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Regents approve WSU lease with regent’s private company, terms of agreement undisclosed

Construction+continues+at+The+Flats%2C+set+to+open+in+the+fall.+July+14%2C+the+university+announced+it+was+moving+300+students+from+university-owned+Fairmount+Towers+to+privately+owned+The+Flats.+
Construction continues at The Flats, set to open in the fall. July 14, the university announced it was moving 300 students from university-owned Fairmount Towers to privately owned The Flats.

Construction continues at The Flats, set to open in the fall. July 14, the university announced it was moving 300 students from university-owned Fairmount Towers to privately owned The Flats.

Chance Swaim

Chance Swaim

Construction continues at The Flats, set to open in the fall. July 14, the university announced it was moving 300 students from university-owned Fairmount Towers to privately owned The Flats.

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The Kansas Board of Regents gave Wichita State the go-ahead to pay $1 million to a company partially owned by the chair of the board, but did not provide a copy of the full text of the agreement.

As part of a lease agreement between Wichita State and MWCB, the university will move more than 300 students from university-owned Fairmount Towers to The Flats, a new private apartment complex on Innovation Campus that was struggling to attract students.

July 20, Wichita State President John Bardo sent Nelda Henning, director of facilities for the board of regents, a request for approval of a lease with The Flats. That’s six days after the university announced the move.

That proposal was provided to The Sunflower and The Wichita Eagle.

But the approved agreement was different from the one proposed July 20.

Six days later, Wichita State submitted a different proposal to the board of regents, according to the letter of approval by the board’s president, Blake Flanders. His letter includes several revisions to the original proposal, but not the full terms of the agreement.

The Kansas Board of Regents denied The Sunflower’s request to obtain the full text of the agreement Tuesday.

“We believe it best for you to obtain the signed version,” Renee Burlingham, who handles records requests for the board of regents, said Tuesday in an email response to a record request.

Burlingham said the “final” version of the lease agreement is considered a draft until it is fully executed and signed by all parties, and therefore not subject to open records law.

Burlingham cited an exemption in the Kansas Open Records Act that allows public agencies, which the Kansas Board of Regents is, to deny records requests:

“Notes, preliminary drafts, research data in the process of analysis, unfunded grant proposals, memoranda, recommendations or other records in which opinions are expressed or policies or actions are proposed, except that this exemption shall not apply when such records are publicly cited or identified in an open meeting or in an agenda of an open meeting.”

Burlingham recommended getting the executed version of the agreement from Wichita State.

Burlingham’s counterpart at Wichita State, General Counsel David Moses, would not provide the unexecuted version of the agreement to The Sunflower Wednesday.

“Please see the KBOR response you received when you made the same request of KBOR,” Moses said.

Approval of the lease, which was required by regent policy before the university could proceed, came 17 days after Wichita State announced the move.

The Flats building is owned by MWCB, LLC. David Murfin, the chairman of the board of regents and one of the state’s most prominent businessmen, owns 25 percent of that company. Murfin’s company has been awarded contracts on Innovation Campus for The Flats, the Airbus Americas Building, a partnership building set to begin construction this summer, and a city-county law enforcement training center.

In February, Wichita State announced rates for The Flats. Rent prices as high as $939 a month and a combined cost of $1,000 for an application fee and deposit led to a swift student outcry. In May, the university announced new, slightly lower prices at The Flats, nine and 12-month lease options, a deposit reduced from $900 to $200, all-inclusive utilities, and offered the first 100 residents free reserved underground parking.

After two months of new rates, university management of occupancy at The Flats, and what Vice President of Research John Tomblin called an “advertising blitz,” which included $37,700 in marketing by the university, 48 students had signed up to live in The Flats. That is less than 20 percent of the 280 available beds.

Wichita State officials said after The Flats failed to fill to capacity, Murfin’s company was considering seeking an outside property manager to fill the rooms at The Flats, but decided, ultimately, that it wanted Wichita State Housing and Residence Life to manage the property.

Students who were moved from Fairmount Towers to The Flats will pay what they would have paid to stay in Fairmount Towers and will not be charged for the transfer, according to Flanders’s letter of approval.

The day the move was announced, Wichita State released an online FAQ page explaining the move. One of the questions was “Why wasn’t this announced sooner?” to which the university answered, “The decision was announced as soon as the details were finalized.”

The details were not finalized until Monday and — because the board of regents and Wichita State have denied The Sunflower’s requests for the full version of the unexecuted agreement — are not available to the public at this time.

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A full version of the regents’ approval letter can be found here.

4 Comments

4 Responses to “Regents approve WSU lease with regent’s private company, terms of agreement undisclosed”

  1. Transparency on August 2nd, 2017 11:28 am

    A public university not willing to share documents should tell people all they need to know. I love the KBOR comments using the word “fluidity” and statements about how innovation is hard to manage. Blake Flanders is appointed by KBOR and serves at their pleasure. Did anyone really think Flanders would not approve the agreement with his boss, David Murfin? Who would have thought a public university and students subsidizing wealthy developers would be innovative?

    I am sure we will get some great line from Fake President Bardo so that should be interesting.

    [Reply]

  2. Steve on August 2nd, 2017 1:14 pm

    The fix was in for this deal, the approval was never in doubt. Does anyone believe that this will just be a one year deal? What happens next year when the reduced rates for the Fairmount refugees disappear and the developer is dealing with an empty apartment building with rates that few students are willing to pay. I anticipate Bardo will innovate by altering the housing policies for undergrads to force more students to live on campus in the only building available that just so happens to be owned by a wealthy developer that serves on the Board of Regents. This is blatant corruption out in plain sight for all to see. Within the span of a few months, the story went from no WSU or public funds would be involved in this project to a more than 1 million dollar lease of an entire privately owned building. I hope the Sunflower stays on this story like a pitbull on a raw steak. Exposing this multi million fraud and misuse of public funds could be the scoop of a lifetime for a young journalist willing to dig and expose the truth.

    [Reply]

  3. Unexecuted? on August 2nd, 2017 4:38 pm

    The dates in the letter from Flanders state the lease starts August 1st. It is August 2nd. How can it be “unexecuted” and still a draft? If MWCB was only going to make $361,000 before WSU closed Fairmount and leased space and now MWCB will make $1,000,000 in base rent and several hundred thousand dollars more in “additional rent”, how are Murfin, Weigand, Crossland, and Barrett “losing their asses” as Andy Schlapp said they were in a previous interview?

    WSU in taking on all the cost to market the facility, manage the facility, and paying all the utilities. With the $1,500,000 they were to make at Fairmount Towers they would have paid the bond at $831,000 and other operating expenses and ultimately put some to the Housing reserve. What are the details of the amount each party will “net” in this lease agreement? People should get details and not blah, blah, blah.

    [Reply]

  4. Beth Clarkson on August 2nd, 2017 9:16 pm

    Awesome reporting! Thanks for letting the rest of us know about this.

    [Reply]

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