Most city treasurers, many city clerks and a lot of other city officials handle cash, checks, online transactions or have access to the city piggy bank while performing their duties. Kentucky Revised Statutes KRS65.067(1) requires city officials and employees “…who handle public funds in the execution of their duties…” to be bonded. The reason for the bond is “…for the faithful and honest performance of his or her duties and as security for all money coming into that person’s hands or under that person’s control.”
So, certain people should be bonded and there is a simple process by which you can obtain the type and amount of bonding needed. Remember, this type of bond addresses faithful and honest performance and is required for protecting the public, not the public official.
The amount of the bond “…shall be based upon the maximum amount of public funds the officer, official, or employee handles at any given time during a fiscal year cycle.” (KRS65.067(1)) The penalty for noncompliance can be found in KRS 62.990(1) which says the person violating the statute “…shall be fined not less than five hundred ($500) nor more than one thousand dollars ($1,000).” Additionally, officials risk losing their elected or appointed office for failing to post a bond.(KRS62.990(2)).
The Kentucky League of Cities staff suggests working with your city attorney on determining who should be bonded and for what dollar amount. Just because a council or commission member approves a budget may not require that he or she be bonded.
KLC provides the bonds through our insurance program. There are typical questions city officials and employees have when applying for public official bonds. One frequently asked question is the process involved.
Read the full article on public officials bonds that appears in a recent issue of Kentucky City magazine. It includes detailed information on types of bonds, pricing, bond amounts and much more.
The Kentucky League of Cities Insurance Agency can assist you in obtaining the necessary bonds to meet this requirement. For more information about bonds or which officials should be bonded, contact Meleasa Andersen or Heidi Lynn at 800.876.4552.