $10,000 spending threshold requiring approval from the county legislature. The anti-crime tax paid for $4,869 of what it cost to put Clifford in the driver’s seat of a 2016 Chevy Colorado.
That purchase is one reason the legislature voted in late 2017 to transfer authority over COMBAT to the county prosecutor’s office.
Sanders also took money from the COMBAT fund to finance his pet projects, the audit said. Among them was a home giveaway program that brought him good press each Christmas — the houses were rehabbed by ex-drug offenders.
When county facilities broke down or fell apart, both men looked to COMBAT as a source of money to make repairs at the two courthouses in Independence, for instance, or make fixes at the downtown jail, and the legislature approved them.
The audit said White used $750,000 in COMBAT funds to buy two vans and make repairs to the jail’s elevators and showers. He spent $2.1 million in COMBAT funds to fix broken cell doors at the Jackson County Detention Center without letting COMBAT officials know that was being done with anti-drug sales tax funds.
The report cited a number of examples of what the auditors considered questionable use of COMBAT funds, such as Baker buying furniture for her department from the prosecutor’s regular COMBAT allocation. It noted that between 2016 and 2018, nearly $90,000 in COMBAT money went to pay the phone and car allowances of top staff working for COMBAT, the county executive and county prosecutor’s office as well as the legislative auditor.
White did not get an advance copy of the audit and said he and his staff needed time to review it before commenting in detail on it findings. But in a statement issued late Wednesday afternoon, he said at first glance the report seemed full of errors.
“Unlike numerous members of the media, the County Executive’s Office was not provided an advanced copy of the report prior to its public release this morning,” White said. “Therefore, we are unable to fully address the entirety of the report since we are still reviewing its contents at this time. We will continue to thoughtfully review the report’s findings and look forward to working with other stakeholders as we move forward.
“However, it is important to note that we have already identified ... factual inaccuracies within the report. While we would have preferred to have been involved prior to today’s release, so that we could have helped ensure inaccurate information was not disseminated, we remain hopeful that the inaccuracies within this report will be corrected immediately.”
For example, he said he audit inflated COMBAT revenue by nearly $2 million in 2018.
Sanders could not comment as he is serving time in federal prison for misusing campaign funds.
This is the first of two audits of the countywide Community Backed Anti-Crime Tax, commonly known as COMBAT, expected to come out this year. Missouri Auditor Nicole Galloway is also working on one as part of a broader look at the county’s finances.
Baker took charge of COMBAT around this time last year after winning a court fight. White had challenged the county legislature’s 2017 decision that stripped the county executive’s office of authority over the program and returned it to the prosecutors’ office, which had overseen it previously.
Sanders arranged to have the program put under the county executive’s authority when he stepped down as county prosecutor to become county executive in 2007.
Baker asked the Kansas City office of the national accounting firm BKD to take a look at how COMBAT money was being spent after the county’s legislative auditor highlighted many instances of concern.
“It’s clear, and it’s disturbing, that COMBAT revenues were too often spent on purposes that are not in alignment with the mission of COMBAT,” Baker said in a written statement. “We need to go back to those days when COMBAT’s mission was focused by (prosecutors) Riederer and McCaskill to support innovative programming that tackled crime and improved neighborhoods.”
Her office noted that since Baker took control of COMBAT, county salaries paid with COMBAT funds fell 45 percent and employee benefits paid with COMBAT funds declined 35 percent.
Baker has asked the county Legislature to conduct hearings and track progress on implementing BKD’s recommendations.
The 33-page audit makes a number of recommendations on steps that Baker and COMBAT staff should take to keep a better handle on how COMBAT money is being spent. One suggestion is that they meet annually with county department heads to discuss whether the money they are getting from the tax is serving COMBAT’s mission.
In recent years, the report said, a lot of COMBAT money went to pay a portion of the salaries and benefits of people whose jobs didn’t seem to have much of anything to do with COMBAT, such as employees in the finance, parks and information technology departments.
When White was in control of the fund, it paid a portion of his six-figure salary and others in his office. The auditors said they “received some pushback” from the finance department when they asked to see the pay records and job descriptions of 60 county employees whose salaries were paid in part with COMBAT funds. The department complained that it would take too much time to gather the information.
“Seeing no alternative, we reduced our selection to 10 employees,” the report said.
Among them was Clifford, the chief of health services and the chief deputy in the legislative auditor’s department. The outside auditors wanted to measure whether the percentage of what someone was paid with COMBAT funds matched the percentage of time that person was spending on COMBAT-related activities.
Their key finding: “Multiple instances where the individual being paid did not have a job title and duties that appear to promote the mission of COMBAT and the purpose of the Anti-Crime Tax.”
From now on, the report recommended, county departments should get written approval from COMBAT before using any of the program’s funds to pay someone’s salary.
The audit also recommends that COMBAT do a more thorough job vetting the outside agencies that get funding for drug treatment and other services. The audit questioned why COMBAT money accounts for nearly half of the $60,000 the county donates toward the Martin Luther King Jr. celebration that the Southern Christian Leadership Conference of Greater Kansas City puts on.
“The event is not part of COMBAT’s initiatives, and per management , would not have been funded if it had gone through COMBAT’s grant approval process,” a footnote in the report said.