Audit: Kinder may have had conflict with bike race

JEFFERSON CITY, Mo. -- Lt. Gov. Peter Kinder may have had a conflict of interest by serving as chairman of both the state Tourism Commission and a not-for-profit group that put on the Tour of Missouri bicycle race, according to a state audit released Wednesday.

The audit cited Kinder's dual roles as one of several potential conflicts of interest involving the commission that decides how to spend millions of dollars each year marketing Missouri to visitors and vacationers. The audit also criticized the Tourism Division's budgeting practices and said it lacks performance measurements needed to determine whether advertising efforts are meeting goals.

The audit gave the Division of Tourism a "fair" rating, its second lowest category on a scale ranging from poor to excellent.

Missouri tourism director Katie Steele Danner said the agency is working to implement many of the auditor's recommendations.

The audit comes as Kinder, a Republican, weighs whether to go ahead with a challenge of Democratic Gov. Jay Nixon in the 2012 elections. The Tour of Missouri bicycle race has been a point of contention between the two officeholders.

Kinder was the race's most public supporter since it began in 2007. But Nixon's administration, citing tight state finances, pulled the plug on state funding for the 2010 race, forcing its cancellation. The race has not returned since then.

The audit said Kinder, in his role as Tourism Commission chairman, took part in discussions about funding the Tour of Missouri and voted to approve agency budgets that included $2.5 million for the 2008 and 2009 races. The audit says Kinder failed to disclose on forms filed with the Missouri Ethics Commission during those years that he also was chairman of the not-for-profit Tour of Missouri Inc., which received state funding to administer the race.

Kinder was replaced as chairman of the Tourism Commission in November 2009, and the auditor's office says Kinder also is no longer an officer with Tour of Missouri Inc.

"The accidental failure to include the nonprofit corporation information was an oversight that was corrected as soon as it came to light," Kinder's office said in an emailed statement provided Wednesday by office spokesman Jay Eastlick. "The Lt. Governor had no financial interest whatsoever in the nonprofit corporation."

Seizing on the political implications of the audit, the Missouri Democratic Party said it shows Kinder funneled state money to an organization he ran "to facilitate his lavish lifestyle of fancy parties and expensive meals" used to promote the bicycle race.

"This is the kind of thing that makes Missouri taxpayers sick to their stomachs," said Democratic Party spokeswoman Caitlin Legacki. But the audit also includes criticism of Nixon's administration.

Repeating a theme from audits of other state agencies, the audit of the Tourism Division said it appeared inappropriate for the agency to have paid for $3,072 of airplane flights by Nixon, including ones to the Major League Baseball All-Star game in St. Louis and the 50th anniversary event of the Silver Dollar City theme park in Branson.

Nixon has defended his practice of billing agencies for his flights, saying his travels often relate to functions supported by those agencies. But legislators frustrated by the practice sought to put an end to it in the current budget by specifically prohibiting most agencies for paying for travel by statewide elected officials.

Although the Tourism Division audit bore the name of Auditor Tom Schweich, his office said Schweich recused himself from any involvement to avoid any appearance of a conflict of interest. Kinder was one of the largest contributors to Schweich's successful 2010 campaign.

Under its heading of conflicts of interest, the audit also cited cases in which two tourism commissioners voted on budget decisions related the agency's Cooperative Marketing Program and First-time Marketing Events Program. Division staff later allocated part of that funding to local agencies the commissioners represented, the audit said.

The audit also questioned the division's documentation on the state's costs and benefits of the Tour of Missouri and criticized the division for using an advertising agency as a pass-through for expenditures for the bicycle race. The division's written response to the audit said the advertising contract allowed such arrangements, but it agreed that such expenses should be handled in an open and transparent manner.