By all appearances, officials of Bannock County and Idaho State University (ISU) colluded to keep control over $850,000 of state money and are using it like a slush fund, even though the law requires them to return unspent appropriated money to the state.
The Idaho Legislature appropriated $900,000 for operating expenses for the East Idaho Forensic Pathology Center (EIFPC) in 2022. The law required the money to be expended only for lab expenses at EIFPC and spent before July 2023.
Documents obtained by the Idaho Freedom Foundation (IFF) and Pocatello for Accountable Government Entities (PAGE) through public records requests indicate the pathology center was never built, ISU did not spend all the money, did not return funds to the state, and instead sent the remainder to Bannock County. Records also indicate Bannock County did not return funds to the state and instead is spending the money like it’s a slush fund.
These investigation efforts were prompted by Bannock County Commissioner John Crowder’s observations shared in a recent public meeting.
The IFF and PAGE — together with Sen. Glenneda Zuiderveld — learned that, according to the records, when the original building plans for the EIFPC fell through and the deadline for expending the funds was approaching, Bannock County invoiced Idaho State University $853,700 for the “forensic pathology project,” ISU recorded it for accounting purposes as “Project Costs incurred,” and paid the county all $853,700.
Careful scrutiny of financial statements shows there were no such “costs incurred” for the project by ISU or Bannock County, so the money should have reverted to the State of Idaho. The law is clear on how funds appropriated for a purpose may only be spent for that purpose, not transferred to create reserves or slush funds for officials to deploy at their discretion.
It appears officials at Bannock County and ISU circumvented the law.
Background: What the state wanted
In 2022, the State Board of Education, on behalf of Idaho State University, requested $900,000 from the Idaho Legislature for operating expenses for the EIFPC to be built on campus by renovating an existing building. The lab was intended to serve Bannock County by making it easier and less expensive to conduct autopsies and provide education opportunities for ISU students and professors relating to the forensic pathology industry. The Legislature appropriated the full $900,000.
The appropriations bill, H776, was clear about the intent of the Legislature to fund operating expenses specifically for the EIFPC by June 30, 2023. The issue first came to light when Commissioner John Crowder asked his fellow commissioners in October 2024 about the requirement for money to return to the state. Crowder directly referenced bill H776.
The bill clearly states:
“…there is hereby appropriated to the State Board of Education … $900,000 from the General Fund to be expended for operating expenditures for the period July 1, 2021, through June 30, 2022, for the Eastern Idaho Forensic Pathology Center at Idaho State University.”
Further, if the funds were not spent in the specified period, they would be reappropriated for the next year but no further:
“There is hereby reappropriated to the Office of the State Board of Education any unexpended and unencumbered balances appropriated to the Office of the State Board of Education from the General Fund for … the Eastern Idaho Forensic Pathology Center in fiscal year 2022, … to be used for nonrecurring expenditures for the period July 1, 2022, through June 30, 2023.”
Finally, the authorization for the appropriation states, "Legislative appropriations shall not be transferred from one fund to another fund unless expressly approved by the Legislature." As such approval was never obtained, none of the monies should have been transferred from ISU to Bannock County.
What ISU and Bannock County did
Idaho State University never built the EIFPC. Thus, any appropriations made to pay for operating expenditures for a non-existent lab should have reverted to the state. They were not.
Upon reviewing a series of emails between officials of Bannock County and Idaho State University obtained by PAGE, ISU financial records, Bannock County financial records, and minutes of Bannock County Commissioners’ meetings, we have learned the following:
Who was involved
From the email threads and review of Bannock County Commission meetings, the main actors involved in Bannock County are Chief of Staff Braeden Clayson and County Commissioner Jeff Hough. As of this writing, no corrective action has been taken, and the remaining funds are still in the county accounts, even after those officials were informed by Commissioner John Crowder of potential malfeasance, given the legislative stipulations.
The Idaho State University email thread’s main participants are Acting Vice President for Research Donna Lybecker, Vice President for Health Sciences and Senior Vice Provost Rex Force, Associate Vice President of Facilities Services Cheryl Hanson, Vice President of Operations Brian Sagendorf, and Associate General Counsel Office Nicholas Tranmer. It is unclear who at ISU approved the invoice for payment to Bannock County, but the payment was made just two months prior to the legislated deadline for the expenditure of the appropriated funds.
The Idaho Freedom Foundation reached out to Commissioner Jeff Hough and Idaho State University about the potential fraud involved with the transfer of funds.
Hough stated there was a new plan for the pathology lab’s construction on Bannock County property instead of ISU property. He said, “ISU said we could transfer money to you [Bannock County] and you could still put it toward the project.”
Notably, Hough remarked that “the termination clause caught us by surprise.”
When asked who at ISU suggested the idea, Hough said:
“I can’t remember if ISU suggested it or not. We were looking to keep the project moving forward and I’m not sure who came up with that plan.”
He disagrees that the transfer constitutes fraud because the intent of the legislation was to cover the operating expenses for establishing the facility. However, the actions of ISU and Bannock County are contrary to the legislative intent, which was to establish a pathology lab with ISU — not Bannock County — and to do so within the required timeline.
After two days, ISU has yet to respond to IFF’s request for comment.
What needs to happen
Officials must be held accountable for any illegal actions taken in creating what looks like a “slush fund” for the county from money appropriated and limited by the Legislature. There was coordination between Bannock County officials and Idaho State University officials to send the unspent funds to Bannock County in April 2023, prior to the legislative deadline of June 30, 2023, even though there were no operating expenditures corresponding to the invoiced amount. Such a transfer represents a violation of Idaho statute and the parameters outlined in the appropriations bill.
When government plans fall apart, officials must follow the law. In this case, the law required them to return the money, not repurpose it according to their own whims. Whether it was ISU’s idea or Hough’s, this indicates the misappropriation of hundreds of thousands of dollars and violates the trust put in our officials by taxpayers, voters, and the Legislature.
The law must hold all officials accountable for their mismanagement of state funds and violations of the trust put in them by the people. The State Attorney General’s office should conduct a thorough investigation and, as appropriate, file charges against all officials who have broken Idaho law. For its part, the Legislature should, at a minimum, demand the funds be returned and reduce the State Board of Education appropriations going forward by some significant amount to discourage future misuse and lack of oversight of taxpayer money.