Archive for Monday, January 23, 2012

Audit criticizes Kansas Bioscience Authority, leader

January 23, 2012, 4:22 p.m. Updated January 24, 2012, 11:12 a.m.


— The former head of the Kansas Bioscience Authority destroyed documents after his resignation, paid for an airplane trip to a job interview with KBA funds and failed to notify the board of a relationship with a staff member, according to an audit released on Monday.

Related document

Bioscience Authority forensic audit ( .PDF )

The former head of the Kansas Bioscience Authority destroyed documents after his resignation, paid for an airplane trip to a job interview with KBA funds and failed to notify the board of a relationship with a staff member, according to an audit released on Monday.

Tom Thornton, the former head of the Bioscience Authority, resigned in April from his job, which paid $265,000 annually. Thornton reimbursed the authority last week in the amount of $4,679.88, according to a statement from the authority, for the plane trip, and also for an inadvertent duplicate expense reimbursement, an overpayment on a car allowance and the personal use and gifting of a KBA-owned painting.

The KBA hired the auditing firm BKD LLP to conduct the independent audit after state Sen. Susan Wagle, a Republican from Wichita and chair of the Senate Commerce Committee, was critical of several aspects of the authority, including the size of its salaries, its expenses and some of its investments. Gov. Sam Brownback also later called for the audit.

James A. Snyder, managing partner of BKD LLP, said the audit raised no major issues with the authority’s investment programs or conflict of interest policies.

“Generally, we find things to be pretty good with a couple of exceptions that are noted in the report,” he said.

According to the audit report, Thornton used computer cleanup and drive wiping tools to clear his computer hard drive on April 21 and 22, 2011, after his April 13 resignation, and before returning the computer to the KBA on April 26.

He told auditors he cleared the computer because he had used the KBA-owned computer for personal use and that it contained “personal financial and tax information, family photos and other information of a personal nature, some of which would be embarrassing if made public,” according to the report.

The audit also identified issues with compliance with the authority’s contract policy, finding 301 payments without a contract, including 102 payments that violated the KBA’s policy. Those payments totaled more than $570,000.

The audit also indicated that former board member Angela Kreps may have been in “technical violation” of the KBA’s conflict of interest policy by voting on funding for KansasBio, a bioscience trade organization of which Kreps served as president.

The audit also found Thornton failed to inform the KBA board members of a relationship with a KBA staff member, Lindsay Holwick, who would become his wife.

David Vranicar, who had been president of the KBA’s commercialization arm, has served as the authority’s interim president and CEO since Thornton left the authority.

While Brownback and Wagle criticized Thornton, other legislative leaders issued statements praising his efforts following his resignation.

After resigning, Thornton took a position with the Cleveland Clinic in Ohio.

In one case, Wagle alleged that the Wichita-based Center of Innovation in Biomedical and Orthopedic Research had been promised $20 million from the board, but never received the full amount.

A separate auditing firm, Meara Welch Brown, also hired by the KBA, investigated that claim. The firm could not identify documents, records or correspondence where a commitment of $20 million had been made.

The authority is projected to spend about $960,000 on the audits.

The Johnson County District Attorney’s Office has confirmed it was conducting a criminal investigation into the authority, but has not disclosed details of the investigation.

Brownback said the audit's findings were "deeply troubling."

He added, "This is not how we do business in the state of Kansas."

Brownback urged the KBA board to issue a moratorium on new spending and new commitments until the Legislature decides the KBA's future.

But KBA Board Chairman Dan Watkins of Lawrence said the audit showed that the KBA's investment process was sound, and that there were no significant findings of conflicts of interest.

“You can’t grow with moratoriums,” he said, responding to the governor’s statement. “We’ll operate within the authority of the Legislature as created unless the Legislature tells us differently.”

He also said the audit report should clear the air regarding questions and allegations raised in the past year.

Wagle said the audit "clearly shows a dysfunctional agency." She said she had concerns about the destruction of documents, and cronyism and what she said was a lack of accountability at the agency.

She said the Legislature would spend a lot of time combing through the audit. Committees have scheduled hearings for Wednesday and Thursday on the audit and the KBA.


dabbindan 6 years, 5 months ago

haven't we learned any thing in the last couple hundred or perhaps thousand of years? where ever there is an appealing pile of money--be it the concession proceeds for the local little league ball club or tickets to college basketball games--the funds MUST have security safeguards built in EVERY TIME. big fancy piles of money will often either attract big fancy crooks or make one out of a marginal human being. you may not have had a risky situation in the beginning, but temptation will corrupt the morally weak or attract a certain morally challenged human.

you have to anticipate it...and be pleased when it doesn't happen.

hyperinflate 6 years, 5 months ago

More like be suspicious when it is claimed not to have happened ... especially when the pile of money is large.

The well-connected will always take care of their own.

imastinker 6 years, 5 months ago

960k for an audit? I think we should audit the autiting company.

bad_dog 6 years, 5 months ago

Well, they did get $4,679.88 back...

haggisgirl 6 years, 5 months ago

I have not read the audit but based on this article, Wow, it cost close to a million dollars to conduct an audit demanded by the Governor and Wagle that found $4,679.88 in over payments to Tom Thornton and he erased his computer? That's it? Sounds to me like the KBA is handling their money very well. And yet, Brownback doesn't think that's the way we do business in Kansas? Huh?

deec 6 years, 5 months ago

Maybe the right cronies didn't get their cut. Yet.

Phillbert 6 years, 5 months ago

So the state spent $1 million to debunk a Susan Wagle claim? Fiscal conservatism at work!

Though like Wagle and Brownback say, clearly the solution to their untrue allegations of political to turn these decisions over to political appointees.

Evan Ridenour 6 years, 5 months ago

So the state spends almost $1 million on an audit that uncovers less than $5,000 of misused funds and it is the KBA that is unable to handle its money well?


kso119 6 years, 5 months ago

This audit is political vandetta against THornton and can't be any more triumphant in tarnishing his reputation then trying to stick an oyster in a slot machine!! Come on people! The KBA won $650 million in federal money, luring companies and researchers. It was a national model for bioscience growth setting the highest water mark to date thanks to Thornton's leadership! Now it's a toady to Brownback's conservative agenda. Sad the KBA and THornton should be dragged through this politics. I'm outraged at the expense of the audit and let's remind ourselves who's paying for it in the end...

Joe Blackford II 6 years, 5 months ago

"who's paying for it in the end..." naive Kansans are getting it in the end:

Google a little on "David R. Franz": KSU alum/KBA executive committee director/NIH dual use research committee/VP mriglobal/DHS HSSTAC member/USAMRIID Commander & Anthrax Mailer enabler.

Franz had connections with Tom Thornton while he was Congressman Dennis Hastert's staffer who worked with Big Pharma to get legislation passed shielding them from lawsuits re: the effects of administering vaccines. The audit shows Franz okayed hiring Thornton.

Pandemic funding, liability shield clear Congress

Thornton was working with an anthrax vaccine developer while he was still on the KBA payroll.

The KBA has been funding only what Franz would approve; ask any firm which proposed research not liked by the KBA for unknown reasons. Franz had the KBA send $3 Million to KSU's National Agricultural Biosecurity Center, while he was director of the NABC.

Franz recused himself from > $340K of contracts with his employer, MRI aka MRIGlobal. $200K for "NBAF GOCO Strategy." Look for MRIGlobal to run the NBAF as a Govt-Owned, Contractor Operated entity. Whose idea do you think it was for the NBAF to be a GOCO?

Franz is a VP @ MRIGlobal, running their GOCO @ USAMRIID (where Franz was Commander).

Should a Foot & Mouth Disease release occur, look for that $5 Billion payment to cull herds within 200 miles of KSU to come from MRIGlobal, just like BP in the Gulf.


We naive Kansans don't even need to know that Franz sits on the committee which picked KSU for the NBAF, the DHS Homeland Security Science & Technology Advisory Committee. Also the committee which decided Plum Island shouldn't be updated, & wasn't fit for the research directed to KSU.

Kansans, as naive as those DCers can imagine. Just get 'em to figure it's a Brownback / Wagle disinformation campaign & NOT a scheme to put $ into the pockets of Franz & his cronies.

thecoldhardtruth 6 years, 5 months ago

It could not be more clear that three things are going on here. First, Susan Wagle has been browbeating the KBA to give more money to Wichita State University. She went public with an accusation that KBA had committed $20M to WSU's CIBOR but had granted $4M. Now the auditor says there was never any kind of commitment like that, explicit or implied. I read in the paper a while back that KBA gave CIBOR some more money anyway, so mission accomplished there, and a waste to taxpayer money if you ask me. Second, Governor Brownback wants control of the money at the KBA. I would guess to reward his friends at K-State and in Wichita, and to cut corporate taxes. Third, he is more than happy to trash an important accomplishment of Governor Sebelius, just in case she has ambition to run for an office that he might want for himself or one of his friends. This is hard ball politics. It is plain to see that an audit demanded by Wagle and Brownback that cost a million dollars and turns up less than five thousand dollars of issues, was a witch hunt from the start. They have egg mcmuffin all over their face tonight.

Joe Blackford II 6 years, 5 months ago

As Secretary of H&HS, Sebelius will Okay Big Pharma to vaccinate ALL of us, under those rules Thornton helped to sneak past congress in the dead of night as a rider on a defense appropriations bill.

KBA has been showering Wefald's dream of the NBAF since the hiring of Dr. Jerry Jaax in 2000 (Franz' USAMRIID subordinate) as KSU University Veterinarian. Jaax has drawn > $1 Million in salary for the NBAF Dog & Pony Show.

You Larryvillians do know the NBAF storm water drainage overflow will be pumped to the Big Blue & downriver to you, don't you? The Manhattan City Commission approved the NBAF plat & drainage design in Sept 2010.

lunacydetector 6 years, 5 months ago

it was nice the kba got to hire the firm to do the audit....

mloburgio 6 years, 4 months ago

Sen. Pat Roberts were still waiting on, Phase II of its investigation into the bushes use of prewar intelligence leading to the iraq war.

quetzal 6 years, 4 months ago

I have read the audit in full. All financials were sound, investments were done professionally (with no political leanings, unlike Wagle's way of using state funds) and nothing turned up missing or in question. All of Wagle's absurd accusations last year proved to be false and nothing more than a fishing expedition. Under Thonton's leadership Kansas won a $650 million federal lab, created jobs, and brought Kansas to the 5th ranked bioscience state in the nation. I cannot believe we are talking about $4000 in expenses when tax payers spent $1 million to fund what is clearly one big political witch hunt, and the Governor's excuse to take control over yet another agency. Politics at its best folks.

hyperinflate 6 years, 4 months ago

FWIW, the auditing firm BKD is a Missouri company. Not that it should surprise anyone that they wouldn't select Kansans to do the work.

Joe Blackford II 6 years, 4 months ago

It's not what the audit found, it's the carpet over KBA's Executive Commitite Director, Dr. David R. Franz, & VP, MRI, & his between the audit lines connected to your "$650 million federal lab" ($1 Billion is more like it, it ain't built yet). No way he influenced his KBA to pick MRIGlobal for the $200K "N B A F G O C O Strategy" contract. Not after he sat in on hiring Tom Thornton.

The dirt is that there never was any "competition" to get the NBAF, it was a rigged deal the Colonels conned Kansas & 4 other states into spending on the illusion of a "curtain of transparency," as then-senator Brownback put it. No audit will ever uncover the minutes of meeting that were not kept, nor what Thornton shredded on his laptop.

Would it surprise you to find out KSU Prez Kirk Schulz worked the Mississippi effort to secure the NBAF. No, I thought not. You swallowed the Colonels' propaganda, hook, line & sinker.

You'll find the Ft. Leavenworth Command & General Staff College offers coursework in miitary propaganda, but don't Google yourself into enlightenment.

Ockhams_Razor 6 years, 4 months ago

For a million bucks, I hope this public document gets posted online somewhere so the taxpayers can read it if they want to.

somedude20 6 years, 4 months ago

Coming from the same chumps that yell about voter fraud.....dey b woofin dat bull spit all round dis state

jayhawklawrence 6 years, 4 months ago

The corrupt investigating the corrupt and burning up the money we need in our communities.

Don't call these people leaders.

Call them politicians who abuse the system.

took_the_money_and_ran 6 years, 4 months ago

So Tom Thornton may be an operator. This is a job for an operator. The standard for success is how well the operator operates on your behalf.

Joe Blackford II 6 years, 4 months ago

No, Thornton is more of a Jonas Nightingale type. The standard for success is how much snake oil the flimflam man sells to the rubes in attendance. Few of the KBA's successes have brought a significant # of jobs to more than the inner circle who keep approving each other's ideas.

View "Leap of Faith" to get a better idea of your perception skills.

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