Voice For Liberty

Search results for: “Bill Warren”

  • Concern over state office building decision politics

    Speculation that politics might influence a decision over the location of State of Kansas offices is amusing, given that one of the players has a history of awarding campaign contributors and friends. Will he now advocate for keeping politics out of governmental decision-making?

    When the State of Kansas said it is going to move offices from its downtown location, a local politician expressed concern to the Wichita Eagle:

    “It raises a red flag,” says Rep. Jim Ward (D-Wichita). “I have a concern there is a history of the governor rewarding financial contributors with state contracts. I know he has contributors in Wichita that own (buildings) that fall into that category. … I don’t want that to be the reason we’re moving.”

    In another Eagle article, Ward said his second priority is “to find out who owns the building where the departments may move ‘to make sure this isn’t going to help a political contributor.’”

    I welcome Rep. Ward’s concern regarding politicians rewarding financial contributors with government contracts. Of course, he might have taken a moment to find out who actually owned the building before making charges of political payback.

    It would be interesting to know if Wichita Mayor Carl Brewer shares Ward’s concern about political payback as he intervenes and tries to keep the state offices in their current location.

    Will Brewer argue that the state should keep politics out of this decision? If so, this will be the same Carl Brewer who operates in this fashion:

    Votes for no-bid overpriced contracts to political contributors: 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. Then Brewer was willing to spend an extra $1.3 million of taxpayer money to reward a politically-connected construction firm that makes heavy campaign contributions to him and many other council members.

    Sits in judgment of campaign contributors: 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.

    Recommends his cronies, even when they’ve harmed city finances: 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 the city’s experience with this company, 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.”

    warren-theater-brewers-best-bbq-sauce-small

    Entangles business welfare and personal business: 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. Then when Brewer started manufacturing and selling barbeque sauce, it was sold at Warren’s theater.

    Given this history, it’s difficult to imagine Brewer arguing that the office location decision should be made free from political considerations. His behavior — and that of some other council members as well — shows that making investments in Wichita politicians is highly lucrative.

    This decision is being made in Topeka at the state level, not at Wichita City Hall. It’s still amusing, however, to see Rep. Ward express concern over political campaign contributions influencing Wichita government.

  • Curious Wichita ethics enigmas

    Wichita City HallAs 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.

    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.

    Add to this confusing mix of ethical judgment calls: The mayor feels he can’t shop for his personal automobile in Wichita because he doesn’t want to be accused of getting a “special deal,” in his words.

    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 Theater Brewer's Best 2013-07-18

    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.

  • Warren Buffet’s secretary: marginal vs. average, Hauser’s Law

    Some of the confusion surrounding Warren Buffet’s secretary and her taxes comes from the failure to distinguish between average and marginal tax rates. There’s also the fact that Social Security and Medicare payroll taxes are paid on only the first $106,800 of income.

    But considering income taxes alone and not payroll taxes, there’s often confusion between average tax rates (the total amount of tax paid divided by the amount earned) and marginal tax rates (the amount of tax paid on the next dollar earned).

    As an illustration, consider a single person earning $60,000. Plugging the numbers into the tax calculator at efile.com, and not taking any deductions other than standard and personal, produces a tax liability of $8,444. On income of $60,000, this is an average tax rate of 14.07 percent.

    But consider if the person earns another $100. (The calculator doesn’t work with fractional dollars, so we’ll use $100 instead of $1.)

    Now, the tax liability is $8,469. That’s an increase of $25 in taxes for an increase of $100 in income. In other words, this person is in the 25 percent tax bracket, meaning that each additional dollar earned results in an additional $0.25 in tax.

    Not all earnings are taxed at this 25 percent rate. Some is taxed at a much lower rate, and some not at all. By the way, the average tax rate has now increased to 14.09 percent.

    If the $60,000 wage earner is married with two children, the tax bill falls to $3,463, producing an average tax rate of 5.77 percent, and the marginal rate on the next dollar earned is 15 percent. This again assumes no deductions beyond the standard and personal.

    So what tax rate does Warren Buffet’s secretary pay? There can be many answers.

    One thing we can be certain of, however, is that wealthy people like Buffet have options in structuring their income that ordinary wage earners don’t. Buffet, for example, says he receives most of his income in the form of capital gains or dividends, which are taxed at 15 percent.

    This is an illustration of Hauser’s Law at work. Try as we might, raising tax rates won’t generate higher revenues (as a percentage of gross domestic product), due to Hauser’s law. W. Kurt Hauser explains in The Wall Street Journal: “Even amoebas learn by trial and error, but some economists and politicians do not. The Obama administration’s budget projections claim that raising taxes on the top 2% of taxpayers, those individuals earning more than $200,000 and couples earning $250,000 or more, will increase revenues to the U.S. Treasury. The empirical evidence suggests otherwise. None of the personal income tax or capital gains tax increases enacted in the post-World War II period has raised the projected tax revenues. Over the past six decades, tax revenues as a percentage of GDP have averaged just under 19% regardless of the top marginal personal income tax rate. The top marginal rate has been as high as 92% (1952-53) and as low as 28% (1988-90). This observation was first reported in an op-ed I wrote for this newspaper in March 1993. A wit later dubbed this ‘Hauser’s Law.’”

    People react to changes in tax law. As tax rates rise, people seek to reduce their taxable income and make investments in unproductive tax shelters. There is less incentive to work and invest. These are some of the reasons why tax hikes usually don’t generate the promised revenue.

    Any plan to generate substantially more revenue by raising tax rates will have to overcome this tax-avoiding behavior. Hauser’s law says this is not likely to happen.

    Hauser's LawHauser’s Law illustrated. No matter what the top marginal tax rate, taxes collected remain an almost constant percentage of GDP.

  • Wichita Warren Theater groundbreaking raises policy issues

    Friday’s groundbreaking of a new Warren Theater and renovation of the existing theater in west Wichita provide an opportunity to revisit some of the public policy issues surrounding Wichita city government and its intervention in the economy in the name of economic development.

    Wichita Mayor Carl Brewer and Vice Mayor Jeff Longwell claim that the economic development incentives or subsidies offered to Warren do not cost Wichita taxpayers anything.

    Reading comments left to stories at various media outlets, there is definitely a problem with citizens understanding the nature of the city’s industrial revenue bond program. There is no money being lent by the city, as many citizens seem to believe. Instead, the benefit of the program is the escape from paying property taxes and possibly sales taxes. The fact that tax forgiveness is mixed in with a private loan or bond purchase is definitely a source of confusion. The city should seek to simplify this program, if it intends to continue this practice.

    But what about the claim that tax forgiveness does not cost other taxpayers? Will the new theater make use of city services such as fire and police protection? Will employees of the theater send their children to public schools? Vice mayor Longwell says that the city is not adding new police officers because of the new theater, so there is no additional cost for police protection. At the margin, that may be true — each additional house or building does not require a new policeman be hired. But at some time, additional city services and personnel will be required.

    The city’s practice of liberally granting tax abatements goes against the constant refrain that we must “build up the tax base.” The city’s position is that by “investing” in tax breaks, the city will gain more revenue in the future.

    The fallacy of the city’s investment philosophy can easily be seen. When the city grants tax abatements, there is a cost-benefit analysis that accompanies the proposal. The rationale of this analysis that by giving up tax revenue now, more will flow in at some future time.

    That’s the source of the fallacy. The return to the city and other governmental units is more tax revenue. Is it the purpose of the city to generate more and more tax revenue? Is it productive to grant one taxpayer favored status so that other hapless taxpayers can be soaked instead?

    When a business invests, it does so in order to increase its productive capacity so that it can earn higher future profits, those profits — or losses — being the measure of success of the investment. Government has no ability to calculate profit and loss, and therefore has no way to judge whether its investment has been wise and productive.

    There is also, of course, the concept that private business investment is voluntary, while the action the city takes is not voluntary. Citizens must comply.

    The companies that receive tax breaks are often prominent companies that ask for large tax abatements. It is worth considerable time and effort — and campaign contributions — for these companies to pursue these benefits. Small companies, however, often don’t fit into the various programs the city has. Instead, they face additional taxes to pay for the taxes the city doesn’t collect when it grants incentives and subsidies.

    Recently Alan Cobb wrote of the harm that targeted incentives cause, using Detroit as an example: “While state and local government poured incentives into the Big Three’s trough, the marginal costs of doing business for everyone else crept up.” See Wichita targeted economic development should end.

    An aspect of the incentive or subsidy package granted in this case is a fixed, negotiated, growth in property taxes the renovated theater will pay. There are a few points that deserve discussion. First, the base taxable value for the theater is the present value. The theater owner, however, is spending several million dollars on a renovation of that theater. This, according to the Sedgwick County Appraisers Office, would increase the taxable value of the theater by a large amount.

    But based on the deal struck with the City of Wichita, this increase in value will not figure into the base taxable value and therefore, will not affect the taxes (PILOT, actually) the theater owner will pay.

    Further, the rate of growth in value, 2.3 percent per year, is lower than what might be expected for commercial property to increase in value in many years. This fixed, predictable rate of growth is reminiscent of last year’s Proposition K proposal. The Wichita Eagle rejected this proposal, editorializing: “Over time, this system could result in significant disparities and a disconnect from actual market values, thus likely violating the Kansas Constitution’s requirement of a ‘uniform and equal basis of valuation.’”

    But in this case one politically-favored business was able to receive this benefit. These special deals breed justifiable cynicism and distrust of not only City Hall politicians and bureaucrats but businesses that seek this form of pork-barrel spending through the tax system.

    Finally, the payments the existing theater will make are not taxes, but payment in lieu of taxes, or PILOT. These payments are different in character from regular property taxes. Instead of falling under the Kansas property tax law regarding payment and possible sale of the property to pay taxes if the taxpayer falls behind for long enough, PILOTS are more in the form of a contract between the city and the taxpayer. If the taxpayer were to fail to pay, the city would have to sue for breach of contract. If the city should prevail in such a suit, it would stand in line with other creditors instead of taking a preferred position as in a tax sale.

    This is, of course, assuming the city would choose to pursue such a lawsuit. Nothing would require it to do so. As the city has in the past bailed out this theater owner with a no-interest and low-interest loan, we could easily imagine the city deciding to let these missing or late PILOT payments slide by.

    This too assumes that failure to pay PILOT payments as agreed would become public knowledge. The Sedgwick County Treasurer’s office prints lists of delinquent property taxpayers. There is no corresponding list of delinquent PILOT payments.

  • Wichita and the Old Town Warren Theater Loan

    Remarks to be delivered to the Wichita City Council, July 1, 2008.

    Mr. Mayor and members of the Council, we are potentially beginning a journey down a road where there are two classes of businesses in Wichita.

    There are business owners who seek to earn their profit through market entrepreneurship, that is, by meeting the demands of their customers and the marketplace. That’s a difficult thing to do. An entrepreneur must sense customer demand and desires, and then commit resources to satisfying customers. If entrepreneurs are correct in their judgments and successful in their execution, they earn profits.

    There are other business owners who, through TIF districts, tax abatements, and outright subsidy as in the case of the proposed loan agreement before you today, earn their profits by pleasing politicians such as the members of this council. They practice political entrepreneurship. The people they must please are a majority of this council. Investments — to the extent that government spending can be called that — will be made based on political, rather than marketplace, considerations.

    We have a proud history of market entrepreneurs in Wichita; men whose names are known not only in Wichita, but across the world. There are many other men and women in Wichita who, although their names are not famous, successfully meet customers’ demands in the marketplace and have built successful businesses.

    Mr. Warren is, by all accounts, a talented entrepreneur who earns profits by pleasing customers at his theaters located on Wichita’s west and east sides and in other cities.

    The fact that this theater — operated by a person with great experience in running successful theaters — is not profitable tells us all we need to know about the wisdom of investment in this business. If Mr. Warren and his partners wish to run it as a hobby, let them do so with their own money. The citizens of Wichita, however, need to be able to make their own investments in ways that they believe will earn a profit — that profitability being the one sure test of the success of an investment. When government makes “investments” based on political calculation, the people of Wichita are less able to make their own private investments.

    The council made an unwise decision some years ago when it established the TIF district for this theater. While the city is bound to pay to retire the bonds that were issued, that is the only obligation we have. The fact that a bad decision was made in the past should have no bearing on the decision to be made today. This is especially true as a decision to make this loan steers Wichita firmly towards the path of less private entrepreneurship and more government control of investment in Wichita.

  • Warren Old Town Wichita Theater: Good Money After Bad?

    This letter is from my friend Darrell Leffew. Not everyone seems to understand the folly of throwing good money after bad. “Taxpayers are already on the hook” is Wichita city council member Jeff Longwell’s opinion as expressed in a Wichita Eagle article. Mr. Longwell, I realize you weren’t a member of the council when we taxpayers were placed on the hook, but don’t help us on another, please.

    Let us not throw more good money after bad. The Wichita City Council has approved a business loan to the Limited Liability Company that owns the Old Town Warren Theater.

    That same company was quoted in an Eagle article earlier this month as saying the remodel paid for by the loan would cut the losses. No mention of ending the losses, just reducing. What are the exact estimates? Taxpayers should be fully informed.

    An Eagle article of November 2004 talked about revenues related to the TIF, which funded Old Town development, being woefully short. How many millions of taxpayer dollars are already at risk? And if the business goes into foreclosure before the loan is repaid, we the taxpayers have first claim on a failed, debt ridden property.  Our interim City Manager advised against the loan.

    Our elected officials are not just offering commercial banking now but BAD commercial banking. And the “Open for Business” sign is bright neon.

    Has our City Council overstepped its authority? Voters will decide at the polls.

  • The advantage of being Warren Buffet

    The recent news that Warren Buffet is giving away the bulk of his fortune to charity is good news to me, as I greatly prefer private charity to government spending of taxes. That’s true for me even if Mr. Buffet were to use his philanthropy to support causes that I might not agree with.

    But there is an irony here. Mr. Buffet is a vocal supporter of the inheritance tax (or estate tax or death tax). By giving away much of his wealth, he escapes paying the tax he wants others to pay. Mr. Buffet is wealthy enough that he can give away a lot, but he stills retain great wealth for supporting himself in his declining years and providing very well for his children.

    Most people who have enough wealth to be subject to inheritance taxes don’t have enough wealth to do what Mr. Buffet has done. Instead, they must be content with the government spending much of their estate after they die.

    If Mr. Buffet really thinks inheritance taxes are good, he should keep his wealth and let the government tax it when he dies, just like most others have to do. Alternatively, if he wishes to enjoy seeing how his wealth is spent while he is still living, he could pre-pay his inheritance tax and watch our government at work.

  • Questions for the next Wichita city attorney: Number 1

    Questions for the next Wichita city attorney: Number 1

    Wichita City Hall SignWichita’s city attorney is retiring soon, and the city will select a replacement. There are a few questions that we ought to ask of candidates, such as the following.

    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.”

    Wichita city attorney candidate, here’s a question: If a member of the Wichita city council had a business relationship with a person, and then that person was involved in a matter that the city council was called to vote on, how would you advise the council member?

    It’s not a hypothetical question. Last year the Wichita city council had to make a decision regarding two development teams that had applied to build a project. (See Wichita contracts, their meaning (or not) for video.) It included various forms of subsidy. Here are some facts that no one disputes:

    Warren Theater Brewer's Best 2013-07-18

    1. Wichita Mayor Carl Brewer is a member of the Wichita City Council and was in position to make a decision.

    2. Bill Warren was one of the parties applying for the project.

    3. Bill Warren also owns movie theaters.

    4. Wichita Mayor Carl Brewer owns a company that manufactures barbeque sauce.

    5. Brewer’s sauce was sold at Warren’s theaters.

    It seems straightforward, doesn’t it? The mayor should not have participated in a decision involving his business partner. That seems to be the clear meaning of the city code. But the mayor proceeded to participate in the discussion and vote.

    Now, I don’t know what happened behind the scenes. Did the mayor ask the city attorney for his opinion on whether he should abstain from voting? If so, what did the city attorney say? Did the mayor follow or disregard the advice?

    Wichitans ought to be interested in the tenor of the advice the next city attorney will provide to council members and the city’s staff of bureaucrats. Will the next city attorney ignore the plain meaning of laws in order to provide legal cover for the council and staff? Or, will the attorney provide advice that respects citizens and the rule of law?

    We probably won’t ever know.

    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.

  • From Michigan to Wichita’s Jeff Longwell: The campaign contributions

    Two weeks ago 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 this week: 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 — the day before the Wichita City Council heard the appeal that resulted in Key Construction apparently 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.

    This is not the first time Jeff Longwell has placed the interests of his campaign contributors ahead of taxpayers. Last August the council, with Longwell’s vote, 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. Later the city decided to place the contract for competitive bid. Key Construction won the bidding, but for a price $1.3 million less.

    What citizens need to know is that the Wichita City Council, including Longwell, was willing to spend an extra $1.3 million of taxpayer funds to reward a politically-connected construction firm that makes heavy campaign contributions to Longwell and other council members. Only one council member voted against this no-bid contract.

    Later that year when citizens exercised their constitutional right to challenge a taxpayer-funded giveaway to the special interests that fund his campaigns, Jeff Longwell said it was “disappointing,” and a “stunt.” He said that using this fundamental aspect of democracy causes citizens to “lose credibility.” (Wichita Eagle, September 14, 2011)

    After Wichita voters rejected this special tax deal, the Wall Street Journal in a column titled “A Wichita Shocker: You can beat city hall” wrote: “Local politicians like to get in bed with local business, and taxpayers are usually the losers. So three cheers for a voter revolt in Wichita, Kansas last week that shows such sweetheart deals can be defeated.” (Review & Outlook, March 6, 2012)

    It’s no wonder Longwell was disappointed when citizens petitioned their government. Voters soundly rejected the political cronyism and sweetheart deals that are Longwell’s legacy.

    It’s all part of Longwell’s disregard for citizens in favor of his campaign contributors. In 2008 the city council, with Longwell approving, made a $6 million no-interest and low-interest loan to movie theater owner Bill Warren. The contracts were not made available until just hours before the meeting where the loan was voted on. When a reporter asked about journalist and citizen access to these documents in a timely fashion, the reporter wrote “It’s unlikely many residents would read the full contract even if it had been made public earlier, Longwell said.” (Little time to review Warren loan terms, July 1, 2008 Wichita Eagle)

    Companies Bill Warren controls contributed at least $7,500 to Longwell’s current campaign.

    In 2011, when discussing signage policy at merchants that charge an extra community improvement district sales tax, Longwell said that including the specific add-on tax rate would be confusing to shoppers, because different CIDs may charge different add-on rates. Again, disregard for citizens.

    Jeff Longwell defends these giveaways by saying they create jobs. But Wichita economic development is failing. Our city is not doing well. We won’t create prosperity and jobs by over-spending on no-bid city contracts that provide out-size profits for Longwell’s political sponsors.

    Additionally, 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?

    Wichita and Kansas need pay-to-play laws to reign in the practices of Jeff Longwell, Carl Brewer, and other city council members. For the good of our city and state, we must end the “pay-to-play” system of votes for political campaign contributions.

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