Pubdate: Sat, 25 Oct 2003
Source: High Point Enterprise (NC)
Copyright: 2003 High Point (N.C.) Enterprise
Contact:  http://www.hpe.com/
Details: http://www.mapinc.org/media/576
Bookmark: http://www.mapinc.org/rehab.htm (Treatment)
Bookmark: http://www.mapinc.org/corrupt.htm (Corruption - United States)

LEGISLATIVE LEADERS SHARE BLAME FOR FUNDING ABUSES

State Auditor Ralph Campbell says a defunct drug-treatment agency
founded by a former state senator was "riddled with conflicts of
interest" and should return to Raleigh the remaining $338,925 in its
bank account. The John A. Hyman Foundation should comply immediately.
In fact, state authorities should act quickly to secure that money
before it disappears.

But the real issue is how these conflicts of interest were allowed to
continue for 10 years, during which time the state granted this
foundation more than $2 million.

The agency was founded by former state Sen. Frank Ballance of
Warrenton. Last year, he was elected to the U.S. House of
Representatives from North Carolina's 1st Congressional District.

State auditors noted in a report released Wednesday that Ballance was
a state senator and vice chairman of the Senate Finance Committee when
state funds started rolling to his foundation.

Leaders in the N.C. Senate should have recognized that immediately as
a conflict of interest and put a stop to it.

There were other red flags as well. The agency did not provide the
state with audited financial reports or file federal tax forms showing
how it used its funds.

But auditors discovered that some of the money went to Ballance family
members and some was granted to churches, for drug-treatment services,
whose pastors were contributors to Ballance's campaigns.

Campbell stated that some legitimate services were performed by the
agency before it shut down earlier this year when the state cut off
funds. But much of its money went to purposes for which it was not
intended. There was little, if any, accountability for how taxpayers'
money was spent.

It seems as if Ballance got away with this for years because of his
political position in Raleigh. If that's the case, it ought to shame
legislative leaders for not watching more closely - or for looking the
other way.

The FBI and U.S. Attorney's Office in Raleigh have begun an
investigation of Ballance's organization. Maybe they can find out who
let this outfit have more than $2 million of North Carolina taxpayers'
money.
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MAP posted-by: Larry Seguin