Actions of the Wichita City Council have shown that campaign finance reform is needed. Citizen groups are investigating how to accomplish this needed reform, since the council has not shown interest in reforming itself.
In this episode of WichitaLiberty.TV: Citizen activists were concerned about unleashing a corrupting influence in Wichita City Hall, but they didn’t know it’s already there. Then, the regulatory landscape in Wichita. Finally, what can a pencil teach us about how the world works? View below, or click here to view at YouTube. Episode 121, broadcast June 12, 2016.
Shownotes
Some citizen activists and Wichita city council members believe that a single $500 campaign contribution from a corporation has a corrupting influence. But stacking dozens of the same $500 contributions from executives and spouses of the same corporation? Not a problem.
On December 1, 2015 the Wichita City Council considered an ordinance regarding campaign finance for city elections. A Wichita Eagle article on the topic started with: “A proposed change in city ordinance would allow corporations, labor unions and political action committees to have a greater influence on Wichita politics. For years, city elections have remained insulated from the power of those groups, unlike national and state elections, because Wichita ordinance specifically forbids them from contributing to local campaigns.” 1
The city believed the proposed action was necessary to comply with recent court rulings. Under the proposed ordinance — which was passed by the council — corporations, labor unions, and political action committees would be able to make a single campaign contribution per election cycle of up to $500, the same limit as for individuals.
During the council meeting, citizens testified as to the terrible consequences should the council pass this ordinance. Here are a few excerpts taken from the minutes of the meeting:
“Stated corruption and conflicts of interest have become institutionalized and what City legal counsel suggests will sell the Council and the City of Wichita to the highest bidder.”
“Stated according to a lengthy report last week, by the Pew Research Center, across party lines people are distrustful and concerned about big money in politics.”
“Stated big money does not donate, it invests and buys democracy. Stated she is asking the City Council to keep big money out of the City Council elections.”
“Allowing big money into City elections is a concern.”
“Stated the City has been independent and has a freedom from influence that the state and the nation do not enjoy. Stated you will then be under the thumb of people who want to control you. which is scary to those of them who are highly opposed to this situation and hopes that the Council will think of them and how this vote will benefit them.”
“Stated the League [of Women Voters] has studied campaign finance over the years at all three levels. Stated they are currently involved in the study of money and politics and their position currently reads that they want to improve the methods of financing political campaigns in order to ensure the public’s right to know and combat corruption and undue influence, which is their biggest concern.”
In its reporting after the meeting, the Eagle reported more concern: 2
But those who oppose the measure said they were concerned about opening up local elections to party-affiliated groups like PACs and about transparency since PACs do not have to report their individual donors.
“Individuals should decide elections, not corporations,” Frye said.
Several members of the public spoke against the changes.
“People in the shadows are going to be pulling your strings,” said Russ Pataki.
“It’s very worrisome what big money has done to state and national politics. The city has been independent (of that),” said Lynn Stephan to the council before the vote. “You have a freedom from influence the state and nation don’t enjoy.”
So, people are concerned about the corrupting influence of political campaign donations from corporations and political action committees. Citizens — and the Wichita Eagle — believe that currently the city council is free from this influence.
But the reality of city council campaign financing is different.
2008 and 2009
Executives of Key Construction and their spouses make six contributions to the Lavonta Williams campaign, totaling $3,000.
2010 and 2011
Executives of Key Construction and their spouses make eight contributions to the Carl Brewer campaign, totaling $4,000. Brewer was Wichita mayor running for re-election in 2011.
Executives of Key Construction and their spouses make eight contributions to the Jeff Longwell campaign, totaling $4,000.
2012
The City of Wichita is preparing to build a new airport terminal with a cost of around $100 million. Key Construction and Dondlinger and Sons Construction are two bidders. The contract is controversial. Dondlinger submitted a lower bid than Key, but it was alleged that Dondlinger’s bid did not meet certain requirements.
January 24, 2012
Executives of Key Construction and their spouses make six contributions to the James Clendenin campaign, totaling $3,000.
On this day and the next, executives of Key Construction and their spouses make eight contributions to the Jeff Longwell campaign for Sedgwick County Commission, totaling $4,000. At the time, Longwell was a Wichita city council member.
April 17, 2012
On this day and the next, executives of Key Construction and their spouses make eight contributions to the Lavonta Williams campaign, totaling $4,000.
July 16, 2012
An executive of a Michigan construction company and his wife contribute $1,000 to Longwell’s campaign for county commission. The company, Walbridge, is partnering with Wichita-based Key Construction to bid on the Wichita airport terminal contract.3
July 17, 2012
The Wichita city council votes in favor of Key Construction and Walbridge on a dispute over the airport terminal contract, adding over $2 million to its cost. Brewer, Longwell, Williams, and Clendenin participated in the meeting and voted. City documents state the job of the council this day was to determine whether the staff who made the decision in favor of Key Construction “abused their discretion or improperly applied the law.”4
July 20, 2012
An additional $2,250 in contributions from Walbridge executives to the Jeff Longwell campaign for Sedgwick County Commission campaign is reported.
January 2013
Williams and Clendenin file campaign finance reports for the calendar year 2012. This is the first opportunity to learn of the campaign contributions from Key Construction executives and their spouses during 2012. For Williams, the Key Construction-related contributions were the only contributions received for the year. Clendenin received contributions from Key Construction-related individuals and parties associated with one other company during the year.
Is there a pattern? Yes. Key Construction uses its executives and their spouses to stack individual contributions, thereby bypassing the prohibition on campaign contributions from corporations. This has been going on for some time. It is exactly the type of corrupting influence that citizens are worried about. It has been taking place right under their eyes, if they knew how or cared to look. And Key Construction is not the only company to engage in this practice.
Just to summarize: The Wichita city council was charged to decide whether city officials had “abused their discretion or improperly applied the law.” That sounds almost like a judicial responsibility. How much confidence should we have in the justice of a decision if a majority of the judges have taken multiple campaign contributions from executives (and their spouses) of one of the parties?
In some ways, it is understandable that citizens might not be aware of this campaign contribution stacking. The campaign finance reports that council members file don’t contain the name of contributors’ employers. It takes a bit of investigation to uncover the linkage between contributors and the corporations that employ them. For citizens, that might be considered beyond the call of duty. But we should expect better from organizations like the League of Women Voters.
Certainly there is no excuse for the Wichita Eagle to miss or avoid things like this. Even worse, it is disgraceful that the Eagle would deny the problem, as it did in its November 23 article quoted above.
In summary, some citizen activists — most council members, too — believe that a single $500 campaign contribution from a corporation has a corrupting influence. But stacking dozens of the same $500 contributions from executives and spouses of the same corporation? Not a problem.
Political campaign contributions are a form of speech and should not be regulated. What we need are so-called pay-to-play laws, which regulate the linkage between campaign contributions and council member participation in matters that benefit donors.5
Either that, or we need council members with sufficient character to recognize when they should refrain from voting on a matter.
—
Notes
An incentives agreement the Wichita city council passed on first reading is missing several items that city policy requires. How the council and city staff handle the second reading of this ordinance will let us know for whose interests city hall works: citizens, or cronies.
This week I presented the Wichita City Council my concerns about an inadequate developer agreement for a TIF district development project, the Mosley Avenue Project.
My presentation centered on the lack of an agreement by the developer to forgo appeals of the tax valuation of the property. The applicant had done this in the past, and it caused a shortfall of TIF revenue that the city had to makeup. The city manager had said that taxpayers would be protected in future deals, but the city did not include this protection in the Mosely agreement.
The omission of this taxpayer protection was not all that was missing. The Downtown Development Incentives Policy, revised by the council on June 10, 2014, calls for several items to be supplied when seeking incentives, including tax increment financing, which was the incentive requested for the Mosely project. As I show below, many significant items related to taxpayer protection were missing.
The council approved the project on first reading, noting that the development agreement would be finalized in time for second reading.
This is insufficient. The second reading of an ordinance is usually handled as part of the consent agenda. This is a grouping of items that are voted on as a group, in bulk. There is no discussion unless a council member specifically requests. The practice of the city is that the text of the ordinances on second reading is not made available in the agenda packet, even though changes may have been made between first reading and second reading. That will certainly be the case with this ordinance, as many things are missing from the development agreement.
It’s not clear why there is a first reading and a second reading of an ordinance. It may be so that details may be corrected. Or, perhaps council members would like to have a chance to reconsider their first vote. City code seems to give no guidance as to how much change to an ordinance is allowable between first and second reading.
The problem we face in Wichita is that the approval of a development plan in a TIF district has a mandated public hearing. It is not optional. But the motion passed by the council this week closed the public hearing. Yet, the city will need to make substantial changes to the ordinance and development agreement if it intends to follow the downtown incentives policy that it created. But the public will have no chance to comment on the new material. If past city practice is followed, the new material will not be made available to the public, and perhaps not to council members.
This is a conflict that I do not believe can be resolved unless the city reopens the public hearing for consideration of the revised ordinance and developer agreement on first reading. Anything else disrespects procedures that are designed to benefit and protect the public.
Except. As with many city council policies, there are loopholes. As outlined below, the council can simply vote to waive the requirements of the downtown incentives policy. That gives the council an easy out. But that makes another mockery of the city’s policies, if the council waives them whenever they are inconvenient.
When I presented the defect in the development agreement to the council I asked: Is this lack of taxpayer protection an oversight, or is it by design? There was no answer.
I did not ask this question, but didn’t any city council member notice the omission of significant items needed to comply with its own policies? What about the city manager? Economic development director? City attorney?
More importantly, who in city hall looking out for the interests of taxpayers? Could the generous campaign contributions of Burk and his wife be a factor in this missing taxpayer protection? Or the generous contributions of Key Construction and its executives? (Key Construction is frequently used by Burk.) This is one more incident illustrating the need for campaign finance reform in Wichita.
Section D of the incentives policy states “parties requesting Downtown Development Incentives must submit the information listed below.” Significant missing items included the following:
CEDBR Fiscal Impact Model
The idea behind the city’s use of economic development incentives is that the city receives more than it spends or forgoes in future tax revenue. An analysis performed by the Center for Economic Development and Business Research (CEDBR) at Wichita State University is used to make this decision. This appears to have not been done for this project.
Guarantee for a proportional share of public revenue shortfall
This was not present in the developer agreement.
Economic analysis confirms that the project is infeasible “but for” public investment
This was not present in the developer agreement.
Minimum private to public capital investment ratio of 2 to 1
Information necessary to make this judgment was not included in the agenda presentation.
Pro Forma
The incentives policy states: “Pro Forma — The project pro forma will be evaluated on the following criteria:
a. Rate of private investment return
b. Rents/prices consistent with performance of comparables
c. Projected rate of absorption consistent with performance of comparables
d. Long-term project solvency”
It appears that this analysis was not performed.
“Gap” Financing Requirement
The downtown incentives policy states: “Approval of Downtown Development Incentives will require a financial analysis demonstrating that the project would not otherwise be possible without the use of the requested development incentive (“gap” analysis). Parties requesting Downtown Development Incentives will be required to provide the City pro forma cash flow analyses and sources and uses of funds in sufficient detail to demonstrate that reasonably available conventional debt and equity financing sources are not available to fund the entire cost of the project and still provide the developer a reasonable market rate of return on investment.”
There is no evidence that this analysis was performed and made available to the council.
Waiver
The incentives policy contains a loophole. If the council believes it is “inappropriate to evaluate a particular request for Downtown Development Incentives” using the policy, it may vote to waive the requirements.
Actions of the Wichita City Council have shown that campaign finance reform is needed. Citizen groups are investigating how to accomplish this needed reform, since the council has not shown interest in reforming itself.
Consider recent actions by the council and its members:
First, overpriced no-bid contracts and other giveaways to campaign contributors isn’t economic development. It’s cronyism. It’s wasteful.
Second: Citizens become cynical when they feel there is a group of insiders who get whatever they want from city hall at the expense of taxpayers. At one time newspaper editorial pages crusaded against cronyism like this. But no longer in Wichita. The Wichita Eagle has reported on some of these issues — sometimes in depth, sometimes in passing, but some have escaped notice. The editorial page of the newspaper sometimes takes notice, but is rarely critical of the council or mayor.
Third, when it is apparent that a “pay-to-play” environment exists at Wichita City Hall, it creates a toxic and corrosive political and business environment. Companies are reluctant to expand into areas where they don’t have confidence in the integrity of local government. Will I find my company bidding against a company that made bigger campaign contributions than I did? If I don’t make the right campaign contributions, will I get my zoning approved? Will my building permits be slow-walked through the approval process? Will my projects face unwarranted and harsh inspections? Will my bids be subjected to microscopic scrutiny?
Importantly: Will the Wichita city council prop up a competitor to my company with economic development incentives that place my company at severe disadvantage?
We’d also need to add — as does New Jersey law — provisions that contributions from a business owner’s spouse and children will be deemed to be from the business itself. This is because for Kansas municipal and school district elections, only personal contributions may be made. Additionally the contributions of principals, partners, officers, and directors, and their spouses and children, are considered to be from the business itself for purposes of the law. These provisions are important, as many city council members in Wichita receive campaign contributions from business owners’ family members and employees as a way to skirt our relatively small contribution limits. For two examples of how companies use family members, employees, and friends to stack up campaign contributions, see Campaign contributions show need for reform in Wichita.
Such campaign finance reform would not prohibit anyone from donating as much as they want (up to the current limits) to any candidate. Nor would the law prevent candidates from accepting campaign contributions from anyone.
This reform, however, would remove the linkage between significant contributions and voting to give money to the contributor. This would be a big step forward for Wichita, its government, and its citizens.
Proponents see three paths towards campaign finance reform. One would be to press for a law in the upcoming session of the Kansas Legislature. Such a law would be statewide in scope, and could apply to city councils, county commissions, school boards, townships, and other elective bodies.
A second path would be to use the municipal initiative process. Under this process, a group writes a proposed ordinance. Then, it collects valid signatures on petitions. If a successful petition is verified, the city council must either (a) pass the ordinance as written, or (b) set an election to let the people vote whether the ordinance should become law.
There is also a third path, which is for the Wichita City Council to recognize the desirability of campaign finance reform and pass such an ordinance on its own initiative.
If we take the affected parties at their word, this third path should face little resistance. That’s because politicians who accept these campaign contributions say it doesn’t affect their voting, and those who give the contributions say they don’t do it to influence votes.
If politicians and contributors really mean what they say, there should be no opposition to such a law. Citizens should ask the Wichita City Council to pass a campaign finance reform ordinance that prohibits voting to enrich significant campaign contributors.
In 2008 the Wichita City Council approved a no- and low-interest loan to 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.”
When questioned about election donations:
“I would never do anything because of a campaign contribution,” said [former council member Sharon] Fearey, who received $500 from David Burk and $500 from David Wells.
“I don’t think $500 buys a vote,” said [former council member Sue] Schlapp.
“One has nothing to do with the other,” [Wichita Mayor Carl] Brewer said.
Also in 2008, the Reverend Dr. Kevass J. Harding wanted to spruce up the Ken-Mar shopping center at 13th and Oliver, now known as Providence Square. Near the end of June, Kevass Harding and his wife contributed a total of $1,000, the maximum allowed by law, to the campaign of Wichita City Council Member Lavonta Williams (district 1, northeast Wichita). This was right before Harding appeared before the city council in July and August as an applicant for tax increment district financing (TIF).
These campaign contributions, made in the maximum amount allowable, were out of character for the Hardings. They had made very few contributions to political candidates, and they appear not to have made many since then.
But just before the Ken-Mar TIF district was to be considered for approval, the Hardings made large contributions to Williams, who is the council member representing Ken-Mar’s district. Harding would not explain why he made the contributions. Williams offered a vague and general explanation that had no substantive meaning.
In August 2011 the 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.
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. In Wichita city elections, individuals may contribute up to $500 to candidates, once during the primary election and again during the general election. As you can see in this table compiled from Wichita City Council campaign finance reports, spouses often contribute as well. So it’s not uncommon to see the David and DJ Burk family contribute $2,000 to a candidate for their primary and general election campaigns. That’s a significant sum for a city council district election campaign cycle. Click here for a compilation of campaign contributions made by those associated with the Ambassador Hotel project.
Council Member Jeff Longwell (district 5, west and northwest Wichita), in his second term as council member, led the pack in accepting campaign contributions from parties associated with the Ambassador Hotel project. For his most recent election, he received $4,000 from parties associated with Key Construction, and $2,000 from David Burk and his wife. Total from parties associated with the Ambassador Hotel project: $6,000. When Longwell ran for Sedgwick County Commission this summer, these parties donated generously to that campaign, too.
Council Member Lavonta Williams (district 1, northeast Wichita) received $5,000 from parties associated with the Ambassador Hotel: $3,000 from parties associated with Key Construction, and $2,000 from David Burk and his wife.
Wichita Mayor Carl Brewer received $5,000 from parties associated with the Ambassador Hotel: $4,500 from parties associated with Key Construction, and $500 DJ Burk, David Burk’s wife.
Council Member and Vice Mayor Janet Miller (district 6, north central Wichita) received $3,500 during her 2009 election campaign from parties associated with the Ambassador Hotel: $1,500 from parties associated with Key Construction, and $2,000 from David Burk and his wife.
For his 2011 election campaign, Council Member Pete Meitzner (district 2, east Wichita) received $3,500 from parties associated with the Ambassador Hotel: $2,500 from parties associated with Key Construction, and $1,000 from David Burk and his wife.
For his 2011 election campaign, Council Member James Clendenin (district 3, southeast and south Wichita) received $1,500 from parties associated with the Ambassador Hotel: $1,000 from parties associated with Key Construction, and $500 from David Burk and his wife.
Of interest to current mayoral politics: In 2012 while Jeff Longwell was campaigning for the Sedgwick County Commission, campaign contributions from parties associated with Walbridge, a Michigan-based construction company appeared on Longwell’s campaign finance reports. Why would those in Michigan have an interest in helping a Wichita City Council member fund his campaign for a county office? Would the fact that Walbridge is a partner with Key Construction on the new Wichita Airport terminal provide a clue?
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.
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.
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. Besides the Walbridge contributions, Key Construction and its executives contributed $6,500 to Longwell’s county commission campaign. Key and its executives have been heavy contributors to Longwell’s other campaigns, as well as to Wichita Mayor Carl Brewer and many other Wichita City Council members.
In this episode of WichitaLiberty.TV: Does Wichita have a problem with cronyism? The mayor, city council, and bureaucrats say no, but you can decide for yourself. Then, from LearnLiberty.org, the harm of cronyism at the national level. Episode 48, broadcast June 22, 2014. View below, or click here to view at YouTube.
Does Wichita have a problem with cronyism? The mayor, city council, and bureaucrats say no, but you can decide for yourself. View below, or click here to view in high definition at YouTube.
In this episode of WichitaLiberty.TV: The controversy over the timing of city and school board elections provides an insight into government. Then: Can a candidate for governor’s claims about Kansas school employment be believed? Wind power is expensive electricity, very expensive. A Wichita auto dealer pushes back against union protests. Finally, what is the real rate of unemployment in America? Episode 36, broadcast March 23, 2014. View below, or click here to view at YouTube.
In this excerpt from WichitaLiberty.TV: An illustration of the need for campaign finance reform in Wichita and Kansas. A related issue is the need to change the timing of local elections in Kansas. View below, or click here to view at YouTube.
In January 2013 candidates for Wichita City Council filed campaign finance reports, and the filings illustrate the need for campaign finance reform in Wichita and Kansas.
Two incumbents, both who have indicated their intent to run in the spring elections, received campaign contributions in 2012 from two sources: A group of principals and executives of Key Construction, and another group associated with theater owner Bill Warren.
The incumbent candidates receiving these contributions are Wichita City Council Member James Clendenin (district 3, southeast and south Wichita) and Wichita City Council Member Lavonta Williams (district 1, northeast Wichita).
Except for $1.57 in unitemized contributions to Clendenin, these two groups accounted for all contributions received by these two incumbents. As the election grew nearer, other parties contributed to these candidates. But for one year, only two groups made contributions.
So do these two groups have an extraordinarily keen interest in Wichita city government that’s not shared by anyone else? Yes they do, and it’s not benevolent. Both have benefited from the cronyism of the Wichita City Council, in particular members Williams and Clendenin. We’ve covered the benefits these parties have received, such as overpriced no-bid contracts and interest-free loans made to prop up an earlier failing loan from taxpayers. We need laws in Wichita and Kansas like some states and cities have. These are generally called pay to play laws, and they can be very simple, such as elected officials can’t vote on matters that enrich their significant campaign contributors. It could be that easy. See Kansas needs pay-to-play laws for more.
Here’s something that seems inconsequential, but is really important: The timing of our city council and school board elections. Currently these are held in the spring of odd-numbered years. These elections are also non-partisan, meaning that candidates don’t run as members of a political party.
I was asked to testify before a committee of the Kansas Senate. In preparation, I did some research. I found that for elections in Sedgwick County, voter turnout in spring elections is much lower than in fall elections. Since 2000, turnout for fall elections, both primary and general, has been 44 percent. Over the same period, spring elections turnout has been 18 percent. Other research I found confirmed that this pattern is common across the country.
You may be asking: Is this a problem?
Political scientist Sarah Anzia has done the research. She wrote this in a research paper: “When an election is separated from other elections that attract higher turnout, many eligible voters abstain, but interest group members that have a large stake in the election outcome turn out at high rates regardless of the increase in the cost of voting. Moreover, interest groups’ efforts to strategically mobilize supportive voters have a greater impact on election outcomes when overall turnout is low. Consequently, the electoral influence of interest groups is greater in off-cycle elections than in on-cycle elections. As a result, the policy made by officials elected in off-cycle elections should be more favorable to dominant interest groups than policy made by officials elected in on-cycle elections.” For more on this issue, see Kansas spring elections should be moved.
Special interest groups benefit from these low-turnout spring elections. Do you remember the first story I reported on today, where campaign contributions for two Wichita city council members came from only two sources? That’s an illustration of special interest groups in action. It’s harmful to our city and its economy.
What happened to the bill I testified on? There was much opposition by cities and school boards and the special interest groups that benefit from these low-turnout, off-cycle elections. The bill went nowhere. I hope that it is revived this year for another attempt.
In this episode of WichitaLiberty.TV: A look back at a few problematic issues regarding ethical government in Wichita in 2013. Topics include: Campaign contributions, the timing of city and school board elections, Mayor Carl Brewer’s integrity and threats, the need for campaign finance reform, the firing of a television news reporter, the apparently non-transparent way the city formulates policy, and the useless feedback systems the city relies on. Episode 26, broadcast January 5, 2014. View below, or click here to view at YouTube.
Wichita never seems to learn. Its government, that is.
The last time Key Construction was awarded a no-bid contract for building a parking garage in Wichita, it almost cost Wichita taxpayers an extra 27 percent. Now the Wichita City Council has done it again, awarding Key another no-bid contract for a project paid for by taxpayers.
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.
Today the council voted to award Key another no-bid contract. City officials said that the garage is too intertwined with the rest of the project to be put out to bid. They said that in 2011, too.
After the 2011 incident, Wichita city manager Robert Layton told the Wichita Eagle that he would seek a policy change against no-bid contracts. But that didn’t happen today.
So taxpayers are likely to overpay again, and for a project benefiting a politically-connected firm.
There is hope for the taxpayers, however. After the 2011 award to Key, then-council member Michael O’Donnell objected. It’s said that Wichita City Council Member and Vice Mayor Pete Meitzner (district 2, east Wichita) also objected. That’s when the city decided to put the garage out to competitive bid and saved taxpayers $1.3 million.
It’s possible this could happen again. Meitzner was absent for today’s vote. New council member Jeff Blubaugh now represents the same district that O’Donnell did two years ago. Maybe Wichita taxpayers can ask O’Donnell to talk to Blubaugh about this. Perhaps as Meitzner prepares his bid to be the next mayor, he could use this as an opportunity to exercise leadership in favor of taxpayer stewardship instead of protecting the system of cronyism.
Should Mayor Carl Brewer have participated in voting on this matter? Here’s a section from the Wichita city code as passed in 2008:
“[Council members] shall refrain from making decisions involving business associates, customers, clients, friends and competitors.”
Wichita mayor Carl Brewer with major campaign donor Dave Wells of Key Construction.This no-bid contract for the garage is just one of many subsidies and grants given to Key Construction and its partners at taxpayer expense. Key, its executives, and their spouses 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.
Then, 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.
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) for a project, observing “Key is known for their consistent quality construction, budget control and on schedule delivery.” The mayor’s recommendation is not consistent with the reality of Key’s experience with the City of Wichita.
Although city code has no prohibition against council members voting to enrich their significant campaign contributors with no-bid contracts, there ought to be such a law. And when the recipient company is a very significant contributor, we can’t help but wonder about the wisdom and stewardship exhibited by the council.
In 2012, as incumbent council members Wichita City Council Member James Clendenin (district 3, southeast and south Wichita) and Wichita City Council Member Lavonta Williams (district 1, northeast Wichita) were preparing to run for re-election, their campaigns, that year, were financed entirely by two sources. One of these was a group of principals and executives of Key Construction.
Those associated with Key Construction gave a total of $7,000. Williams received $4,000, and $3,000 went to Clendenin. For Williams, this was the only campaign money she received in 2012.
With relationships like these, can we have and confidence that the mayor and council are looking out for the interests of the citizens of Wichita, or for the interests of the significant campaign contributors and fishing buddies?
In this episode of WichitaLiberty.TV, host Bob Weeks explains the attitude of the Wichita City Council regarding ethical behavior and reports on incidents that illustrate the need for campaign finance reform and pay-to-play laws in Wichita and Kansas. Also, Bob notices a document produced this year titled “Wichita Area Future Water Supply: A Model Program for Other Municipalities” and wonders why the city boasts of expensive water projects and long-term planning at the same time it’s forcing an austerity campaign on its citizens. Episode 4, aired July 14, 2013.
Today on the Joseph Ashby Show, the host had a few comments regarding a television news story about Wichita Mayor Carl Brewer. An excerpt follows.
The KAKE TV news story referred to may be seen here. Background on this issue is here.
When Wichita Mayor Carl Brewer was asked to refrain from voting on a matter when he has a relationship with one of the parties that will benefit from his vote, here’s what the mayor said:
“What you’re basing your information on is basically what’s been disclosed on Mr. Weeks’ website, and for his information I think he needs to get it correct. I’ve never been to the Caribbean, and most people ask me can’t he tell that that’s Lake Texoma. So I start questioning those types of things.” (Video is here.)
On his radio show, Joseph Ashby deconstructed Brewer’s remarks. Audio is here, and it’s worth listening to.
Regarding the mayor’s remarks quoted above: First, I never reported that the photograph of the mayor was taken at any location. I didn’t know where the photo was taken until the mayor said Lake Texoma at Tuesday’s council meeting. Last year I asked the mayor by email that and other questions regarding this photograph, but he chose not to respond.
Clinton Coen reports the Wichita Post published that the picture was taken in the Caribbean. As far as I know, the Wichita Post is owned by Wichita businessman Craig Gabel. Some time ago I gave that newspaper blanket permission to use my material, just as I always grant permission for any newspaper, blog, radio station, television station, think tank, advocacy group, or website to use my material. I don’t have editorial control over what they do with the material, and the mere fact that my content appears somewhere does not mean that I endorse or approve of its use.
So if the mayor has quibbles with facts that someone reported, let him direct his criticism at the responsible outlet.
But here’s the real problem with Mayor Brewer’s remarks, from Ashby on his radio show: “What does it matter how we found out about it?” And does it matter whether the mayor vacations with someone in the Caribbean or Lake Texoma?
The important fact is that on Tuesday Brewer voted to give his significant campaign contributors and fishing buddy $703,017. That’s what the mayor tried to deflect attention away from.
Today on the Joseph Ashby Show, the host had a few comments on Wichita Mayor Carl Brewer. An excerpt follows.
The video Joseph played audio from is here, and a longer video of the issue is here.
The City of Wichita should not approve a measure that is not needed, that does not conform to the city’s policy (based on relevant information not disclosed to citizens), and which is steeped in cronyism.
This week the Wichita City Council will consider authorizing industrial revenue bonds (IRB) for the Ambassador Hotel project in downtown Wichita.
In most cases, the major benefit of IRBs is exemption from paying property taxes. Since the Ambassador Hotel is located within a tax increment financing (TIF) district, it’s not eligible for property tax abatement. (Because of the TIF, the developers have already achieved the diversion of the majority of their property tax payments away from the public treasury for their own benefit.)
Instead, in this case the benefit of the IRBs, according to city documents, is an estimated $703,017 in sales tax that the hotel won’t have to pay.
The Ambassador Hotel has benefited from many millions of taxpayer subsidy, both direct and indirect. So it’s a good question as to whether the hotel deserves another $703,017 from taxpayers.
But if we follow the city’s economic development policy, the city should not authorize the IRBs. Here’s why.
The Sedgwick County/City of Wichita Economic Development Policy states: “The ratio of public benefits to public costs, each on a present value basis, should not be less than 1.3 to one for both the general and debt service funds for the City of Wichita; for Sedgwick County should not be less than 1.3 overall.”
The policy also states that if the 1.3 to one threshold is not met, the incentive could nonetheless be granted if two of three mitigating factors are found to apply. But there is a limit, according to the policy: “Regardless of mitigating factors, the ratio cannot be less than 1.0:1.”
In September 2011 the city council passed a multi-layer incentive package for Douglas Place, now better known as the Ambassador Hotel and Block One. Here’s what the material accompanying the letter of intent that the council passed on August 9, 2011 held: “As part of the evaluation team process, the WSU Center for Economic Development and Business Research studied the fiscal impact of the Douglas Place project on the City’s General Fund, taking into account the requested incentives and the direct, indirect and induced generation of new tax revenue. The study shows a ratio of benefits to costs for the City’s General Fund of 2.62 to one.”
The same 2.62 to one ratio is cited as a positive factor in the material prepared by the city for Tuesday’s meeting.
So far, so good. 2.62 is greater than the 1.3 that city policy requires. But the policy applies to both the general fund and the debt service fund. So what is the impact to the debt service fund? Here’s the complete story from the WSU CEDBR report (the report may be viewed at Wichita State University Center for Economic Development and Business Research Study of Ambassador Hotel):
Cost-benefit ratio
City Fiscal Impacts General Fund 2.63
City Fiscal Impacts Debt Service Fund 0.83
City Fiscal Impacts 0.90
We can see that the impact on the debt service fund is negative, and the impact in total is negative. (A cost-benefit ratio of less than one is “negative.”)
Furthermore, the cost of the Ambassador Hotel subsidy program to the general fund is $290,895, while the cost to the debt service fund is $7,077,831 — a cost factor 23 times as large. That’s why even though the general fund impact is positive, the negative impact of the much larger debt service fund cost causes the overall impact to be unfavorable.
The city didn’t make this negative information available to the public in 2011, and it isn’t making it available now. It was made public only after I requested the report from WSU CEDBR. It is not known whether council members were aware of this information when they voted in 2011.
So the matter before the council this week doesn’t meet the city’s economic development policy standards. It’s not even close.
There are, however, other factors that may allow the city to grant an incentive: “In addition to the above provisions, the City Council and/or County Commission may consider the following information when deciding whether to approve an incentive.” A list of 12 factors follows, some so open-ended that the city can find a way to approve almost any incentive it wants.
A note: The policy cited above was passed in August 2012, after the Ambassador Hotel incentives package passed. But the 1.3 to one threshold was de facto policy before then, and whether a proposed incentive package met that standard was often a concern for council members, according to meeting minutes.
Citizens might wonder why industrial revenue bonds are being issued for a hotel that’s complete and has been operating for over three months. The truly cynical might wonder why this matter is being handled just two weeks after the city’s general election on April 2, in which four city council positions were on the ballot. Would citizens disagree with giving a hotel $703,017 in sales tax forgiveness? Would that have an effect on the election?
Campaign contributions received by James Clendinin from parties associated with Key Construction. Clendenin will vote tomorrow whether to grant sales tax forgiveness worth $703,017 to some of these donors. (Click for larger view.)Combine this timing with the practice of part of the hotel’s ownership team of engaging in cronyism at the highest level. Dave Burk and the principals and executives of Key Construction have a history of making campaign contributions to almost all city council candidates. Then the council rewards them with overpriced no-bid contracts, sweetheart lease deals, tax abatements, rebates of taxes their customers pay, and other benefits. The largesse dished out for the Ambassador Hotel is detailed here. This hotel, however, was not the first — or the last time — these parties have benefited from council action.
Campaign contributions received by Lavonta Williams from parties associated with Key Construction. Williams will vote tomorrow whether to grant sales tax forgiveness worth $703,017 to some of these donors. (Click for larger view.)Campaign finance reports filed by two incumbent candidates illustrate the lengths to which Key Construction seeks to influence council members. Wichita City Council Member James Clendenin (district 3, southeast and south Wichita) and Wichita City Council Member Lavonta Williams (district 1, northeast Wichita) received a total of $7,000 from Key Construction affiliates in 2012. Williams received $4,000, and $3,000 went to Clendenin. For Williams, these were the only contributions she received in 2012.
A table of campaign contributions received by city council members and the mayor from those associated with the Ambassador Hotel is available here.
Wichita mayor Carl Brewer with major campaign donor Dave Wells of Key Construction. Brewer will vote tomorrow whether to grant a company Wells is part owner of sales tax forgiveness worth $703,017.This environment calls out for campaign finance reform, in particular laws that would prohibit what appears to be the practice of pay-to-play at Wichita City Hall.
There was a time when newspapers crusaded against this type of governance. Unfortunately for Wichitans, the Wichita Eagle doesn’t report very often on this issue, and the editorial board is almost totally silent. Television and radio news outlets don’t cover this type of issue. It’s left to someone else to speak out.
In his paper History and Constitutionality of Pay-to-Play Campaign Finance Restrictions in America Greg Schmid explains the problems that result from the “soft corruption” that pay-to-play laws combat.
Is this a problem in Wichita? Is it possible that “Graft takes the collective wealth of working taxpayers and transfers that wealth to the benefit of corrupt government officials and their private sector accomplices” in Wichita?
Yes. Absolutely. As explained in In Wichita, a quest for campaign finance reform, we have a problem.
An example: In August 2011 the Wichita City Council voted to award Key Construction a no-bid contract to build the parking garage that is part of the Ambassador Hotel project, now known as Block One. The no-bid cost of the garage was to be $6 million, according to a letter of intent. Later the city decided to place the contract for competitive bid. Key Construction won the bidding, but for a price $1.3 million less.
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.
What citizens need to know is that the Wichita City Council 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 council members. Only one council member, Michael O’Donnell, voted against this no-bid contract. No city bureaucrats expressed concern about this waste of taxpayer money.
As elections approach, Wichita voters ought to remember that the three incumbents running for reelection all accepted campaign contributions from the parties that they voted to reward with an overpriced no-bid construction contract.
Following, Greg Schmid explains the problem in this excerpt from History and Constitutionality of Pay-to-Play Campaign Finance Restrictions in America:
The Problem
Graft is nothing new in the world, especially soft “white collar” corruption involved in the award of government contracts based on “special relationships” between public officials and government contractors. Particular acts of corruption are often hard to detect, one at a time, but the aggregate effects of “Pay to Play” are reflected by the heavy financial toll that corrupted actors within our government system take on the taxpayer. Graft takes the collective wealth of working taxpayers and transfers that wealth to the benefitof corrupt government officials and their private sector accomplices. Graft increases the cost of government by motivating officials “on the take” to mismanage government project spending. An inside deal, that is good for the corrupt official personally, usually leads to a bad economic decision for the public because the extra cost of corruption must be passed on to the taxpayer; a bought politician tends to make distorted choices. This “mismanagement effect” is costly to the public trust. One dollar of corruption is estimated to impose a burden of $1.67 on the taxpayers. …
Efforts to make government transactions transparent are met with disdain and with incredulous personalized claims that people who don’t trust their public officials are just paranoid, and should not be allowed to interrupt the people’s business by prying into the inner workings of government procurements. Fear of being targeted for ridicule or worse by society’s powerful elite makes it easy to look the other way, live in denial, or just accept government corruption as the way of the world. This is the most dangerous attitude of all; the perception that our government system is just unethical and corrupt and that there is nothing anyone can do about it. By this attitude, the perception of pervasive corruption at all levels of government, citizens lose hope and lose faith in their governing institutions. When this fundamental disconnect occurs people disengage from government, and self-governance is at risk.
It’s hard to obtain and use local office campaign finance reports in Kansas. In Sedgwick County, for example, candidates for local offices file reports on paper with the county election office. These reports are scanned and made available online.
That sounds good. But the online system is very difficult to use. It’s hard to find the reports you want to view.
Until recently the system didn’t support modern browser programs like Firefox and Chrome. I kept a Windows virtual PC on hand and maintained with an old version of Windows and Internet Explorer for the sole purpose of using the document system at Sedgwick County.
It’s better now. You can use modern browser programs. But how many people will make the effort of creating a virtual PC so to obtain campaign finance data?
Then, the data you download or print is not machine readable. It’s images of text. It’s not searchable. It can’t be loaded into a spreadsheet or database, except by hand, or in some limited cases, through optical character recognition.
The campaign finance reports can’t be linked to like other documents that are online, like you can link to an agenda or the minutes of meetings.
The Johnson County election office didn’t do any better. There, the finance reports I looked at were available as multi-page TIFF files. These are difficult to work with. The software that most people have on their computers will show just the first page, probably.
We can do better.
As a start, I’ve created a collection of campaign finance reports from Sedgwick County. It’s not comprehensive. The documents are images as provided by the election office, meaning they’re not searchable and can’t be loaded into a spreadsheet or database.
But it’s something more than the government provides. Click here to see.
At a recent Wichita City Council meeting, Council Member Jeff Longwell (district 5, west and northwest Wichita) was critical of topics broached by two speakers, admonishing them to “take a different approach.”
The speakers had mentioned votes made and actions taken by the council and the appearance of influence or linkage to campaign contributions.
Longwell’s concern is understandable. As perhaps the most accomplished practitioner of cronyism on the council, he’s dished out millions in taxpayer subsidy to his significant campaign contributors. His acceptance of campaign contributions last summer from a Michigan construction company that had business before the council lifted cronyism to new heights.
After that, I thought that we wouldn’t ever see a more blatant instance of the appearance of impropriety. That is, until Mayor Carl Brewer started selling his barbeque sauce at a movie theater he’s voted to grant taxpayer subsidy to, several times.
These incidents are embarrassing for Wichita. So I can understand that Longwell doesn’t want them mentioned in public. I’m sure that’s what he would prefer.
That’s why it’s surprising that he would speak out at a council meeting. Why call additional attention to your bad behavior?
I think I know the answer: It is not possible to shame Longwell, Brewer, and most other council members. They believe their conduct is honest, forthright, and above reproach. They believe it is their critics who are harming the city’s reputation.
But in many cities, the routine practice of most Wichita City Council members would be a violation of the city’s ethics code, or even of city law. An example is from Westminster, Colorado. Its charter reads:
The acceptance or receipt by any Councillor or member of that Councillor’s immediate family, or an organization formed to support the candidacy of that Councillor, of any thing of value in excess of one-hundred dollars ($100) from any person, organization, or agent of such person or organization, shall create a conflict of interest with regard to that Councillor’s vote on any issue or matter coming before the Council involving a benefit to the contributing person, organization, or agent, unless such interests are merely incidental to an issue or question involving the common public good.
In commenting on this ordinance, CityEthics.org noted:
Westminster goes right to the heart of the matter — not the contribution itself, which is central to citizens’ expressions of their political preferences — but the effect of the other sort of contribution, the large contribution intended, possibly, not only to express a political preference (or not even, since often large contributions are given to both or all candidates by the same individual or entity), but also to influence the candidate.
If the contribution was not intended to influence the candidate, then the contributor won’t mind that the candidate cannot participate or vote on any matter dealing with the contributor’s interests. In addition, the candidate will not be placed in the position of appearing to favor someone who gave him or her a sizeable contribution or — and this is certainly possible if the candidate is truly independent — having to vote against a strong supporter. It’s a win-win situation for everyone, so long as there was no intent to influence.
In Wichita, we don’t have any laws or codes of ethics that prohibit or discourage what Westminster, Colorado does. We don’t even have many council members who think these are desirable.
Instead, the solution preferred by Wichita’s political class is to follow Jeff Longwell’s advice: Just don’t talk about it.
In August 2011 the 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.
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. In Wichita city elections, individuals may contribute up to $500 to candidates, once during the primary election and again during the general election. As you can see in this table complied from Wichita City Council campaign finance reports, spouses often contribute as well. So it’s not uncommon to see the David and DJ Burk family contribute $2,000 to a candidate for their primary and general election campaigns. That’s a significant sum for a city council district election campaign cycle. Click here for a compilation of campaign contributions made by those associated with the Ambassador Hotel project.
Council Member Jeff Longwell (district 5, west and northwest Wichita), in his second term as council member, led the pack in accepting campaign contributions from parties associated with the Ambassador Hotel project. For his most recent election, he received $4,000 from parties associated with Key Construction, and $2,000 from David Burk and his wife. Total from parties associated with the Ambassador Hotel project: $6,000. When Longwell ran for Sedgwick County Commission this summer, these parties donated generously to that campaign, too.
What citizens need to know is that the Wichita City Council 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 council members. Only one council member, Michael O’Donnell, voted against this no-bid contract. No city bureaucrats expressed concern about this waste of taxpayer money.
Then, last summer while Longwell was campaigning for the Sedgwick County Commission, campaign contributions from parties associated with Walbridge, a Michigan-based construction company appeared on Longwell’s campaign finance reports. Why would those in Michigan have an interest in helping a Wichita City Council member fund his campaign for a county office? Why should we in Wichita care if they do?
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.
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.
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. Besides the Walbridge contributions, Key Construction and its executives contributed $6,500 to Longwell’s county commission campaign. Key and its executives have been heavy contributors to Longwell’s other campaigns, as well as to Wichita Mayor Carl Brewer and many other Wichita City Council members.
When asked about the Michigan contributions, Longwell stated “We often get contributions from a wide variety of sources, including out-of-town people,” according to the Wichita Eagle.
But 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 only three contributions totaling $1,500 from addresses outside Kansas.
Candidates for Wichita City Council have filed campaign finance reports, and the filings illustrate the need for campaign finance reform in Wichita and Kansas.
Two incumbents, both who have indicated their intent to run in the spring elections, received campaign contributions in 2012 from two sources: A group of principals and executives of Key Construction, and another group associated with theater owner Bill Warren.
The incumbent candidates receiving these contributions are Wichita City Council Member James Clendenin (district 3, southeast and south Wichita) and Wichita City Council Member Lavonta Williams (district 1, northeast Wichita).
Except for $1.57 in unitemized contributions to Clendenin, these two groups accounted for all contributions received by these two incumbents.
Those associated with Key Construction gave a total of $7,000. Williams received $4,000, and $3,000 went to Clendenin.
Those associated with Warren gave $5,000, all to Clendenin.
So do these two groups have an extraordinarily keen interest in Wichita city government that’s not shared by anyone else?
Yes they do, and it’s not benevolent. Both have benefited from the cronyism of the Wichita City Council, in particular members Williams and Clendenin.
Here’s one example, perhaps the worst. In August 2011 the 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.
Both Williams and Clendenin voted for this no-bid contract that was contrary to the interests of taxpayers. They didn’t vote for this reluctantly. They embraced it.
Last summer Williams and Clendenin, along with the rest of the council, 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.
Judges shouldn’t preside over decisions that hugely enrich their significant campaign contributors. No matter what the merits of the case, this is bad government.
Did Key’s political involvement and campaign contributions play a role in the council awarding the company a no-bid garage contract and the airport contract? Key Construction executives and their spouses are among a small group who routinely make maximum campaign contributions to candidates. These candidates are both liberal and conservative, which rebuts the presumption that these contributions are made for ideological reasons, that is, agreeing with the political positions of candidates. Instead, Key Construction and a few others are political entrepreneurs. They seek to please politicians and bureaucrats, and by doing so, receive no-bid contracts and other benefits. This form of cronyism is harmful to Wichita taxpayers, as shown by the Ambassador Hotel garage.
Warren and his business partners have received largess from the council, too. In 2008 (before Clendenin joined the council) the Wichita City Council approved a no- and low-interest loan to 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.”
The campaign finance reports of Williams and Clendenin reinforce and spotlight the need for campaign finance reform in Wichita and Kansas.
When it is apparent that a “pay-to-play” environment exists at Wichita City Hall, it creates a toxic and corrosive political and business environment. Companies are reluctant to expand into areas where they don’t have confidence in the integrity of local government. Will I find my company bidding against a company that made bigger campaign contributions than I did? If I don’t make the right campaign contributions, will I get my zoning approved? Will my building permits be slow-walked through the approval process? Will my projects face unwarranted and harsh inspections? Will my bids be subjected to microscopic scrutiny?
We need laws to prohibit Wichita city council members from voting on or advocating for decisions that enrich their significant campaign contributors. Citizens are working on this initiative on several fronts. Some find the actions of these candidates so distasteful and offensive that they are willing to take to the streets to gather thousands of signatures to force the Wichita City Council to act in a proper manner.
That huge effort shouldn’t be necessary. Why not? The politicians who accept these campaign contributions say it doesn’t affect their voting, and those who give the contributions say they don’t give to influence votes.
If politicians and contributors really mean what they say, there should be no opposition to such a “pay-to-play” law. Citizens should ask the Wichita City Council to pass a campaign finance reform ordinance that prohibits voting to enrich significant campaign contributors.
Wichita City Council Member Michael O’Donnell (district 4, south and southwest Wichita) made a mistake when he recently offered his opinion to the Sedgwick County Commission. The mistake was noted and corrected before the commissioners voted, so it had no influence on how the commissioners voted.
Yet, all members of the Wichita City Council have “expressed varying degrees of anger” over O’Donnell’s statement, according to Wichita Eagle reporting. (O’Donnell won’t be censured for remarks to County Commission)
Before these council members and the mayor express much more angst, they should take a look at their own actions, and how O’Donnell successfully opposed their assault on Wichita taxpayers.
In September 2011, all council members except O’Donnell voted to award a no-bid contract to a construction company for a parking garage and retail space as part of the Ambassador Hotel project, then known as Douglas Place and now known as Block One. (Mayor Carl Brewer was absent that day, but earlier he voted for the letter of intent to do the same.)
Then, thanks to O’Donnell and Pete Meitzner (district 2, east Wichita), the city put the contract out for competitive bid. The result was a price about 20 percent less, saving taxpayers over $1.2 million. (Wichita city manager proposes eliminating no-bid construction projects, February 5, 2012 Wichita Eagle.)
Ironically, the company that submitted the winning bid was the same company that received the no-bid contract: Key Construction, a company well-known for its owners’ and executives’ campaign contributions to Mayor Brewer and nearly all council members, regardless of political ideology. Also involved in the project was Dave Burk, who along with his wife also make large and regular contributions to a broad range of council members.
Wichitans need to know that all except O’Donnell — and belatedly, Meitzner — thought it was proper to award their significant campaign contributors with a padded contract that awarded excess profits to Key at the expense of taxpayers.
Wastefully squandering taxpayer money in order to reward significant campaign contributors is not productive economic development. Instead, it’s cronyism of the worst kind, and illegal in some places. In Wichita, however, this is standard operating practice for some council members.
Such blatant cronyism reduces the prosperity of our community. It causes citizens to lose confidence in government. It stirs citizens to petition their government for redress. That literally happened in Wichita, motivated in part by behavior like this.
The bad behavior of the Wichita City Council has received national attention. In its commentary on the successful referendum in Wichita this year, the Wall Street Journal remarked: “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.”
Now citizens are investigating campaign finance reform laws that would, hopefully, reduce the incentive for the shameful practice of awarding no-bid contracts to significant campaign contributors. As the Wichita City Council, except for O’Donnell, has shown no interest in reforming itself, citizens must do it themselves.
Instead of being angry with the departing O’Donnell, the council and mayor should look at themselves first and reform their proven harmful practices.
