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Commissioner Russell pushes audit requirement for nonprofit grants; colleagues press for threshold to protect small providers
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Summary
Knox County commissioners debated language to update the countys grant ordinance, including whether to require external audits for grantees and at what dollar threshold; staff said the draft largely codifies current practice and commissioners agreed to draft potential $50,000 trigger language for further consideration.
Commissioner Russell presented proposed revisions to a county ordinance governing nonprofit contracts and grants that would increase transparency and require audits for certain grantees; staff said the language generally codifies current practices, and commissioners debated a dollar threshold to avoid imposing undue costs on small organizations.
Russell told the commission the existing ordinance language is out of date, sometimes refers to "county executive" rather than "county mayor" and does not accurately reflect current workflows. She said the aim of the proposed changes is more transparency and accountability, and she originally favored requiring audits as part of the grant process. "My main goal is to make sure that if we're giving someone money that it's spent the way it's supposed to be," Russell said.
Jenny Holden, director of grants and community development, told commissioners staff had worked with Russell and had drafted language that largely mirrors what the department currently requests from applicants. Holden noted the county already requires either a 990 or an audit where state law requires one and said the new wording clarifies those expectations.
Several commissioners raised concerns that requiring external audits for small grants would be burdensome. Commissioner Jay, who said he has run nonprofits, warned audits can cost thousands of dollars and suggested the county should "mirror state law" on audit thresholds. Commissioner Jackson and others proposed adding a dollar threshold that would trigger an audit requirement: proposals mentioned $25,000, $50,000 and $100,000 during discussion.
Commissioner Russell and others suggested a middle ground; by the end of the discussion Russell volunteered to draft language proposing a $50,000 threshold to present for consideration at the next meeting. Commissioners also discussed administrative details staff would need to implement and monitor contracts, including submission of organizational budgets and top-salary data that the county currently requires.
Director Holden reminded the commission of a past internal case of employee fraud that was discovered in-house, reported to the comptroller and prosecuted with restitution recovered; she used that example to underline the need to safeguard taxpayer funds. "It was actually one of my employees, and we actually discovered it within our own department and reported it to the comptroller," Holden said.
Commissioner Fox also said she would offer a separate amendment next week related to nonprofits and whether they provide services to people residing in violation of immigration laws; she alerted commissioners she had uploaded amended language for consideration. Fox separately used part of the meeting to give a lengthy off-agenda presentation critical of Islam, asserting it is "not compatible with Western civilization" and citing an unverified statistic; several commissioners asked her to confine remarks to agenda business and to reserve other presentations for an appropriate forum.
No formal votes were taken during the agenda-review meeting; commission members agreed to continue work on the ordinance and to consider drafted amendment language at the next meeting.
