Topeka A state agency led by Gov. Bill Graves' close friend, Jack Brier, decided Friday to issue millions of dollars worth of bonds to purchase a building Brier partly owns.
The decision to purchase the new maintenance and storage facility at Topeka's Billard Airport was made earlier in the week by the Graves administration and will cost at least $4.1 million, but possibly as much as $5.5 million.
Brier said he saw no conflict of interest in the deal, although he will profit from the building's purchase to be financed by bonds issued by Kansas Development Finance Authority.
Graves appointed Brier president of the agency in July 2000 at a salary of $101,000.
The purchased building will be used by the Kansas Highway Patrol.
Brier also said he saw no problem being part of the team that successfully bid for the building and negotiated with the Graves administration during its construction while president of the KDFA.
But Brier's involvement in the Highway Patrol building and other state real estate deals is raising eyebrows, and at least one legislator wants an investigation.
A 'definite pattern'
Last month, lawmakers balked at purchasing a downtown Topeka building partially owned by Brier. Lawmakers said the asking price of $6.3 million was $800,000 more than the appraised value.
Last month KDFA moved its offices into a building owned by an insurance company that includes Brier on its board of directors. Rent at the new location is higher than KDFA had been paying.
"There is a definite pattern here," Senate Democratic Leader Anthony Hensley of Topeka said. "The state acquires buildings, and Jack Brier is involved."
Hensley said he wants state auditors to look at all real estate transactions between the state and Brier. He said he will request an audit at the next meeting of the Legislative Post-Audit Committee.
"As president of the KDFA, he (Brier) has to come under close scrutiny," Hensley said.
Conflict of interest
When Graves appointed him president of KDFA, Brier sought a legal opinion whether his position with KDFA would pose a conflict of interest with his interest in developing the maintenance and storage facility at Billard.
The legal opinion by Graves' administration attorneys said Brier did not have a conflict because any contract on the building would involve the development group, which included Brier, and the highway patrol, not the KDFA.
The building was constructed through a joint venture including Brier Development Co., which is led by Jack Brier.
According to state records, Brier assigned a $125,000 certificate of deposit to the state "to cover 5 percent of the most expensive parcel of land."
Brier said he also owns 70 percent of a partnership that owns 30 percent of the total project.
As part of the ownership group, Brier attended meetings with Graves' Department of Administration concerning the construction of the building. Under the proposal, the state could either lease the building or purchase it outright.
Earlier this week, Graves' Secretary of Administration Joyce Glasscock decided that the state should purchase the building instead of leasing it, saying that would save the state money in the long run. Renting the building would cost about $480,000 per year, Glasscock said. The building will be for Highway Patrol storage and a vehicle maintenance facility.
Brier said he was surprised at the decision. He said he would never advise someone to buy a building before they occupied it for a while.
When the request for bonds to purchase the building came over to KDFA, Brier said he recused himself from discussing the matter with the KDFA board members.
The KDFA did make the bond issuance dependent on a positive determination by the Kansas Governmental Ethics Commission that Brier's involvement was OK.
But Carol Williams, executive director of the commission, said she has already given state officials a verbal opinion that Brier has no conflict of interest.
The deal is conflict free, she said, because the purchase contract will be between the Highway Patrol and Brier's partnership, not between KDFA and Brier's partnership.
Robert Guenthner of Wichita, vice chairman of the KDFA board, said he believed the purchase of the building was above board.
"At least on the surface, the appearance looks a little awkward that the KDFA would do something to benefit Jack Brier directly," he said.
Guenthner said KDFA didn't approve the bonds to benefit Jack Brier, but because the Graves' administration wants to buy the building.