Archive for Thursday, September 20, 2001

Graves denies favoritism in proposed building buy

Governor’s close friend has stake in Topeka property, plus price exceeds state appraisal by $800,000

September 20, 2001

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— Gov. Bill Graves on Wednesday denied trying to influence the state purchase of a building that would benefit his close friend, Jack Brier.

"I can assure you there was no cozy deals," Graves said of efforts by his administration to purchase the downtown Topeka building for $6.3 million, even though the building is valued by a state appraisal at $5.5 million.

Graves said he doesn't care whether the state buys the building. The proposed purchase of the New England Building, which is currently leased by the state, was put on hold Tuesday when a legislative committee balked at paying more than the state appraisal.

Personal ties

The six-story building is owned by a number of investors, including Brier, who according to financial disclosure records has a 34 percent equity stake in the building.

Brier, a former secretary of state, was a mentor to Graves. Graves has appointed Brier, now an active real estate developer, to the Kansas Turnpike Authority and as president of the Kansas Development Finance Authority, a state agency that issues bonds for the purchase of property and other state capital improvements.

The Journal-World has learned of another state real estate transaction involving Brier.

KDFA, the agency Brier heads, is moving its Topeka offices into a building owned by another company with Brier ties.

But Brier said there is no conflict of interest involved in moving KDFA into the American Investors Life Insurance Co. building.

Brier, according to his financial statement filed with the state, is a director of the Amerus Annuity Corp., which is a holding company for American Investors Life Insurance Co. and several other financial companies.

Brier said that means he serves as a director on the board "of a holding company that owns a holding company that owns that company that I believe owns that building."

Brier is paid for serving on the Amerus board, but he declined to say how much.

Not Brier's idea

According to state officials, KDFA will be paying higher rent in its new offices than in its current place in the Jayhawk Tower.

Brier said he had nothing to do with the negotiations for the lease of office space at the American Investors Life Insurance building and that the move was requested by the KDFA board of directors.

Rebecca Floyd, executive vice president of KDFA, asked Graves' Department of Administration to handle the lease negotiations because of Brier's position with Amerus Annuity, according to an April 20 memo from Floyd to former Secretary of Administration Dan Stanley.

In addition, Floyd stated that as part of the transaction Brier and someone from American Investors Life Insurance would sign a document that says Brier would not receive any compensation from American Investors Life Insurance for the lease.

Floyd said that KDFA was paying about $14.50 per square foot at the Jayhawk building and will pay about $15.50 at the American Investors Life Insurance building.

She said the KDFA board wanted to move in order to get more space. She said the agency's current location had no room for board meetings.

The KDFA will have about 3,900 square feet of space in the American Investors Life Insurance Building. It has 2,800 square feet in the Jayhawk building, Floyd said.

Meanwhile, Graves vehemently denied having any knowledge about his administration's handling of the proposed purchase of the New England building and said he didn't care if the Joint Committee on State Building Construction approved the purchase or not.

Graves also said he was "comfortable" with the Joint Committee on State Building Construction's oversight.

"They're great Americans," he said.

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