A federal grand jury is looking into loans made to Gov. Sam Brownback’s re-election campaign and has ordered the state’s ethics chief to testify next week as part of its investigation, according to a subpoena.
Carol Williams, executive director of the Kansas Governmental Ethics Commission, was summoned to appear before the grand jury Wednesday in Topeka, according to documents obtained through an open records request. She also was ordered to provide documents pertaining to loans Brownback’s campaign received in 2013 and 2014.
The subpoena doesn’t say which loans are being investigated, but the only loans listed on campaign disclosure reports for those years are one from Brownback himself and others from Lt. Gov. Jeff Colyer.
Colyer loaned Brownback’s campaign $500,000 in August – the third such loan the governor’s running mate made to their re-election bid – according to the last disclosure report, filed days before the November general election.
Such large loans by candidates to campaigns are uncommon in Kansas, and the pattern of repaying one within days is an unusual move that generated unanswered questions about where Colyer obtained such a large amount of cash.
Brownback’s campaign paid Colyer back $400,000 on Nov. 21, about two weeks after the election, according to the finance report filed with the Secretary of State’s office on Thursday. There is still $100,000 from the loan not yet repaid as of Dec. 31.
“The campaign followed all applicable laws and ethics regulations and this investigation has no merit,” Eileen Hawley, the governor’s spokeswoman, wrote in an e-mail. “It is a common practice for candidates to make loans to their campaigns and any loans were done in compliance with Kansas law and ethics regulations.
“The latest campaign financial report will be filed today and will clearly show those loans are in the process of being repaid.
“Governor Brownback’s focus is on doing the people’s work, preparing a budget and an agenda for the upcoming legislative session,” which begins next week.
The U.S. attorney’s office declined comment.
Brett Berry, general counsel for the ethics commission, released the document Thursday through the open records request, but otherwise declined comment. Williams also declined to comment.
Colyer said in August that the two $500,000 short-term loans he made to Brownback’s re-election campaign are examples of the good stewardship Kansas residents expect from government officials.
“It’s good money management, that’s all,” Colyer said at the time. “That’s what you’d expect for me to do with the state’s money, too, is to manage it well. We manage our campaign well – that’s it.”
Earlier finance reports indicate that Colyer, a reconstructive plastic surgeon, made his first $500,000 loan Dec. 31, 2013, the last day covered by a finance report due in early January 2014, and it was repaid Jan. 2, 2014.
He then made a second $500,000 loan July 23, 2014, the second-to-last day covered by a finance report due in late July. That loan was repaid two days later, when a new reporting period started.
The third $500,000 loan from Colyer was made Aug. 13. Brownback also loaned his campaign $200,000 during the last reporting period. Those are the only loans the Brownback campaign reported receiving in financial disclosure filings.
Colyer declined at that time to discuss other details about the loans, such as the source for them. He said the campaign didn’t keep his first loan because it wasn’t going to earn much interest.
Reporters also asked Brownback, after an unrelated statehouse news conference in August, whether he could explain the loans, and he declined.
“I’m not going to explain the thought process,” Brownback said at the time.
Democrat Paul Davis, who lost to Brownback in November, made the loans an issue on the campaign trail. Davis’ spokesman, Chris Pumpelly, said before the election that voters “deserve to know where this money came from.”
Senate Minority Leader Anthony Hensley, D-Topeka, called the subpoena “a dark cloud” that hovers over the administration less than a week before Brownback is inaugurated for a second term.
“Gov. Brownback and his people have a lot of explaining to do,” Hensley said in a statement Thursday. “The loans were clearly a tactic to deceive Kansas voters. My questions are, where did the money for the loans come from and were they made in accordance with state and federal law?”
“Hopefully the Grand Jury will find the answers the people of Kansas deserve to know,” he added.
Contributing: Bryan Lowry of The Eagle’s Topeka Bureau