City Hall surrender in Genesis-Steven Ice Center debacle casts doubt on competence | Opinion

If you can’t manage a $1 million project, how can you be trusted to manage an $810 million project?

That simple question arises from the announcement that the City of Wichita leans toward accepting a measly $200,000 from the Steven brothers, Rodney and Brandon, abandoning any hope of recovering repayment of the $1 million obligation from their Wichita Ice Center management contract.

The city’s lawsuit against the Stevens was scheduled to go to a jury trial later this month, but the city’s Law Department (assisted by private counsel) settled quietly, abandoning its claim to $2.6 million in unpaid debt and Ice Center damages occurring while the Genesis Health Clubs owners ran the city facility from 2011 to 2022.

City staff proposes to quietly approve the settlement on the consent agenda for Tuesday’s meeting. As a consent item, it would be passed en masse along with a list of other items deemed routine enough to require no public discussion.

In other words, the Council would sweep this messy business under the rug and press on with its effort to win public approval of an $810 million slush fund, to be paid for with a 1% sales tax on next March’s election ballot.

A portion of the $810 million plan is also on the agenda Tuesday, in a discussion of how to pay for a performing arts center.

Opponents to the sales tax likely will be on hand to remind the council of several past missteps that raise questions about its ability to oversee publicly funded projects.

The Ice Center debacle stands out on that list for one major reason. It wasn’t a single act of mismanagement and City Council incompetence. Instead, it is a serial offense, committed annually throughout the length of the 10-year contract with the Steven brothers.

It starts with the contract itself, which stipulated that delinquent payments could only be pursued for the most recent three years. That clause went unnoticed and undiscussed when the Council approved the contract in 2012.

So when the Steven brothers failed to meet any of the first three years’ payments, it would have been prudent of the city manager and council to file a collection action to protect those obligations from the three-year limitation.

And, the same prudent action would have been appropriate each and every year going forward, as the Steven brothers ignored their annual payment obligations.

The city finally filed a collection action in 2022 when it terminated the agreement, but could only pursue the last three years of non-payment.

Worse came to worst when the Steven brothers countersued, claiming the city was at fault for problems at the Ice Center.

In the end, the city’s Law Department tucked its tail between its legs and meekly acceded to the $200,000 settlement. And that amount will be reduced by the cost of outside legal counsel, which has yet to be disclosed and would be hidden in the consent agenda item.

Adding insult to injury, the city was obligated by the contract to pay the Steven brothers a total of $466,000 in management fees over the 10-year period.

The most troubling aspect of this whole fiasco is the City Council’s unwillingness to apologize to the taxpayers and accept responsibility for the failed oversight during the 10-year contract.

The $750,000 “loan” to the Steven brothers was funded by $760,466 bond issue taken out by the city at the start of the contract.

Each year’s payment on those bonds had to be borne by the taxpayer, as the city had to make good on the obligation in the absence of any payments by the Steven brothers.

If the City Council ever expects the public to approve the 1% sales tax in March, it must seek political redemption.

In the religious world, redemption is only possible by admitting sins and asking forgiveness. In the political world, failure to seek redemption should condemn the guilty parties to the damnation of public rejection.

Every council member since 2011, past and present, needs to shoulder blame and responsibility for this tragic loss of public money. It should start next Tuesday by pulling the item off the consent agenda and demanding answers from the administration staff.

— Dale Goter is a media consultant, former journalist and former state Capitol lobbyist for the city of Wichita.