The mayor didn’t give a reason for recusing himself, but it’s probably because he was formerly an employee at Spirit. So it’s good that he did this. But if we’re going to observe ethics protocols like this — and we should — let’s do them correctly. The mayor should have announced at the start of this item that he had to recuse himself, and then he should have left the bench and probably also the council chambers. Instead, Brewer presided over the presentation and discussion of the item, and then stated he wouldn’t be voting. It’s a small matter, but we might as well do things right.
What is much more important — and curious — is this: Brewer feels he can’t vote on an item involving a company where he was an employee. But, he has no such compunction about voting on matters that send taxpayer money to his fishing buddy, even via no-bid contracts.
Even more curious: Brewer thought it was ethical to vote to send taxpayer money to the movie theater owner who also sells his barbeque sauce.
If someone can explain this line of reasoning by the mayor and/or the city, I’d appreciate being enlightened.
It’s good to know that this mayor is concerned about ethical behavior when shopping for a car or voting on matters concerning his former employer. But I’m surprised, as this concern for virtue doesn’t match the behavior of the mayor and many members of the Wichita City Council. Shall we run down the list?
Exhibit 1: In August 2011 the Wichita City Council voted to award Key Construction a no-bid contract to build the parking garage that is part of the Ambassador Hotel project, now known as Block One. The no-bid cost of the garage was to be $6 million, according to a letter of intent. Later the city decided to place the contract for competitive bid. Key Construction won the bidding, but for a price $1.3 million less.
Wichita mayor Carl Brewer with major campaign donor Dave Wells of Key Construction.
The no-bid contract for the garage was just one of many subsidies and grants given to Key Construction and Dave Burk as part of the Ambassador Hotel project. Both of these parties are heavy campaign contributors to nearly all city council members. Brewer and the head of Key Construction are apparently friends, embarking on fishing expeditions.
What citizens need to know is that Brewer and the Wichita City Council were willing to spend an extra $1.3 million of taxpayer money to reward a politically-connected construction firm that makes heavy campaign contributions to council members. Only one council member, Michael O’Donnell, voted against this no-bid contract. At the time, no city bureaucrats expressed concern about this waste of taxpayer money.
Exhibit 2: In July 2012 Brewer participated in a decision to award the large contract for the construction of the new Wichita airport to Key Construction, despite the fact that Key was not the low bidder. The council was tasked to act in a quasi-judicial manner, to make decisions whether discretion was abused or whether laws were improperly applied. Brewer’s judgment was in favor of Key Construction, even though its bid had the same defect as the lower bid. This decision cost taxpayers and airport users an extra $2 million, to the benefit of a major campaign donor and fishing buddy.
Exhibit 3: In a Wichita Eagle story that reported on “city-financed downtown parking garages that spiraled well over budget” we learned this: “The most recent, the 2008 WaterWalk Place garage built by Key Construction, an original partner in the WaterWalk project, came in $1.5 million over budget at almost $8.5 million. That’s the biggest parking garage miss, according to figures from the city’s office of urban development, although the 2004 Old Town Cinema garage built by Key Construction came in almost $1 million over budget at $5.225 million.”
Despite this personal experience, Brewer wrote a letter recommending Key Construction (and only Key), observing “Key is known for their consistent quality construction, budget control and on schedule delivery.”
Exhibit 4: In 2008 the Wichita City Council approved a no- and low-interest loan to movie theater owner Bill Warren and his partners. Reported the Wichita Eagle: “Wichita taxpayers will give up as much as $1.2 million if the City Council approves a $6 million loan to bail out the troubled Old Town Warren Theatre this week. That’s because that $6 million, which would pay off the theater’s debt and make it the only fully digital movie theater in Kansas, would otherwise be invested and draw about 3 percent interest a year.”
Warren’s theaters have received other financial benefits from the city under Brewer’s leadership, too. Then — and I swear I am not making this up — when Brewer started manufacturing and selling barbeque sauce, it was sold at Warren’s theaters.
Really. It happened.
What can we say about a mayor who is concerned about the appearance of impropriety when voting on economic development incentives for his former employer, but is not able to understand the problems with his own behavior in office?
That he feels he needs to shop for a car outside the city, but at the same time has no problem voting for overpriced no-bid contracts for campaign contributors and friends?
That he feels he can’t vote to give a tax break to his former employer, but votes to give millions to a campaign contributor, and then sells his barbeque sauce in that person’s business?
It’s difficult to understand or reconcile these decisions.
On Tuesday the Wichita City Council will conduct a hearing for review of the award of a contract for the construction of the new Wichita Airport terminal. But because of relationships between nearly all council members — especially Wichita Mayor Carl Brewer — and one of the parties to the dispute, the city council should not participate in this decision.
The contract, worth about $100 million, was awarded to Dondlinger and Sons and its partner. Dondlinger has built many large projects, including INTRUST Bank Arena. But the city then ruled that Dondliger’s bid is “unresponsive.” The reason is that Dondlinger may not have met bid requirements regarding disadvantaged and minority business enterprises.
The firm next in line to receive the contract is Key Construction of Wichita. If the city council finds against Dondllinger, Key gets the contract, presumably. That’s the source of the problem the city council faces, as Key is heavily involved in politics, with its executives and their spouses often making the maximum allowed campaign contributions to nearly all members of the council. Personal relationships may play a role, too.
For the mayor and current council members, here is my tabulation of how much Key-associated persons made to each member’s most recent campaign:
Is there a pattern to these contributions? That is, does Key make contributions to candidates with a specific political philosophy, such as conservatism or liberalism? Of the top three contributors, two have distinctly liberal ideas about taxation and spending, while the other is touting conservative credentials as he campaigns for another office. Patterns like this suggest that the contributions are made to gain access to officeholders, or for favorable consideration when the donor asks the council to vote to give it money or contracts. Key Construction does that a lot.
Wichita mayor Carl Brewer with major campaign donor Dave Wells of Key Construction.
The political influence of Key Construction extends beyond campaign contributions, too. Mayor Brewer’s personal Facebook profile has a photo album holding pictures of him on a fishing trip with Dave Wells of Key Construction.
These political investments have paid off for Key Construction, as it has received a number of no-bid contracts over the years. Last August the council decided to award Key a no-bid contract to build the parking garage that is part of the Ambassador Hotel project. The no-bid cost of the garage was to be $6 million, according to a letter of intent. All council members except Michael O’Donnell (district 4, south and southwest Wichita) voted for the no-bid contract to Key Construction, although Mayor Carl Brewer was absent. It is likely that he would have voted with the majority, however.
Later the city decided to place the contract for bid. Key Construction won the bidding, but for a price some $1.3 million less.
What citizens need to know is that the city council, except O’Donnell, was willing to spend an extra $1.3 million on a project awarded to a politically-connected construction firm.
So should the Wichita City Council make the decision on the airport contract? City documents don’t indicate whether Tuesday’s hearing is of a quasi-judicial nature, as it is sometimes when the council rules on certain matters involving appeal of decisions made by city authorities. But the council is being asked to make decisions involving whether discretion was abused or whether laws were improperly applied.
That sounds a lot like the role of judges. In 2009 the U.S. Supreme Court ruled that, in the words of legal watchdog group Judicial Watch, “… significant campaign contributions or other electoral assistance pose a risk of actual bias. Writing for the majority, Justice Anthony Kennedy said: ‘Just as no man is allowed to be a judge in his own cause so too can fears of bias arise when a man chooses the judge in his own cause.’”
Judicial Watch also noted “The ruling will likely affect judges in 39 states that elect them — including Washington, Texas and California — from presiding over cases in which their campaign contributions could create a conflict of interest. The nation’s judicial code has long said that judges should disqualify themselves from proceedings in which impartiality might reasonably be questioned, but the Supreme Court ruling is the first to address hefty election spending.”
The mayor and council members are not judges. But they’re being asked to make a judge-like decision. If held to the same standards as the U.S. Supreme Court says judges must follow, Mayor Brewer and the five council members who accepted campaign contributions from Key Construction need to recuse themselves from Tuesday’s decision on the Wichita Airport construction contract. A similar argument can be made for city manager Robert Layton and all city employees. Directly or indirectly they serve at the pleasure of the council.
When buying and selling are controlled by legislation, the first things to be bought and sold are legislators.
— P.J. O’Rourke
Your principle has placed these words above the entrance of the legislative chamber: “whosoever acquires any influence here can obtain his share of legal plunder.” And what has been the result? All classes have flung themselves upon the doors of the chamber crying:
“A share of the plunder for me, for me!”
— Frederic Bastiat
Update: The council deferred this item to a later date.
Tomorrow the Wichita City Council considers a policy designed to squelch the council’s ability to issue no-bid contracts for city projects. This policy is necessary to counter the past bad behavior of Wichita Mayor Carl Brewer and several council members, as well as their inability to police themselves regarding matters of ethical behavior by government officials.
The proposed policy is problematic. For some projects the developer will have to pay for “a third party expert to verify construction estimates and contracts with respect to reasonable market costs and appropriate allocation of costs between public and private funding.”
Why are measures like this necessary? The impetus for this policy is the no-bid contract awarded to Key Construction for the construction of the garage near the Ambassador Hotel, originally called Douglas Place, now known as Block One.
A letter of intent passed by the council on August 9, 2011 gives the cost of the garage: “Douglas Place LLC will administer the construction of the garage and urban park on behalf of the City and the City will pay the cost of designing and constructing the same at a cost not-to-exceed $6,800,000.” Of that, $770,000 was for the urban park, leaving about $6 million cost for the garage. The motion to approve the letter of intent passed with all council members except Michael O’Donnell voting in favor.
By the time the item appeared for consideration at the September 13, 2011 city council meeting, city documents gave the cost of the constructing the garage structure at an even $6 million. The motion to spend that amount on the garage passed with all members except O’Donnell voting in favor, except Brewer was absent and did not vote.
Then the city manager decided that the project should be put to competitive bid. Key Construction won that competition with a bid of about $4.7 million. Same garage, same company, but $1.3 million saved.
The Wichita Eagle tells the story like this: “The Ambassador garage at Douglas Place, awarded at $4.73 million to Key Construction — a partner in the hotel project and the project’s contractor — came in about 20 percent under estimates provided the City Council, on the heels of some city-financed downtown parking garages that spiraled over budget.” (“Wichita City Council to consider bidding policy extension”, Wichita Eagle, Sunday, February 2, 2014)
Reading the Eagle story, citizens might conclude that due to excellent management by Key Construction, the garage was built at a 20 percent savings under “estimates.”
But that’s not at all what happened. It’s not even close to what really happened.
Without the intervention of O’Donnell, the city manager, and — according to press reports — city council member Pete Meitzner, the garage would have been built for $6 million. That was the intent of a majority of the council. The $6 million price tag for the no-bid contract was in the ordinance that passed, and in the letter of intent that passed a month before. There were no “estimates” as the Eagle reported. There was only the expressed desire of the council to spend $6 million.
So there were no “estimates” that Key Construction bested. But there was an objectionable no-bid contract that the council agreed to. Fortunately for Wichita, a few people objected and overrode the council’s bad decision.
We’re left to wonder why the Eagle retold the story with Key Construction in the role of hero. That’s about 180 degrees away from the role this company plays.
Key Construction is intimately involved in city politics. Its principals and executives contribute heavily to mayoral and city council election campaigns. Company president David Wells is a personal friend of the mayor.
Did Key’s political involvement and campaign contributions play a role in the council awarding the company a no-bid garage contract? Key Construction executives and their spouses are among a small group who routinely make maximum campaign contributions to candidates. These candidates are both liberal and conservative, which rebuts the presumption that these contributions are made for ideological reasons, that is, agreeing with the political positions of candidates. Instead, Key Construction and a few companies are political entrepreneurs. They seek to please politicians and bureaucrats, and by doing so, receive no-bid contracts and other taxpayer-funded benefits. This form of cronyism is harmful to Wichita taxpayers, as shown by the Ambassador Hotel garage.
The harm of pay-to-play
When it is apparent that a “pay-to-play” environment exists at Wichita City Hall, it creates a toxic and corrosive political and business environment. Companies are reluctant to expand into areas where they don’t have confidence in the integrity of local government. Will I find my company bidding against a company that made bigger campaign contributions than I did? If I don’t make the right campaign contributions, will I get my zoning approved? Will my building permits be slow-walked through the approval process? Will my projects face unwarranted and harsh inspections? Will my bids be subjected to microscopic scrutiny?
We need laws to prohibit Wichita city council members from voting on or advocating for decisions that enrich their significant campaign contributors. The Ambassador Hotel garage contract is just one example. Citizens are working on this initiative on several fronts. Some find the actions of these candidates so distasteful and offensive that they are willing to take to the streets to gather thousands of signatures to force the Wichita City Council to act in a proper manner.
That huge effort shouldn’t be necessary. Why? The politicians who accept these campaign contributions say it doesn’t affect their voting, and those who give the contributions say they don’t give to influence votes.
If politicians and contributors really mean what they say, there should be no opposition to such a “pay-to-play” law. Citizens should ask the Wichita City Council to pass a campaign finance reform ordinance that prohibits voting to enrich significant campaign contributors.
There is a law, sort of
Citizens who believe that city council members ought not to vote on matters involving their friends and business associates, we already have such a law. Sort of. Here’s a section from the Wichita city code as passed in 2008 (full section below):
“[Council members] shall refrain from making decisions involving business associates, customers, clients, friends and competitors.”
Mayor Carl Brewer voted for this law, by the way. When asked about a specific application of this city law, the Wichita city attorney supplied this interpretation:
Related to the Mayor’s participation in the item, yes, City Code advises Council members to “refrain from making decisions involving business associates, customers, clients, friends and competitors. … ” but the Code does not provide definitions or limits to these broad categories of constituents. Further, the City Code clearly requires Council members to “vote on all matters coming before the City Council except in those particular cases of conflict of interest. …” The city Code does not define what constitutes a conflict but the Council has historically applied the State law for that definition.
Applying that State law specific to local municipalities, the Mayor does not have any substantial interest in Douglas Place LLC, and therefore no conflict. Under the State ethics law, there was no requirement that the Mayor recuse himself from voting on the Ambassador Project.
So we have statutory language that reads “shall refrain,” but the city attorney interprets that to mean “advises.”
We also have statutory language that reads “business associates, customers, clients, friends and competitors.” But the city attorney feels that these terms are not defined, and therefore the mayor and city council members need not be concerned about compliance with this law. We’re left to wonder whether this law has any meaning at all.
Be advised: If you ask the mayor to adhere to this law, he may threaten to sue you.
If the city attorney’s interpretation of this law is controlling, I suggest we strike this section from the city code. Someone who reads this — perhaps a business owner considering Wichita for expansion — might conclude that our city has a code of ethics that is observed by the mayor and council members and enforced by its attorneys.
Giving that impression, though, would be false — and unethical.
Here’s the Wichita city code:
Sec. 2.04.050. — Code of ethics for council members.
Council members occupy positions of public trust. All business transactions of such elected officials dealing in any manner with public funds, either directly or indirectly, must be subject to the scrutiny of public opinion both as to the legality and to the propriety of such transactions. In addition to the matters of pecuniary interest, council members shall refrain from making use of special knowledge or information before it is made available to the general public; shall refrain from making decisions involving business associates, customers, clients, friends and competitors; shall refrain from repeated and continued violation of city council rules; shall refrain from appointing immediate family members, business associates, clients or employees to municipal boards and commissions; shall refrain from influencing the employment of municipal employees; shall refrain from requesting the fixing of traffic tickets and all other municipal code citations; shall refrain from seeking the employment of immediate family members in any municipal operation; shall refrain from using their influence as members of the governing body in attempts to secure contracts, zoning or other favorable municipal action for friends, customers, clients, immediate family members or business associates; and shall comply with all lawful actions, directives and orders of duly constituted municipal officials as such may be issued in the normal and lawful discharge of the duties of these municipal officials.
Council members shall conduct themselves so as to bring credit upon the city as a whole and so as to set an example of good ethical conduct for all citizens of the community. Council members shall bear in mind at all times their responsibility to the entire electorate, and shall refrain from actions benefiting special groups at the expense of the city as a whole and shall do everything in their power to ensure equal and impartial law enforcement throughout the city at large without respect to race, creed, color or the economic or the social position of individual citizens.
Before Wichita city hall asks its subjects for more tax revenue, it needs to regain the trust of Wichitans. Following, from February, an illustration of the problems city hall has created for itself. And, how it would be helpful if the editorial board of the state’s largest newspaper acted as though it cared about ethics, cronyism, government transparency, and corruption.
When buying and selling are controlled by legislation, the first things to be bought and sold are legislators.
— P.J. O’Rourke
Your principle has placed these words above the entrance of the legislative chamber: “whosoever acquires any influence here can obtain his share of legal plunder.” And what has been the result? All classes have flung themselves upon the doors of the chamber crying:
“A share of the plunder for me, for me!”
— Frederic Bastiat
Tomorrow the Wichita City Council considers a policy designed to squelch the council’s ability to issue no-bid contracts for city projects. This policy is necessary to counter the past bad behavior of Wichita Mayor Carl Brewer and several council members, as well as their inability to police themselves regarding matters of ethical behavior by government officials.
The proposed policy is problematic. For some projects the developer will have to pay for “a third party expert to verify construction estimates and contracts with respect to reasonable market costs and appropriate allocation of costs between public and private funding.”
Why are measures like this necessary? The impetus for this policy is the no-bid contract awarded to Key Construction for the construction of the garage near the Ambassador Hotel, originally called Douglas Place, now known as Block One.
A letter of intent passed by the council on August 9, 2011 gives the cost of the garage: “Douglas Place LLC will administer the construction of the garage and urban park on behalf of the City and the City will pay the cost of designing and constructing the same at a cost not-to-exceed $6,800,000.” Of that, $770,000 was for the urban park, leaving about $6 million cost for the garage. The motion to approve the letter of intent passed with all council members except Michael O’Donnell voting in favor.
By the time the item appeared for consideration at the September 13, 2011 city council meeting, city documents gave the cost of the constructing the garage structure at an even $6 million. The motion to spend that amount on the garage passed with all members except O’Donnell voting in favor, except Brewer was absent and did not vote.
Then the city manager decided that the project should be put to competitive bid. Key Construction won that competition with a bid of about $4.7 million. Same garage, same company, but $1.3 million saved.
The Wichita Eagle tells the story like this: “The Ambassador garage at Douglas Place, awarded at $4.73 million to Key Construction — a partner in the hotel project and the project’s contractor — came in about 20 percent under estimates provided the City Council, on the heels of some city-financed downtown parking garages that spiraled over budget.” (“Wichita City Council to consider bidding policy extension”, Wichita Eagle, Sunday, February 2, 2014)
Reading the Eagle story, citizens might conclude that due to excellent management by Key Construction, the garage was built at a 20 percent savings under “estimates.”
But that’s not at all what happened. It’s not even close to what really happened.
Without the intervention of O’Donnell, the city manager, and — according to press reports — city council member Pete Meitzner, the garage would have been built for $6 million. That was the intent of a majority of the council. The $6 million price tag for the no-bid contract was in the ordinance that passed, and in the letter of intent that passed a month before. There were no “estimates” as the Eagle reported. There was only the expressed desire of the council to spend $6 million.
So there were no “estimates” that Key Construction bested. But there was an objectionable no-bid contract that the council agreed to. Fortunately for Wichita, a few people objected and overrode the council’s bad decision.
We’re left to wonder why the Eagle retold the story with Key Construction in the role of hero. That’s about 180 degrees away from the role this company plays.
Key Construction is intimately involved in city politics. Its principals and executives contribute heavily to mayoral and city council election campaigns. Company president David Wells is a personal friend of the mayor.
Did Key’s political involvement and campaign contributions play a role in the council awarding the company a no-bid garage contract? Key Construction executives and their spouses are among a small group who routinely make maximum campaign contributions to candidates. These candidates are both liberal and conservative, which rebuts the presumption that these contributions are made for ideological reasons, that is, agreeing with the political positions of candidates. Instead, Key Construction and a few companies are political entrepreneurs. They seek to please politicians and bureaucrats, and by doing so, receive no-bid contracts and other taxpayer-funded benefits. This form of cronyism is harmful to Wichita taxpayers, as shown by the Ambassador Hotel garage.
The harm of pay-to-play
When it is apparent that a “pay-to-play” environment exists at Wichita City Hall, it creates a toxic and corrosive political and business environment. Companies are reluctant to expand into areas where they don’t have confidence in the integrity of local government. Will I find my company bidding against a company that made bigger campaign contributions than I did? If I don’t make the right campaign contributions, will I get my zoning approved? Will my building permits be slow-walked through the approval process? Will my projects face unwarranted and harsh inspections? Will my bids be subjected to microscopic scrutiny?
Wait a minute: Doesn’t Wichita have a newspaper that keeps a watchful eye on cronyism and corruption? With an editorial board that crusades against these ills?
The answer is no. No such newspaper exists in Wichita.
We need laws to prohibit Wichita city council members from voting on or advocating for decisions that enrich their significant campaign contributors. The Ambassador Hotel garage contract is just one example. Citizens are working on this initiative on several fronts. Some find the actions of these candidates so distasteful and offensive that they are willing to take to the streets to gather thousands of signatures to force the Wichita City Council to act in a proper manner.
That huge effort shouldn’t be necessary. Why? The politicians who accept these campaign contributions say it doesn’t affect their voting, and those who give the contributions say they don’t give to influence votes.
If politicians and contributors really mean what they say, there should be no opposition to such a “pay-to-play” law. Citizens should ask the Wichita City Council to pass a campaign finance reform ordinance that prohibits voting to enrich significant campaign contributors.
There is a law, sort of
Citizens who believe that city council members ought not to vote on matters involving their friends and business associates, we already have such a law. Sort of. Here’s a section from the Wichita city code as passed in 2008 (full section below):
“[Council members] shall refrain from making decisions involving business associates, customers, clients, friends and competitors.”
Mayor Carl Brewer voted for this law, by the way. When asked about a specific application of this city law, the Wichita city attorney supplied this interpretation:
Related to the Mayor’s participation in the item, yes, City Code advises Council members to “refrain from making decisions involving business associates, customers, clients, friends and competitors. … ” but the Code does not provide definitions or limits to these broad categories of constituents. Further, the City Code clearly requires Council members to “vote on all matters coming before the City Council except in those particular cases of conflict of interest. …” The city Code does not define what constitutes a conflict but the Council has historically applied the State law for that definition.
Applying that State law specific to local municipalities, the Mayor does not have any substantial interest in Douglas Place LLC, and therefore no conflict. Under the State ethics law, there was no requirement that the Mayor recuse himself from voting on the Ambassador Project.
So we have statutory language that reads “shall refrain,” but the city attorney interprets that to mean “advises.”
We also have statutory language that reads “business associates, customers, clients, friends and competitors.” But the city attorney feels that these terms are not defined, and therefore the mayor and city council members need not be concerned about compliance with this law. We’re left to wonder whether this law has any meaning at all.
Be advised: If you ask the mayor to adhere to this law, he may threaten to sue you.
If the city attorney’s interpretation of this law is controlling, I suggest we strike this section from the city code. Someone who reads this — perhaps a business owner considering Wichita for expansion — might conclude that our city has a code of ethics that is observed by the mayor and council members and enforced by its attorneys.
Giving that impression, through, would be false — and unethical.
Here’s the Wichita city code:
Sec. 2.04.050. — Code of ethics for council members.
Council members occupy positions of public trust. All business transactions of such elected officials dealing in any manner with public funds, either directly or indirectly, must be subject to the scrutiny of public opinion both as to the legality and to the propriety of such transactions. In addition to the matters of pecuniary interest, council members shall refrain from making use of special knowledge or information before it is made available to the general public; shall refrain from making decisions involving business associates, customers, clients, friends and competitors; shall refrain from repeated and continued violation of city council rules; shall refrain from appointing immediate family members, business associates, clients or employees to municipal boards and commissions; shall refrain from influencing the employment of municipal employees; shall refrain from requesting the fixing of traffic tickets and all other municipal code citations; shall refrain from seeking the employment of immediate family members in any municipal operation; shall refrain from using their influence as members of the governing body in attempts to secure contracts, zoning or other favorable municipal action for friends, customers, clients, immediate family members or business associates; and shall comply with all lawful actions, directives and orders of duly constituted municipal officials as such may be issued in the normal and lawful discharge of the duties of these municipal officials.
Council members shall conduct themselves so as to bring credit upon the city as a whole and so as to set an example of good ethical conduct for all citizens of the community. Council members shall bear in mind at all times their responsibility to the entire electorate, and shall refrain from actions benefiting special groups at the expense of the city as a whole and shall do everything in their power to ensure equal and impartial law enforcement throughout the city at large without respect to race, creed, color or the economic or the social position of individual citizens.
Those seeking favors from Wichita City Hall use campaign contribution stacking to bypass contribution limits. This has paid off handsomely for them, and has harmed everyone else.
Not long ago a person who is politically active wrote a letter that was published in the Wichita Eagle. It criticized the role of campaign contributions in federal elections, noting “Corporations don’t spend money on politics because they are patriotic; rather, the companies expect a financial return.” Later the letter held this: “Locally, I understand that elections for the Wichita City Council underwent ideal, nonpartisan campaign-finance reform years ago, and that these limits are scrupulously practiced.”
The writer is correct, but only superficially. Our campaign contribution limits for city and school board offices are relatively small. What we find, however, is that the cronies, that is, the people who want stuff from city hall, stack contributions using family members and employees.
Stacked campaign contributions received by James Clendenin from parties associated with Key Construction. Click for larger version.Here’s how a handful of cronies stack campaign contributions. In 2012 council members James Clendenin (district 3, southeast and south Wichita) and Lavonta Williams (district 1, northeast Wichita) were preparing to run again for their offices in spring 2013. Except for $1.57 in unitemized contributions to Clendenin, two groups of related parties accounted for all contributions received by these two incumbents for an entire year. A group associated with Key Construction gave a total of $7,000 — $4,000 to Williams, and $3,000 to Clendenin. Another group of people associated with movie theater owner Bill Warren gave $5,000, all to Clendenin.
The casual observer wouldn’t realize this stacking of campaign contributions by looking at campaign finance reports. That’s because for city offices, the name of the company a contributor works for isn’t required. Industry and occupation are required, but these aren’t of much help. Further, contribution reports are not filed electronically, so the information is not easy to analyze. Some reports are even submitted using handwriting, and barely legible handwriting at that.
So it’s not easy to analyze campaign contributions for Wichita city offices. It takes a bit of effort to unpack the stacking. You have to see a name and investigate who that person is. When you do that, you might find that a man from Valley Center who list his occupation and industry as Manager and Aviation Subcontractor is married to someone who lists her occupation and industry as Director of Marketing. Investigating her reveals that she is an executive of Key Construction.
That company, Key Construction, is a prominent company in Wichita. It is an example of a company that seeks to earn outsized profits through the political system rather than by meeting customer needs in the market. Profits through cronyism, that is. Here’s an example. In August 2011 the Wichita city council voted to award Key Construction a no-bid contract to build the parking garage that is part of the Ambassador Hotel project, now known as Block One. The no-bid cost of the garage was to be $6 million, according to a letter of intent. Later the city decided to place the contract for competitive bid. Key Construction won the bidding, but for a price $1.3 million less.
Let me make sure you understand that. Mayor Carl Brewer, Lavonta Williams, and James Clendenin were willing to spend an extra $1.3 million of your tax money to reward their benefactors through a no-bid contract. Since then reforms have been implemented to prevent this. Hopefully the reforms will work. I am skeptical.
Wichita Mayor Carl Brewer with major campaign donor Dave Wells of Key Construction. Brewer has voted for no-bid contracts for Key.In 2012 there was another incident involving Key Construction that show the need for campaign finance reform. Key and another construction company were engaged in a dispute as to who should build the new Wichita airport. The city council was tasked to act in a quasi-judicial manner to decide the issue. Given all the campaign contributions Key was making at the time, and given the mayor’s well-known friendship with Dave Wells of Key Construction, can you guess who was awarded the contract? And can you guess whose contract was more expensive for taxpayers?
So back to the letter in the newspaper, which held: “Corporations don’t spend money on politics because they are patriotic; rather, the companies expect a financial return.” I’m not going to defend cronyism at the federal level. It exists and it is harmful. But I would like to let the writer of the letter know that cronyism also exists in Wichita city government. In fact, it may be worse in Wichita. At the federal level, Congress usually passes laws that benefit an entire industry — say the sugar industry or banks — to the detriment of consumers and taxpayers. (Sometimes the benefits are quite specific. American Enterprise Institute reports that the just-passed omnibus bill contains a section that provides protection from an Obamacare provision for exactly one entity: Blue Cross Blue Shield. Conservative writer Yuval Levin explained: “This section is, simply put, a special favor for Blue Cross/Blue Shield allowing them to count ‘quality improvement’ spending as part of the medical loss ratio calculation required of them under Obamacare. And it’s made retroactive for four years, saving them loads of money.”)
That’s bad enough. Here in Wichita, however, the cronyism is more concentrated and personal. The links between campaign contributions and handouts from city hall is much more direct. We should insist that the city council stop picking the pocket of your fellow man so it can give the proceeds to campaign contributors. Campaign finance reform can help.
Wichita will soon select a new city attorney. There are a few questions we ought to ask of candidates, such as: Will the next city attorney advise council members to refrain from making decisions worth millions to their friends and significant campaign contributors?
Two years ago as the Wichita City Council prepared to handle the appeal of the award of a construction contract, the Wichita Eagle editorialized that “appearance matters” on city contracts: “There will be an elephant in the Wichita City Council chambers today as Mayor Carl Brewer and the rest of the council formally consider Dondlinger and Sons’ long-shot final appeal of its loss of the contract to build the new airport terminal — the close ties of Brewer and other City Council members to Key Construction, including a letter Brewer wrote last year recommending Key to build the Cabela’s store in northeast Wichita.” (Eagle editorial: Appearance matters on city contracts, July 17, 2012)
The Eagle probably didn’t know at that time what we learned a short while later: There was unusual interest in Michigan about the airport contract decision, and the campaign bank account of Wichita City Council Member Jeff Longwell benefited financially.
On July 16, 2012 — the day before the Wichita City Council heard the appeal that resulted in Key Construction winning the airport contract — John Rakolta, Chairman and Chief Executive Officer of Walbridge and his wife contributed $1,000 to Longwell’s campaign for Sedgwick county commissioner. Walbridge is a Michigan-based construction company that is partnering with Key Construction on the airport job. The contract is worth about $100 million.
Then on July 20, three days after the council’s decision in favor of Key/Walbridge, other Walbridge executives contributed $2,250 to Longwell’s campaign. Key Construction and its executives contributed $6,500 to Longwell’s county commission campaign, and they’ve also been heavy contributors to Longwell’s other campaigns.
It is wrong to accept thousands in contributions from those who benefit directly from your vote. In many states it is illegal. But not in Kansas. Though legal, the timing of these contributions to Longwell’s campaign is indelicate.
The political influence of Key Construction and its partners extends beyond campaign contributions. Mayor Brewer’s personal Facebook profile has a photo album holding pictures of him on a fishing trip with Dave Wells of Key Construction.
Should the Wichita City Council have made the decision on the airport contract? City documents did not indicate whether the hearing was of a quasi-judicial nature, as it is sometimes when the council rules on certain matters involving appeal of decisions made by city authorities. But the council was asked to make decisions involving whether discretion was abused or whether laws were improperly applied.
That sounds a lot like the role of judges. In 2009 the U.S. Supreme Court ruled that, in the words of legal watchdog group Judicial Watch, “… significant campaign contributions or other electoral assistance pose a risk of actual bias. Writing for the majority, Justice Anthony Kennedy said: ‘Just as no man is allowed to be a judge in his own cause so too can fears of bias arise when a man chooses the judge in his own cause.’”
Judicial Watch also noted “The ruling will likely affect judges in 39 states that elect them — including Washington, Texas and California — from presiding over cases in which their campaign contributions could create a conflict of interest. The nation’s judicial code has long said that judges should disqualify themselves from proceedings in which impartiality might reasonably be questioned, but the Supreme Court ruling is the first to address hefty election spending.”
The mayor and council members are not judges. But they were asked to make a judge-like decision. If held to the same standards as the U.S. Supreme Court says judges must follow, Mayor Brewer and the five council members who accepted campaign contributions from Key Construction should not have participated in the decision on the Wichita airport construction contract. A similar argument can be made for city manager Robert Layton and all city employees. Directly or indirectly they serve at the pleasure of the council.
Question: Did the outgoing city attorney advise the mayor and council members on this topic? We’ll probably never know due to attorney-client privilege. But a good question to ask city attorney candidates is how they would advise council members if another matter like this comes before the council.
From January 2012, how tax increment financing routes benefits to politically-connected firms.
It is now confirmed: In Wichita, tax increment financing (TIF) leads to taxpayer-funded waste that benefits those with political connections at city hall.
The latest evidence we have is the construction of a downtown parking garage that benefits Douglas Place, especially the Ambassador Hotel, a renovation of a historic building now underway.
The flow of tax dollars Wichita city leaders had planned for Douglas Place called for taxpayer funds to be routed to a politically-connected construction firm. And unlike the real world, where developers have an incentive to build economically, the city created incentives for Douglas Place developers to spend lavishly in a parking garage, at no cost to themselves. In fact, the wasteful spending would result in profit for them.
The original plan for Douglas Place as specified in a letter of intent that the city council voted to support, called for a parking garage and urban park to cost $6,800,000. Details provided at the August 9th meeting of the Wichita City Council gave the cost for the garage alone as $6,000,000. The garage would be paid for by capital improvement program (CIP) funds and tax increment financing (TIF). The CIP is Wichita’s long-term plan for building public infrastructure. TIF is different, as we’ll see in a moment.
At the August 9th meeting it was also revealed that Key Construction of Wichita would be the contractor for the garage. The city’s plan was that Key Construction would not have to bid for the contract, even though the garage is being paid for with taxpayer funds.Council Member Michael O’Donnell (district 4, south and southwest Wichita) expressed concern about the no-bid contract. As a result, the contract was put out for competitive bid.
Now a winning bid has been determined, according to sources in city hall, and the amount is nearly $1.3 million less than the council was willing to spend on the garage. This is money that otherwise would have gone into the pockets of Key Construction. Because of the way the garage is being paid for, that money would not have been a cost to Douglas Place’s developers. Instead, it would have been a giant ripoff of Wichita taxpayers. This scheme was approved by Mayor Carl Brewer and all city council members except O’Donnell.
Even worse, the Douglas Place developers have no incentive to economize on the cost of the garage. In fact, they have incentives to make it cost even more.
Two paths for developer taxes
Recall that the garage is being paid for through two means. One is CIP, which is a cost to Wichita taxpayers. It doesn’t cost the Douglas Place developers anything except for their small quotal share of Wichita’s overall tax burden. In exchange for that, they get part of a parking garage paid for.
Flows of funds in regular and TIF development.But the tax increment financing, or TIF, is different. Under TIF, the increased property taxes that Douglas Place will pay as the project is completed won’t go to fund the general operations of government. Instead, these taxes will go to pay back bonds that the city will issue to pay for part of the garage — a garage that benefits Douglas Place, and one that would not be built but for the Douglas Place plans.
Under TIF, the more the parking garage costs, the more Douglas Place property taxes are funneled back to it — taxes, remember, it has to pay anyway. (Since Douglas Place won’t own the garage, it doesn’t have to pay taxes on the value of the garage, so it’s not concerned about the taxable value of the garage increasing its tax bill.)
Most people and businesses have their property taxes go towards paying for public services like police protection, firemen, and schools. But TIF allows these property taxes to be used for a developer’s exclusive benefit. That leads to distortions.
Why would Douglas Place be interested in an expensive parking garage? Here are two reasons:
First, the more the garage costs, the more the hotel benefits from a fancier and nicer garage for its guests to park in. Remember, since the garage is paid for by property taxes on the hotel — taxes Douglas Place must pay in any case — there’s an incentive for the hotel to see these taxes used for its own benefit rather than used to pay for firemen, police officers, and schools.
Second, consider Key Construction, the planned builder of the garage under a no-bid contract. The more expensive the garage, the higher the profit for Key.
Now add in the fact that one of the partners in the Douglas Place project is a business entity known as Summit Holdings LLC, which is composed of David Wells, Kenneth Wells, Richard McCafferty, John Walker Jr., and Larry Gourley. All of these people are either owners of Key Construction or its executives. The more the garage costs, the higher the profit for these people. Remember, they’re not paying for the garage. City taxpayers are.
The sum of all this is a mechanism to funnel taxpayer funds, via tax increment financing, to Key Construction. The more the garage costs, the better for Douglas Place and Key Construction — and the worse for Wichita taxpayers.
This scheme — of which few people must be aware as it has not been reported anywhere but here — is a reason why Wichita and Kansas need pay-to-play laws. These laws impose restrictions on the activities of elected officials and the awarding of contracts.
An example is a charter provision of the city of Santa Ana, in Orange County, California, which states: “A councilmember shall not participate in, nor use his or her official position to influence, a decision of the City Council if it is reasonably foreseeable that the decision will have a material financial effect, apart from its effect on the public generally or a significant portion thereof, on a recent major campaign contributor.”
This project also shows why complicated financing schemes like tax increment financing need to be eliminated. Government intervention schemes like this turn the usual economic incentives upside down, and at taxpayer expense.
There are eight major lessons for Wichita voters when they cast their ballots on or before November 5, 2019, concerning the revelations of favoritism involving the mayor, apparently a majority of the city council, and a number of Wichita businesses and businessmen concerning a proposed massive city water plant contract that is close to half a billion dollars.
The Wichita Eagle’s detailed reporting on this proposed contract, Mayor Longwell’s role deserves scrutiny at several different levels.
Let me begin with full disclosure. Both Mayor Longwell and I are registered Republicans, and also GOP precinct committeemen in our respective west Wichita precincts. The mayor is now one of the most prominent Republican mayors in the entire country. In 2012, then-city council member Longwell ran against me in the Republican primary for the Sedgwick County Commission. He lost. Subsequently, in 2015, Jeff Longwell defeated Sam Williams in the non-partisan general election for Wichita mayor.
Finally Exposing Improper City Contract Conduct
The Wichita Eagle deserves credit for researching city records following an expensive KORA records request. The paper also deserves credit for reporting the story about favoritism, cronyism, and how public-private partnerships” actually have been operating as part of the proposed new water plant at city hall.
However, this story implicitly treats this type of conduct as new. In reality, there is an extensive history of similar conduct going back for years at city hall. That raises the question, why now?
News Hole
The huge volume of space the Wichita Eagle initially provided to cover this front page, above the fold story on a Sunday paper is remarkable. It was extremely large. I doubt that the 1969 moon landing, the 9-11-2001 Islamist terrorist attacks, or pick any of the presidential campaign election results since the 1960s had as much space with as many words above the fold on the front page, and followed with two full pages inside the Sunday paper, and editorial commentary as this city hall story. As a percentage of the total news hole in the paper, a higher percentage was probably contained within this edition of the paper.
I believe that you would probably need to go back to the JFK assassination for coverage that may have included more space than this Sunday, September 29, 2019 story received.
This is quite a contrast in local news coverage from past examples of city contracts that were handled in a similar way over many years. Let’s look at why this might have occurred.
Weakened Local News Media
The news organizations in Wichita have been decimated by digitization. The digital world has dramatically changed the environment for print and broadcasting, whether it is radio or TV. All of these organizations are smaller, have reduced staffs, and lack the ability to do extensive and expensive research needed to provide any sort of investigative reporting. That is why the Eagle’s reporting on this story is remarkable since the room for news in this shrunken paper is a small fraction of what it was 10 or even just five years ago.
The Eagle’s reporting is also notable because its parent company, McClatchy Corporation (MCN), is in severe financial distress, with a corporate capital base hovering around $20 million while the firm’s indebtedness is many times larger. Recently, the Eagle announced that it was discontinuing daily publication, and will be printed six times weekly beginning in November.
McClatchy Corporation stock is now under $3 a share despite having a reverse stock-split that dramatically reduced the number of shares (1 for 10) in this financially distressed firm. To raise cash, McClatchy recently sold their Kansas City Star building. The details of this transaction that included a 15-year leaseback, indicate a company suffering severe financial difficulties.
Despite these cash flow problems, the resources needed to write this story were provided. The Wichita broadcast news media is now following, and reporting this story too.
However, this type of reporting could have occurred years ago and wasn’t. Why not?
Vote for the Leftist With A Chance
The very liberal Wichita Eagle editorial page is nothing new. When Knight-Ridder owned the eagle, the paper did an in-your-face endorsement of the liberal Michael Dukakis in the 1988 presidential election to its readers in Republican-voting Kansas.
Now the Eagle knew that their endorsement would not matter. Kansas had not voted for a Democrat for president since 1964, or before that, 1936 when Kansas’ favorite son, Alf Landon, was defeated by FDR. Despite this, they endorsed a Massachusetts leftist who went on to lose in a national landslide, as well as a Kansas landslide in this state. Even if a Republican loses a national election, Kansans overwhelming voted for Bob Dole every time his name appeared on the national election ballot.
State and local newspaper endorsements are different. This is where the Eagle’s endorsements have had more influence in races where voters may not know as much about the candidates. This is more of a factor in primaries where even less is known about candidates and their positions, than in general elections.
Now the Eagle’s defenders will take exception to this claim about liberal endorsements. Eagle defenders will claim that the paper has endorsed some Republicans, and occasionally even a conservative. It is true, this has occasionally occurred but only under a narrow set of circumstances. These non-liberal endorsements only occur when it was clear that the conservative was likely to win, and usually would win big regardless of who or how the paper endorsed. The Eagle’s editorial endorsement policy is usually to endorse the most liberal candidate with a reasonable chance to win, and has been in place for more than 40 years I’ve lived in Wichita.
As the paper’s financial and news resources have weakened, the ability to endorse has diminished with their diminishing circulation but still has substantial influence in low-turnout elections that especially include primaries, and down-ballot races.
Voice for Liberty Records It
Former Wichita Mayor Carl Brewer with major campaign donor Dave Wells of Key Construction. Evidently, Wichita city code did not prohibit Brewer from voting to give millions in contracts and subsidy to Key.The Voice for Liberty website at wichitaliberty.org pictured former Mayor Carl Brewer, a liberal Democrat, holding a big fish while standing next to a prominent local businessman David Wells of Key Construction Company. Next to this picture Weeks included a Brewer letter on city hall letterhead praising Key Construction Company and identifying it as the special construction company with city hall connections.
Bob Weeks and Voice for Liberty did everything possible to call out this situation. Interest in the local news media, from the Wichita Eagle to the broadcasters can be described in one word: crickets. Nada, nothing, ain’t going to go there was the Wichita news media reaction. But there are more city hall purchase contract shenanigans, and it is more recent.
Wichita Eagle Skews
In July 2012 the city council voted to give a large, nine-figure construction contract to a Michigan company with their select Wichita partners to replace the Wichita Airport terminal. The Michigan company and their local partners, including Key Construction, weren’t the low bidders. The lowest bidder was a Wichita construction company.
The Michigan company partnered with Key Construction and won the city council vote on this contract. Then-city council member Jeff Longwell voted to give this large contract to the Michigan/Key construction group.
The day before the city council and Longwell voted the Michigan construction company’s top management and many of their spouses made maximum donations allowed by law to the Longwell for County Commission Campaign. The day after Longwell voted to give them this $100 million-plus contract more maximum legal level donations rolled into the Longwell campaign from the Michigan company’s management and their spouses.
This all became public record when these were reported on campaign finance reports about 10 days before the election. Naturally, my campaign responded to this outrageous misconduct. Interest from the news media in general, and the Wichita Eagle, which had endorsed the less conservative candidate in this race, Longwell, had no interest in reporting on these outrageous events on their front or editorial pages.
The Wichita Eagle advertisement. Click for larger.My county commission campaign tried to buy a newspaper ad in the Eagle and publicize this outrageous financial misconduct at city hall. The Wichita Eagle’s advertising staff did everything they could to assist my campaign in this ad purchase. However, the rest of the Eagle editorial, management, and news staff attempted to censor my text, and prevent my ad from running in the form it was being used in our other campaign efforts. Eventually, my campaign did run an ad, but without all of the language that we wanted to use, in exposing this financial misconduct on the city’s airport construction contract.
This story did get to some voters, but only because my county commission campaign successfully mailed this information into voters’ hands, although roughly 40 percent of the voters had already cast ballots before my campaign material could be distributed. I beat Councilman Longwell with over 56% of the vote in the August 2012 GOP county commission primary contest.
However, when Sam Williams tried to raise this issue in the 2015 mayor’s race, it was treated as ancient history and not reported. Sadly, this history of cronyism at city hall wasn’t reported prior to the primary, and I believe that this would have made Lyndy Wells advance to the general election ballot. Most recently, this is especially true in the way the city has handled the destruction of Lawrence Dumont Stadium, and the sale of approximately 4 acres for $1 an acre around the stadium for the ownership group of an out of state, minor league baseball club. Special city favors for special people within the public-private partnership paradigm is the way municipal government operates here.
More Wichita Eagle Skews
This wasn’t the only example of city hall financial transgressions and shenanigans. In 2013 the city was involved in the city-owned land sale for the west bank apartment project, the same sort of financial shenanigans occurred. The city went with their politically favored firm, and Jeff Longwell voted with the majority to go his business buddies, in another example of this “public-private partnership.”
Sadly, Mayor Longwell continues to defend the “public-private partnerships” model for city development in this latest example of how Wichita city hall operates. This did not receive Wichita Eagle coverage like the most recent example that occurred with 3 weeks away from advanced voting in the 2019 mayor’s race begins, and roughly 5 weeks before the November 5 election day.
For many Wichitans, “public-private partnerships” is just a politically correct phrase describing cronyism, for ethically conflicted projects, for the special favors for special people environment in Wichita’s city government. Profits are privatized while loses land in taxpayer’s laps. This is what happens without clearly specified bidding, and without procedures for selecting, and protecting the low, winning bidders who meet clear project specifications.
City Purchases and City Scandals
Government scandals aren’t limited to city hall. Purchasing scandals have occurred at all levels of government.
After I joined the Sedgwick County commission in 2009, I was informed about past purchasing scandals in Sedgwick County government. These had all occurred in the last century. This occurred as I began officially reviewing county financial operations. County staff was proud of the protections and safeguards built into the county’s bidding and bid board process.
That is why almost all county bids were handled as routine, often consent agenda items. That’s how the county had created its bid board, and how there was a major effort to protect taxpayers. This transparent process treated all potential bidders fairly, whether they were local, or not; whether they knew or didn’t know county officials; and it was an open, transparent process. The city needs to move to a clear, transparent, and fair model like the county has enjoyed for several decades.
Conclusion With a Warning for the Future
Financial shenanigans have a long history in Wichita city hall. Lack of detailed news coverage of these shenanigans is a hidden story that this non-reporter is going to try and disclose for if nothing else, the historical record now. This is sad that this history has to be provided by a frustrated, non-media, Wichitan who, while I did enjoy an elevated county courthouse observation position for eight years, could only observe these city crony cases from the other side of Central Ave.
Additional details about these crony stories mentioned here are contained in the Voice for Liberty archives. This information is accessible to everyone on this site. Even the news media.
Now, this most recent example of city cronyism has received a large amount of well-deserved, and in fact remarkable, huge coverage by the Wichita Eagle. While I am a major critic of the Eagle, I will state that this paper deserves credit for breaking this story.
This must be placed in the context and contrast with often the lack of interest in the past, especially if the Eagle’s politically favored officials were involved. The major news story is not the continuing cronyism at Wichita city hall but the fact that cronyism was exposed, received major negative news attention, and now continuing news coverage.
Sadly, I expect that the bottom line is that little or nothing to change the public-private cronyism model that is encased in political concrete in city hall. This model also seems to be encased in Wichita media concrete too. Sadly, this defective economic model enhancing cronyism is likely to prevail regardless of who wins in the mayor’s election contest, or the other city council elections, November 5.
Postscript
The cronyism in Wichita and news media flaws that are discussed above are relevant but tiny compared with the egregious corruption nationally in our country. The outrages from the Clinton Crime Foundation, the recent revelations concerning the Biden overseas money schemes, the misuse of government FISA surveillance in the Russian collusion hoax, outline national abuses and governmental scandals that far exceed local government’s defects in Wichita.
My sources for these national assertions include but are not limited to the financial revelations about misconduct by both Democrats and Republicans in Peter Schweizer’s outstanding books: Secret Empire,Clinton Cash, and Extortion, are excellent. News media flaws nationally are documented by the .
Are We Rome? by Lawrence Reed is a brief, pamphlet sized outline (see Foundation for Economic Education) of our national financial and governmental challenges. Those who want to explore our national fiscal and institutional problems, I would recommend Dinesh D’Souza’s and Mark Levin’s numerous books. If we don’t get this right, Mark Steyn’s After America: Get Ready for Armageddon moves from a yellow warning light to a hideous, Venezuelan reality.
Fighting the good fight within government will be tough. Scott Walker’s Unintimidated: A Governor’s Story and a Nation’s Challenge describes the Wisconsin battle in exquisite detail. It is a valuable, but cautionary reality defenders of liberty can find incisive examples of the challenges ahead. Levin’s proposed constitutional amendments in the Liberty Amendments is also valuable reading.
Sadly, there aren’t any books like this for Kansas, let alone Wichita. Greg Jarrett has left Wichita and gone national with his excellent books. This essay is a report for the legacy of those interested in local government in the early 21st century. This also provides a report for anyone interested in the governmental legacy left for our heirs who will follow us in south-central Kansas.
In an effort to avoid mistakes made in the past and inspire confidence in the process, parties wishing to receive economic development subsidies for projects in downtown Wichita are evaluated on a variety of measures. The evaluation matrix released for a project to be considered next week by the Wichita City Council, however, ought to be recalculated.
City documents describe one of two competing projects as this: “River Vista is proposed by River Vista LLC, a development group comprised of George Laham, Dave Burk, Dave Wells and Bill Warren.”
It’s this ownership team that ought to cause the city concern. Two of the evaluation criteria are “Past project experience with the City of Wichita” and “References, especially from other municipal partners.” This development team was awarded the maximum number of points possible for each (points being a positive measure). Here are a few things that the evaluation committee may not have considered when awarding these points.
Dave Wells: Wells is president of Key Construction. Last year the Wichita Eagle reported on “city-financed downtown parking garages that spiraled well over budget.” Noting the cost overruns, reporter Bill Wilson wrote: “The most recent, the 2008 WaterWalk Place garage built by Key Construction, an original partner in the WaterWalk project, came in $1.5 million over budget at almost $8.5 million. That’s the biggest parking garage miss, according to figures from the city’s office of urban development, although the 2004 Old Town Cinema garage built by Key Construction came in almost $1 million over budget at $5.225 million.” (Wichita city manager proposes eliminating no-bid construction projects.)
Despite these two cost overruns on city projects, Wichita Mayor Carl Brewer wrote in a letter recommending Key Construction on a different matter: “Key is known for their consistent quality construction, budget control and on schedule delivery.” Maybe that’s what the evaluation committee relied on.
Also, two years ago Key Construction proposed — and was awarded by the city council — a no-bid contract for a parking garage. But the city later put the contract to competitive bid. Key, which first bid $6 million, later bid $4.7 million. This no-bid contract awarded to Key was cronyism in the extreme. If the desire of the majority of the city council, including Mayor Carl Brewer, had been realized, Wichita taxpayers would have sent an extra — and unnecessary — $1.3 million to a politically-connected construction company. See Campaign contributions show need for reform in Wichita for an example of how Key Construction has mastered political cronyism.
Dave Burk, Dave Wells: These two were original partners in WaterWalk, which has received over $40 million in subsidy, with little to show for results.
Dave Burk: He’s received many millions from many levels of government, but still thinks he doesn’t get enough. This is what we can conclude by his appeal of property taxes in a TIF district. Those taxes, even though they are rerouted back to him for his benefit, were still too high for his taste, and he appealed. The Wichita Eagle reported in the article (Developer appealed taxes on city-owned property): “Downtown Wichita’s leading developer, David Burk, represented himself as an agent of the city — without the city’s knowledge or consent — to cut his taxes on publicly owned property he leases in the Old Town Cinema Plaza, according to court records and the city attorney.”
A number of Wichita city hall officials were not pleased with Burk’s act. According to the Eagle reporting, Burk was not authorized to do what he did: “Officials in the city legal department said that while Burk was within his rights to appeal taxes on another city-supported building in the Cinema Plaza, he did not have authorization to file an appeal on the city-owned parking/retail space he leases. … As for Burk signing documents as the city’s representative, ‘I do have a problem with it,’ said City Attorney Gary Rebenstorf, adding that he intends to investigate further.”
Council member Jeff Longwell was quoted by the Eagle: “‘We should take issue with that,’ he said. ‘If anyone is going to represent the city they obviously have to have, one, the city’s endorsement and … two, someone at the city should have been more aware of what was going on. And if they were, shame on them for not bringing this to the public’s attention.’”
Council member Lavonta Williams was not pleased, either, according to her quotations: “‘Right now, it doesn’t look good,’ she said. ‘Are we happy about it? Absolutely not.’”
In a separate article by the Eagle on this issue, we can learn of the reaction by two other city hall officials: “Vice Mayor Jim Skelton said that having city development partners who benefit from tax increment financing appeal for lower property taxes ‘seems like an oxymoron.’ City Manager Robert Layton said that anyone has the right to appeal their taxes, but he added that ‘no doubt that defeats the purpose of the TIF.’”
The manager’s quote is most directly damaging. In a tax increment financing (TIF) district, the city borrows money to pay for things that directly enrich the developers, in this case Burk and possibly his partners. Then their increased property taxes — taxes they have to pay anyway — are used to repay the borrowed funds. In essence, a TIF district allows developers to benefit exclusively from their property taxes. For everyone else, their property taxes go to fund the city, county, school district, state, fire district, etc. But not so for property in a TIF district.
This is what is most astonishing about Burk’s action: Having been placed in a rarefied position of receiving many millions in benefits, he still thinks his own taxes are too high. Now he wants more city taxpayer subsidy.
Bill Warren: In 2008 the Old Town Warren Theater was failing and its owners — Bill Warren being one — threatened to close it and leave the city with a huge loss on a TIF district formed for the theater’s benefit. Faced with this threat, the city made a no-interest and low-interest loan to the theater. Reported the Wichita Eagle: “Wichita taxpayers will give up as much as $1.2 million if the City Council approves a $6 million loan to bail out the troubled Old Town Warren Theatre this week. That’s because that $6 million, which would pay off the theater’s debt and make it the only fully digital movie theater in Kansas, would otherwise be invested and draw about 3 percent interest a year.”
With the history of these parties working in public-private partnerships, the Wichita City Council needs to question the matrix delivered by the evaluation committee.
As he has done previously, Wichita Mayor Carl Brewer decided not to vote on a matter involving Spirit Aerosystems at the November 5, 2013 meeting of the Wichita City Council.
Wichita mayor Carl Brewer with major campaign donor Dave Wells of Key Construction.
Tomorrow the 
So there were no “estimates” that Key Construction bested. But there was an objectionable no-bid contract that the council agreed to. Fortunately for Wichita, a few people objected and overrode the council’s bad decision.
Be advised: If you ask the mayor to adhere to this law, he may 
shall refrain from making decisions involving business associates, customers, clients, friends and competitors; shall refrain from repeated and continued violation of city council rules; shall refrain from appointing immediate family members, business associates, clients or employees to municipal boards and commissions; shall refrain from influencing the employment of municipal employees; shall refrain from requesting the fixing of traffic tickets and all other municipal code citations; shall refrain from seeking the employment of immediate family members in any municipal operation; shall refrain from using their influence as members of the governing body in attempts to secure contracts, zoning or other favorable municipal action for friends, customers, clients, immediate family members or business associates; and shall comply with all lawful actions, directives and orders of duly constituted municipal officials as such may be issued in the normal and lawful discharge of the duties of these municipal officials.
unusual interest in Michigan about the airport contract decision, and the campaign bank account of 
