State auditor’s report on Utah Local Governments Trust reveals ‘culture of excess’

Posted at 6:15 PM, Jul 20, 2016
and last updated 2016-07-20 20:15:45-04

SALT LAKE CITY – It’s your tax dollars on the line, and a state auditor is blasting a government entity for wasting the money.

You may have never heard of the Utah Local Governments Trust, but you pay for it.

State Auditor John Dougall spotted several red flags during a 14-month long investigation into the practices at the Utah Local Governments Trust.

“We noted what we call a culture of excess,” Dougall said.

The government entity acts like an insurance company on behalf of its 556 members. Members represent cities, counties, and special districts in Utah. The audit showed excessive spending on board retreats and overnight trips.

Board members and their families spent nine nights at the Grand America Hotel for a total of $2,118. Another $1,274 was spent for 23 meals, and $145 on parking.

At a Park City retreat, $1,664 was spent for 14 board members, trust employees and spouses during a dinner at Ruth’s Chris Steak house. Five iPads were purchased for new board members at a cost $2,270

“It appeared that this had just become a historical practice of the board," Dougall said. "It's just kind of what we do."

“We are committed to being open, transparent,” said Steven Hansen, the CEO for Utah Local Governments Trust.

He said the audit has forced them to make changes.

“I’d like the public to know that we take our responsibility very seriously about this," Hansen said. "We've pared back our board retreats and meetings. We've pared back member events."

The audit also criticized Hansen’s $432,231 salary. Dougall says it’s 86 percent higher than the average CEO of similar entities.

The Board Chair, Joe Piccolo, determines the salary and defended the amount.

“Our board commissioned a thorough, scientific survey, and Steve’s salary was squarely in the middle," Piccoloa said. "Based on our research and the unprecedented performance of the Trust, Steve is worth every penny we pay him. There is nobody else who could lead our organization to such consistently high performance and incredible returns to our members.”

The Utah State Auditor says they will follow up with the Utah Local Governments Trust in a year to see if they've taken any action. Click here to read the full audit.