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The American Saddlebred Horse Association on Tuesday closed its office in Lexington for unspecified period of time to organize documents its officials have been ordered by the courts to turn over to some of its members, just the latest in a 2-year battle to determine how officials are spending of the organization’s $2 million annual budget.
One of those concerned members is Undulata owner Edward “Hoppy” Bennett, who said that an ASHA audit had disclosed serious financial deficiencies within the organization.
“There’s been a lack of oversight of how the money has been spent,” he said. “A group of concerned members went to see them and asked for books and records that they [ASHA officials ] refused to give.”
ASHA, based at the Kentucky Horse Park, is run by 18 directors, and there are more than 8,000 active members, including dozens in Shelby County. ASHA carries out administrative, promotional and educational activities for the benefit of its members and the breed. It keeps all registrations and operates a museum at the park.
The most recent court documents, dated July 21 in Fayette Circuit Court, explain the reaction of the ASHA to the members’ wanting officials to be charged with contempt of court for withholding “large categories of records” in violation of the court.
“They do not want to show the eight thousand membership how they’re spending their budget,” Bennett said.
Because of its closed offices, ASHA officials did not respond to phone messages or E-mail Tuesday.
The court continuously has agreed with the members, according to court documents and Bennett, who also said the courts have given ASHA until Aug. 5 to hand over all information the members are seeking.
The group requested 29 items, ranging from employment agreements and salaries to individuals who received any financial gain from advertising and marketing, to routine packets of information and reports provided for directors meetings.
Bennett said ASHA officials have said they had turned over the requested information and that they’ve disrupted their own office to give them everything but that they have in fact not given everything.
That’s why officials closed the office Tuesday for “whatever duration of time is necessary for ASHA staff to research and produce all the documents requested to meet the demands of the "Concerned Members," according to its release.
“How many times can you lose your virginity? How many times can you give us everything?” Bennett said.
How it all began
According to a letter from senior members of ASHA to its directors, this conflict began in April 2009, when Bennett and five other members asked the association to provide information so they could “be sure that the ASHA is utilizing its assets in a prudent manner, and in furtherance of the purposes of the ASHA.”
“After that request,” the letter said, “the ASHA provided copies of tax returns and certain related financial reports of the ASHA for calendar years 2006 and 2007. After our initial review, these reports seem to indicate that the ASHA has expended significant sums on items for which we are unable to determine what benefit, if any, the ASHA received in return. Those expenditures range from a few thousand dollars to more than $400,000.”
Included among the requests was a one for a copy of the “employment agreement and deferred compensation package” for Alan Balch, the executive secretary of ASHA.
According to the correspondence, directors approved “an employment agreement and deferred compensation package” with Balch on Oct. 31, 2007.
Statements provided indicate that the compensation agreement paid Balch retroactively to Nov. 1, 2006. The IRS Form 990 filed on behalf of the ASHA for the year 2007 indicates that Balch’s base salary increased to $100,000, but the financial records members received fail to disclose the additional benefits that Balch is entitled to receive, in addition to his salary, as part of his “deferred compensation package.”
The ASHA has a 501(c)(3) status, which means it is a public entity that must provide public information to people who request it. ASHA also receives state funding.
Bennett said that because ASHA has this status it is “transparent” and “required” to distribute this information to the members.
But AHSA has fought vigorously to maintain control of the records, including filing suit to prevent its members from inspecting its corporate records, but the court rejected the ASHA’s arguments and declared that Kentucky law entitles the members to inspect and copy the corporate records. ASHA has appealed and lost.
Bennett said they are fighting to not give out information but are being forced to by the courts.
“They [ASHA] have lost in front of every judge,” he said.