News of a Sedgwick County Commissioner’s trip to Africa has raised some controversy, and something like this has been tried before.
The Wichita Eagle reported this regarding Sedgwick County Commissioner Lacy Cruse’s visit to the West Africa country Ghana: “She said she focused her efforts on economic opportunities related to aviation and education. She said she talked to Ghana’s minister of aviation about potentially establishing an aviation school and setting up an aviation maintenance shop at the Tamale International Airport in Ghana. She didn’t make any formal deals on behalf of the county or any local companies. She said forming a trade relationship with Ghana isn’t something that can happen overnight.” 1
Something like this has been tried before, and not too long ago. In 2011, Wichita Mayor Carl Brewer and a delegation traveled to Ghana on a trade mission, seeking business opportunities for Wichita companies. The aircraft industry was prominently mentioned.
The host country, however, may have misunderstood the mission of the visitors from Wichita. A news release on the Official Portal of the Government of Ghana published after the visit included this: “[District Chief Executive (DCE) of Lower Manya Krobo District, Mr Isaac Abgo Tetteh] announced that the Mayor has pledged to furnish Nene Sakitey II with an Aircraft for his private use.” 2
I had thought that perhaps this promise of an airplane to the overlord was a case of something being lost or mangled in translation, but then I realized that English is the official language of Ghana.
There was a follow-up visit in 2014. The Wichita Eagle reported the goals of then-Mayor Brewer: “Brewer’s particular interest on the trip is building business relationships overseas that could lead to opportunities for small and midsize aviation businesses in Wichita.” 3
The trips weren’t very successful in stimulating aviation exports. With the exception of 2011, the Census Bureau reports little in the way of aviation-related exports to Ghana. The data includes the entire State of Kansas.
Government of Ghana Official Portal. Wichita City to Partner Manya Krobo For Development. November 25, 2011. “An unprecedented visit by the Mayor of Wichita City, Kansas State USA, Mr Carl Brewer, his Deputy, Mrs Lavonta Williams and the Council of Elders were welcomed by the overlord of Manya Krobo Traditional Area, Nene Sakitey II at the Palace. At a grand durbar organised in honour of the Mayor and his delegation, the District Chief Executive (DCE) of Lower Manya Krobo District, Mr Isaac Abgo Tetteh, urged the people of Manya Krobo to set an initiative in order to get a push from the Mayor for the realisation of the sister city project by the city of Wichita and the Manya Krobo municipality. Mr Tetteh also announced at the gathering that, the sister city concept is to assist Lower Manya to attain the standard of a city by helping in the direction of education and other infrastructural development. He announced that the Mayor has pledged to furnish Nene Sakitey II with an Aircraft for his private use.” Image available here. ↩
Wichita Mayor Jeff Longwell says there is no corruption involving him, but this is only because of loose and sloppy Kansas and Wichita laws.
In an advertisement in the November 3, 2019 Wichita Eagle,Wichita Mayor Jeff Longwell defended himself against charges of corruption. Referring to a recent investigation by the Sedgwick County District Attorney, the ad states:
In 2018 and 2017, Bennett found I was 100% compliant. In 2016 he found only one instance where I was $21.33 over the annual $500 threshold allowed for “goods and services” received from local companies.
Here’s what the District Attorney found in his investigation:
Given the failure of Kansas Statutes Annotated 75-4301a to define “good or services,” the Mayor explained to an investigator with the Office of the District Attorney that he did not believe a round of golf constituted “goods or services.” He further explained that charitable golf outings where the entire expenditure went to charity (situations where the golf course donated their greens fees to the charity) led him to the conclusion that, because the charity received the entire donation, the golfers (including him) derived no financial benefit. As such, he did not believe it necessary to report these outings on his substantial interest form. 1
This reasoning by Longwell is hairsplitting to the extreme. What’s important is that Longwell accepted gifts from people he later steered a large city contract to. However large or small the gifts, this is wrong.
In his conclusion, the District Attorney wrote:
And while I am confident, having exhaustively researched the issue, that, as an act of entertainment, golf qualifies as “goods or services” under Kansas law, it is also true that Kansas Statutes Annotated 75-4301a, et seq., governing Substantial Interest Form filings, offers little guidance. I am not filing a class B misdemeanor under these facts.
It seems that sloppy Kansas laws are the problem, along with a mayor willing to exploit that weakness.
Does the city have any laws or regulations on this matter? Here’s an excerpt 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.”
We also have statutory language that reads “business associates, customers, clients, friends and competitors.” But the city attorney, in a question involving former mayor Carl Brewer, felt that these terms are not defined, and therefore the mayor and city council members need not be concerned about compliance with this law. 2
Today, city hall ethics, at least in the mayor’s chair, have not improved. It’s reasonable to conclude that people who pay the mayor to play in expensive golf tournaments are his friends. People who pay for dinner for the mayor and his wife and describe it as a social gathering (as the district attorney found) are friends. Or, maybe they just want something from the mayor and see an ersatz social relationship as a means to an end. But as we’ve learned recently, the current city attorney says council members “are left to police themselves on that city law,” according to Wichita Eagle reporting. 3
Is it true, as the mayor’s ad screams in capital letters?
THERE IS NO CORRUPTION LIKE YOU’VE BEEN LED TO BELIEVE
There is none, but only because of sloppy Kansas and Wichita laws. But under any commonsense definition, yes, there is corruption. It is not necessary for an act to be illegal to be corrupt; that it is dishonest or fraudulent conduct is enough.
Should Longwell be re-elected, can we expect reform? I don’t think it’s likely that someone will support laws criminalizing their own past behavior.
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.
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.
Wichita has a city code governing ethical conduct by council members, but it seems to have no teeth.
Here’s an excerpt 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.”
When asked about a specific application of this city law relating to former Wichita Mayor Carl Brewer, 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.
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.So we have statutory language that reads “shall refrain,” but Gary Rebenstorf, the city attorney at that time, interpreted that to mean “advises.”
We also have statutory language that reads “business associates, customers, clients, friends and competitors.” But the city attorney felt that these terms are not defined, and therefore the mayor and city council members need not be concerned about compliance with this law.
I wonder whose interests the city attorney represents. The people of Wichita, who want to be governed in a fair and ethical manner? It doesn’t seem so.
I wasn’t satisfied with the city attorney’s response, so I and others engaged attorneys to research the law and see if it could be clarified and enforced. We received an opinion that we, as citizens of Wichita, likely did not have standing to bring a lawsuit against either the city or the mayor. We were told that the law would probably find that we suffered no harm. A city council member might have standing, however, because if an ineligible council member voted, that would unlawfully dilute the value of other members’ votes. We attempted to recruit council members to file a suit, but couldn’t find one who was interested.
I thought that was sad. Today, city hall ethics, at least in the mayor’s chair, have not improved. As we’ve learned this week, the current city attorney says council members “are left to police themselves on that city law,” according to Wichita Eagle reporting. 1
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.
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.
A Wichita firm plans to move its offices to what was billed as the city’s premier entertainment district.
King of Freight, a Wichita freight brokerage firm, is planning to move its operations to the vacant Gander Mountain building in WaterWalk. This requires a modification to the lease of the land.
It’s important to recognize that King of Freight is not the tenant in the lease. The landlord is the City of Wichita. The tenant is WaterWalk LLC, a Kansas limited liability company, whose president is Jack P. DeBoer. The lease covers only the land, not the building. The city does not own the building. While the city rents the land to DeBoer, there is undoubtedly a deal between him and King of Freight. Details of that are unknown.
When WaterWalk was conceived, the goal was a destination of retail, entertainment, and residences, and some $41 million of tax money was spent. The original lease for the Gander Mountain ground reflected that. Now, that a non-retail firm will be using the ground, a change was needed.
The reason is that the original lease included a provision for “additional annual rent.” If the business — Gander Mountain — exceeded certain financial parameters, the city could collect additional rent. The additional rent clause was never triggered. Other WaterWalk deals with similar provisions have never paid additional rent, either. 1)
The new lease abolishes the additional rent provision, although it could be reinstated if employment goals are not met. Since the additional rent clause is toothless, so there is no real penalty.
The tenant will continue to pay the city $1 per year in rent. King of Freight will pay $15 per month to use city parking spaces. This is perhaps half the market rate for long-term parking arrangements.
Is the move of King of Freight a good deal for the city and its citizens? King of Freight anticipates adding jobs in the future, and the new lease with the city requires certain job goals to be met. But immediately, the effect is simply moving employees from one downtown office to another. When King of Freight occupies new space, empty space will be left behind.
While putting the Gander Mountain building to use is good, its use as office space moves away from the original concept for WaterWalk, once touted as “Wichita’s Next Great Gathering Place.” 2
Will retail and entertainment establishments wish to locate near an office building? They didn’t want to locate in WaterWalk anyway, so maybe there is no change.
Of interest is DeBoer’s confession of being “confounded” by WaterWalk, recently telling the Wichita Eagle, “It’s a business I don’t know anything about.” 3
Before that, he told the Eagle that whatever becomes of the Gander Mountain building, it will be “something fun and good for the city.” 4
I don’t think that goal has been realized.
Of note: DeBoer told the Eagle he’s had opportunities to “do a restaurant or something,” but he declined. Former Wichita Mayor Carl Brewer, in State of the City addresses, promised specific named restaurants would be opening in WaterWalk. 5
In more detail
Excerpts from the city’s agenda packet for this item:
“The lease’s current rent requirement, which was drafted for a retail use, would be suspended if the job requirement is met, and would terminate in 10 years if KOF and its entities maintains the presence of 400 net new jobs in Wichita through the 10-year period.”
“KOF has also agreed to pay for parking spaces at an initial rate of $15/month per space. Revenue from KOF’s employee parking is estimated at approximately $70,000/year.”
From the lease agreement: “Section 5.01. Minimum Rent. As of the date first written above, Tenant has paid Landlord a minimum fixed annual rent (“Minimum Rent”) of One Dollar ($1) in one (1) installment covering the Term of this Lease as defined in Article I above.”
“Section 5.02. Additional Rent. The Tenant will also pay, without notice, and without abatement, deduction, or setoff, except as otherwise specifically allowed herein, as additional rent, all sums, taxes, assessments, costs, expenses, and other payments which the Tenant in any of the provisions of this Lease assumes or agrees to pay, and, in the event of any nonpayment thereof, the Landlord shall have (in addition to all other rights and remedies) all the rights and remedies provided herein or by law in the case of nonpayment of rent.”
This section then describes the mechanism of calculating “Additional Annual Rent.” This mechanism was crafted for a retail store so that if “Adjusted Net Cash Flow” was ever positive, the city would be paid 25 percent of that. But the activity of the retail store, Gander Mountain, never triggered the payment of additional rent. 6
The section goes on to modify the additional rent provision for uses other than retail, like an office: “No Additional Retail Rent and no Additional Rent involving any payment of any portion of the Adjusted Net Cash Flow shall be owed for any use of the Premises that is not a Retail Use under codes 4400 through 454390 of the 2017 NAICS.”
The property will be paying property taxes: “Section 6.01. Taxes. Tenant shall pay as additional rent during the Term and any extensions thereof, all ad valorem taxes, and all other governmental taxes or charges that may be levied against the Premises.”
Since the property is within a tax increment financing (TIF) district, the taxes flow to that, not to fund the general operations of government.
“Section 9.03. Parking. The parties agree that Tenant’s employees will have nonexclusive access to the 430-space Parking Garage and the 60 spaces of surface parking under U.S. 400 (“Kellogg”) for an initial rate of $15/month per employee for parking between the hours of 8:00 a.m. – 6:00 p.m., Mondays-Fridays. Tenant shall be responsible for providing a monthly report of the number of employees who are parking in Parking Garage and on surface parking lot under Kellogg, and shall remit $15.00 per employee on a monthly basis. At each one-year anniversary of this agreement, the parking rate shall increase 3%.”
“Section 16.06. Assignment; Sublease. Tenant may freely assign or sublease all or any portion of the Premises without Landlord’s consent.”
In his 2008 address, Brewer promised specific development at the struggling Waterfront development, which is heavily subsidized. Beaming with pride, Brewer said to the audience: “And, great strides are being made at Wichita Waterwalk. The topping out ceremony for Waterwalk Place is scheduled for this Thursday and I invite everyone to this event. I am pleased to announce two more national tenants that will be a part of the WaterWalk restaurant and entertainment development. … I am pleased to announce two more national tenants that will be a part of the WaterWalk restaurant and entertainment development. Joining Saddle Ranch Chop House will be Funny Bone Comedy Club and Wet Willies restaurant and daiquiri bar. These are just a couple of the fun and exciting tenants that will help make WaterWalk — Wichita’s Next Great Gathering Place.” This address was delivered a year before DoBoer took full control over WaterWalk, although he was involved before that. ↩
Email with Wichita City Manager Layton, May 10, 2019. ↩
As Wichita prepares to award a large construction contract, let’s hope the city acts in an ethical manner this time.
As the Wichita City Council prepares to make a decision regarding a contract for the new baseball stadium, the council’s past reputation in these matters can’t be overlooked.
The controversy over the stadium contract has been covered by the Wichita Eagle: “The Wichita City Council hasn’t officially approved a design-build team for the city’s new $75 million Minor League ballpark, but there’s already been a protest over the recommended group. … At issue in a protest by a competing team is whether the JE Dunn team meets a key requirement to be selected, which is that it has built at least three similar Major or Minor League ballparks.” 1
The biggest potential for unethical behavior comes from Wichita Mayor Jeff Longwell. In 2012, as the Wichita city council was considering the award of the contract for the new airport terminal, Longwell (then a council member) received campaign contributions from executives of Walbridge, a Michigan construction company partnering with Key Construction to build the new Wichita airport terminal. 2
Two Walbridge contributions were made on July 16, 2012, the day before the council, Longwell included, voted to award the contract to the Key/Walbridge partnership. More contributions from Walbridge arrived on July 20, according to Longwell’s campaign finance reports.
When questioned about the Michigan contributions, Longwell told the Wichita Eagle, “We often get contributions from a wide variety of sources, including out-of-town people.” But analysis of past campaign finance documents filed by Longwell showed just three out-of-state contributions totaling $1,500. 3
In deciding the airport contract issue, the council was asked to make decisions involving whether discretion was abused or whether laws were improperly applied. It’s not surprising that Jeff Longwell made these decisions in favor of his campaign contributors. But he shouldn’t have been involved in the decision.
That was not the first time Jeff Longwell has placed the interests of his campaign contributors ahead of taxpayers. In 2011 the city 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.
It’s not only Longwell with problematic behavior in the past. In 2012, before the vote on the airport contract, executives of Key Construction and spouses contributed heavily to the campaigns of both Wichita City Council Member Lavonta Williams (district 1, northeast Wichita) and Wichita City Council Member James Clendenin (district 3, southeast and south Wichita). These contributions were not known to the public until months after the vote was cast.
Williams is no longer on the council, but Clendenin remains.
The city needs an adult in the room. That person is, or should be, Wichita city manager Robert Layton. In the past he has implemented policies to end the practice of no-bid contracts. We don’t know what will happen this week.
“A campaign finance report filed by Wichita City Council Member Jeff Longwell contains contributions from executives associated with Walbridge, a Michigan construction company partnering with Key Construction to build the new Wichita airport terminal. … These contributions are of interest because on July 17, 2012, the Wichita City Council, sitting in a quasi-judicial capacity, made a decision in favor of Key and Walbridge that will cost some group of taxpayers or airport customers an extra $2.1 million. Five council members, including Longwell, voted in favor of this decision. Two members were opposed.” Weeks, Bob. Michigan company involved in disputed Wichita airport contract contributes to Jeff Longwell. Available at https://wichitaliberty.org/wichita-government/michigan-company-involved-in-disputed-wichita-airport-contract-contributes-to-jeff-longwell/. ↩
“Analysis of Longwell’s July 30, 2012 campaign finance report shows that the only contributions received from addresses outside Kansas are the Walbridge contributions from Michigan, which contradicts Longwell’s claim. Additionally, analysis of ten recent campaign finance reports filed by Longwell going back to 2007 found three contributions totaling $1,500 from California addresses.” Weeks, Bob. Jeff Longwell out-of-town campaign contributions. Available at https://wichitaliberty.org/wichita-government/jeff-longwell-out-of-town-campaign-contributions/. ↩
Currently there is discussion in Wichita on whether higher education is valued by residents. Following, from April 2011, a look at the educational achievement of the Wichita City Council. The members of the council cited below were Lavonta Williams, Sue Schlapp, Jim Skelton, Paul Gray, Jeff Longwell, and Janet Miller. Carl Brewer was mayor.
Before Jim Skelton left the council in January, none of the four men serving on the Wichita City Council had completed a college degree. The three women serving on the council set a better example, with all three holding college degrees.
Of the candidates running in next week’s election for four council seats and the office of mayor, less than half hold college degrees.
Is it necessary to complete college in order to serve in an office like mayor or city council? Apparently, none of the four men who held these offices without a degree thought so. The two running to retain their present positions — Mayor Carl Brewer and council member Jeff Longwell (district 5, west and northwest Wichita) — evidently don’t think so, or they would not be running again.
But we tell young people that college holds the key to success. We encourage schoolchildren to consider college and to take a rigorous high school curriculum in order to prepare for it. We encourage families to save for college. Our region’s economic development agency promotes the number of people with college or advanced degrees. We promote our colleges and universities as a factor that distinguishes Wichita. We hope that our elected officials will set an example we want young people to follow.
Once in office, we ask our city elected officials to attempt to grasp and understand complex sets of financial data, working with a budget of about half a billion dollars for the City of Wichita. We hope that they will be able to consider large and weighty issues such as the role of government in a free society. Members of the professional management staff — bureaucrats — that manage the city, county, and state are generally required to hold college degrees.
The irony is that elected officials often are highly reliant on the bureaucratic staff for information, data, and advice, and this professional bureaucracy is often highly educated. Does this imbalance create problems?
Elected officials compared to regular people
Amazingly, it turns out that elected officials, as a group, are less knowledgeable about civics than the general population. That’s the finding of Intercollegiate Studies Institute, which surveyed Americans and their knowledge of civics in 2008. After analyzing the data, ISI concluded: “Simply put, the more you know about American government, history, and economics the less likely you are to pursue and win elective office.”
A lawsuit claims that when the City of Wichita refinanced its special assessment bonds, it should have passed on the savings to the affected taxpayers, and it did not do that.
A lawsuit filed in Sedgwick County District Court charges that the City of Wichita improperly handled the savings realized when it refinanced special assessment bonds at a lower interest rate. The case is 2018-CV-001567-CF, filed on July 13, 2018, and available here.
The suit names David L. Snodgrass and Leslie J. Snodgrass as plaintiffs, and a long list of defendants, namely:
The City of Wichita, Kansas
Wichita City Manager Robert Layton
Wichita Finance Director Shawn Henning and Former Wichita Finance Director Kelly Carpenter
Wichita City Clerk Karen Sublett
Wichita Mayor Jeff Longwell and former Wichita Mayor Carl Brewer
Current Wichita City Councilmembers Brandon Johnson, Pete Meitzner, James Clendenin, Jeff Blubaugh, Bryan Frye, and Cindy Claycomb
Former Wichita City Councilmembers Lavonta Williams, Janet Miller, Sue Schlapp, Paul Gray, Jeff Longwell, Jim Skelton, and Michael O’Donnell
Springsted Incorporated
Gilmore And Bell, A Professional Corporation
Kutak Rock, LLP
Sedgwick County Treasurer Linda Kizzire
The suit asks for a class to be created consisting of “all other affected land owners paying excess special assessments,” which would, undoubtedly, be many thousands of land owners. No specific amount of relief is requested.
The suit’s basis
The city borrows money by issuing bonds to fund improvements to (generally) new neighborhoods. These bonds pay for things like residential streets, water pipes, and sewer lines. The debt service for these bonds, that is, the money needed to make the bond payments, is charged to benefitting property owners in the form of special assessment taxes, often called “specials.” These specials are separate from the general property taxes that are charged to all property.
General property taxes are based on a property’s assessed value multiplied by a mill levy rate. Specials, however, are based on the cost of the infrastructure and the payments needed to retire the debt. This amount is determined at the time bonds are sold and the repayment schedule is established. (Bond payments depend on the amount borrowed, the length of the repayment period, and the interest rate. All this is known at the time the bonds are issued.)
These specials usually last 15 years, and after paid, no longer appear on a property’s tax bill. Sometimes special assessments are prepaid.
What the city did, and didn’t do, according to plaintiffs
During the last decade, interest rates on long-term bonds generally fell. In response, the city issued refunding bonds. These bonds took advantage of low interest rates by paying off old bonds that had higher interest rates, replacing them with bonds with lower interest rates. The lawsuit alleges that since 2009, the city has issued $216 million in refunding bonds saving $60.2 million, according to city documents cited in the lawsuit. The suit does not specify how much of this savings is attributed to special assessment bonds.
So the city refinanced special assessment debt at a lower rate, reducing the cost of the debt. That’s good. Homeowners often do this when mortgage rates are low, and it’s good that the city does this too.
The problem, according to the lawsuit, is that some of the refinanced debt was special assessment debt. The lawsuit contends that, based on Kansas law, the city should have passed on the savings to the property owners that were paying off this special assessment debt. Instead, says the suit, “the City of Wichita transferred the excess special assessment money paid by affected Wichita taxpayers to support its general fund and/or other municipal funds.” In other words, the city spent the savings on other things, when it should have directed the savings to land owners who were paying the special taxes.
Plaintiffs allege that the conduct of the city and its advisors constitutes fraud against those paying special assessment taxes:
The fraudulent actions of Defendant City of Wichita, along with the other Wichita Defendants, and Defendants Springsted, Gilmore and Bell and Kutak Rock resulted in the misappropriation of millions of dollars of “saved” tax payments that should have been returned to Plaintiffs along with all other affected land owners paying special assessments levied under the General Improvement and Assessment Laws of the State of Kansas.
Further, the suit alleges that the liability faced by many of the defendants is personal:
Because the Wichita Defendants actively participated in the fraud practiced by Defendant City of Wichita, they cannot escape personal liability for the fraudulent actions of the City of Wichita upon Plaintiffs and all other affected land owners paying special assessments.
While there is one named party as plaintiff, the suit alleges that all similarly situated persons have been harmed, and so a class action is appropriate. That would be all property owners who have paid special assessment taxes to Wichita since 2009, including myself.
A City of Wichita town hall meeting ends in less than nine minutes, with a question pending and unanswered.
As part of its engagement with citizens, the City of Wichita holds social media town hall meetings. On June 20, 2107, there was a Facebook town hall on the topic of economic development featuring Assistant City Manager Scot Rigby. His charge is “developing and implementing a coordinated and comprehensive development services program and for developing, implementing and overseeing economic development, redevelopment and real estate programs and projects.” He’s worked for the city for two years. 1
Promoting the town hall. Click for larger.There is not a customary duration for events like this, although other social media town halls have been promoted by the city as lasting 90 minutes. Surely citizens might expect any meeting like this to last at least 30 minutes, if not 60 or more.
But Wichita Assistant City Manager Scot Rigby’s town hall meeting on June 20 lasted eight minutes and 22 seconds.
(A screen capture of the event is available here, and the entire event as recorded on Facebook is here.)
It wasn’t for lack of questions that the meeting ended so quickly. One question I asked had to do with the city’s reporting on its economic development efforts. The City of Lawrence annually produces a comprehensive report, but Wichita does not. 2 Rigby answered this question online, which is the way these things are supposed to work.
An excerpt from the town hall. Click for larger.Then I asked this question: “There has been a lot of investment, public and private, in downtown Wichita. What has been the trend in the number of business firms, employees, and payroll during that time?” That was six minutes and 50 seconds after the start of the meeting, according to Facebook. The meeting ended 92 seconds later with no answer to this question.
But I wanted the city to answer my question. After five weeks of multiple requests through both Facebook and email, I received a response from the city:
from: Bob Weeks
to: Scot Rigby
Hi, I’m still wondering why the social media town hall from June 20 was ended after less than nine minutes. There is still a pending question.
For your convenience, here is the link to the Facebook video:
“https://www.facebook.com/cityofwichita/videos/1450322791680383/”
Thank you,
Bob Weeks
Dear Mr. Weeks-
Scot Rigby asked that I follow up with your question since I was involved with coordination of the Social Media Town Hall events.
During the Social Media Town Hall events on June 15 and June 20 we presented content in a variety of formats on Facebook and Twitter. We used the Facebook Live format for one topic, but 30 second videos for 14 other topics (seven on each day). We publicized the Facebook Live topic the day before, and our intent was to respond to questions from that topic as well as during the event. We ended the Facebook Live event after responding to comments and feedback from June 15 and focused efforts on responding to other posts as well as Nextdoor, which we used for the first time during the Social Media Town Hall this year. Because of changes in technology, each year the Social Media Town Hall is a little different.
Sincerely-
Elizabeth
Elizabeth Goltry Wadle
Principal Budget Analyst
City of Wichita
I think I’ll characterize this as nonresponsive.
Besides this answer, the city also responded on Facebook on July 18, nearly a month after I posed the question. That response referred me to the 2016 State of Downtown Report from the Wichita Downtown Development Corporation. That is also (mostly) nonresponsive to my question.
Trends of business activity in downtown Wichita. Click for larger.In a way, I can sympathize with Rigby not wanting to answer my question. Perhaps he doesn’t know the answer. But he might know — he should know — the answer, which is that since 2007 there are fewer business establishments, fewer people working downtown, and lower earnings generated in downtown Wichita. In all cases, the trend is lower. 3
Regarding the 2016 State of Downtown Report from the Wichita Downtown Development Corporation: That document claims there are 26,000 workers in downtown Wichita. That is a large mistake and greatly overstates the number of workers. 4
It’s curious that the city did not refer me to a 2017 edition of the State of Downtown Report. But that document does not exist. It’s common for these reports to be released in May, but this year’s report is not yet available.
The city takes pride in being responsive to citizens. Former Mayor Carl Brewer often spoke in favor of government transparency. For example, in his State of the City address for 2011, he listed as an important goal for the city this: “And we must provide transparency in all that we do.”
“The City Council has stressed the importance of transparency for this organization,” City Manager Robert Layton said. “We’re honored to receive a Sunny Award and we will continue to empower and engage citizens by providing information necessary to keep them informed on the actions their government is taking on their behalf.”
Shortly after his election, current Mayor Jeff Longwell penned a column in which he said, “First off, we want City Hall to be open and transparent to everyone in the community.”
Is a lack of staff at city hall the reason why I can’t get an answer to a question? I don’t think so. Two years ago the city expanded its staff by hiring a Strategic Communications Director. When the city announced the new position, it said: “The Strategic Communications Director is the City’s top communications position, charged with developing, managing, and evaluating innovative, strategic and proactive public communications plans that support the City’s mission, vision and goals.”
My experience with this social media town hall runs contrary to the city’s proclaimed goals, and this is not the only time I’ve had problems with the city regarding requests for information. 5
