For almost a year, Kansas City, Kan., Police Chief Terry Zeigler has lived in a house owned by Wyandotte County in what is arguably the most beautiful part of the area.
But some say the arrangement is an ugly one for taxpayers — one that lacks transparency and misuses public property.
County residents, open government advocates and a Unified Government commissioner point to the fact that no written lease was in place for almost eight months after Zeigler moved into the house.
Zeigler pays little or no rent on a monthly basis because of credits granted for expenses to make improvements on the house.
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Officials put the lease in writing after a citizen inquired about it.
That such a deal was made out of public view raised red flags for Max Kautsch, a Lawrence-based attorney who is a board member at the Kansas Sunshine Coalition for Open Government.
“I think the main danger lies in the fact that it’s unclear how taxpayer money is being spent,” Kautsch said. “If there’s no way to track officially who is spending what and how income is coming in, then the taxpayers are at a severe disadvantage.”
Zeigler, however, said he doesn’t understand why there’s a controversy.
“People have verbal agreements all the time,” he said. “Obviously, I work for the Unified Government. I’m their employee. I’m not going to screw anybody over.”
The house was in bad shape, had been vacant for years and needed repairs that the Unified Government was unable to perform, Zeigler said.
The police chief said he spent his time and money to fix up the house, allowing the Unified Government to assess the value of the rent based on the improvements he made.
“Why is it a question if the agreement was to go in and fix it up and I did that?” Zeigler asked. He kept receipts, he said, and has some photos of the work.
“I guess handshakes aren’t always good enough for people,” he said.
The fact that Zeigler was living in the house became public after county resident Janice Witt heard about it from a county employee in June. She sent a public records request to the Unified Government in July, under the Kansas Open Records Act.
Soon after, Zeigler and County Administrator Doug Bach put a lease in writing. The lease for Lake House 1 at Wyandotte County was signed on Aug. 24 and made retroactive to Jan. 1.
In the lease, Zeigler agreed to pay $19,000 to rent the house for two years, starting from Jan. 1.
Although the lease was retroactive to the beginning of the year, Zeigler has yet to make a rent payment. Under the agreement, he is credited for expenses, labor and mileage he’s incurred while working on the house.
Because of the credits, Zeigler owes less than $1,300 in rent. From Dec. 29, 2017, through July 26, he has claimed more than $18,530 in expenses, including $672.53 in mileage and $5,765 in labor costs by him and others.
“I paid the rent in advance by doing the work and spending my own personal money on fixing it up,” Zeigler said. “So now when that credit runs out, I got to write a check to them by the end of the year. I’ll get them the last bit and I’m done for 2019. And in 2020, I have to start paying them $1,000 a month.”
Some of the labor credits included cleaning the house, for which he claimed 20 hours on Dec. 29 — for himself and his mother. He claimed another 8 hours the next day, again for cleaning by himself and his mother.
His mother has helped out on other projects at the house, too, according to Zeigler’s expense records. He declined to give his mother’s age, but Zeigler is 51.
Zeigler provided photos of some of the work, which included remodeling the kitchen, improvements to the back courtyard, and rebuilding the entrance.
Other key provisions of the lease:
▪ Zeigler’s rent is structured to increase as improvements are made to the house — $500 a month for the first six months, $800 for each of the next six months and $1,000 each month next year.
▪ No security deposit was required.
▪ Zeigler is credited $21.92 per hour for labor to improve the house.
▪ Electricity and water is paid for by the county.
▪ After two years, Zeigler can rent the house on a month-to-month basis with the county’s consent.
Zeigler said he did not think the lease was a “sweetheart” deal.
“I put money into it. I provided those receipts,” he said. “Those receipts were audited. They were accepted. And that was done in lieu of the UG fixing it up so they could turn around and rent it.”
Commissioner questions lease
Within days of the lease being signed on Aug. 24, Bach sent a letter to Unified Government Mayor David Alvey and the Board of Commissioners, notifying them he had rented the house to police chief.
In the memo, Bach said the two-bedroom house with dirt basement floor, which was built in the 1930s, was traditionally rented to a government employee.
“This house was in extremely poor condition and one we wanted to improve, however it was low on the priority of all the projects we needed to do,” Bach wrote.
Bach had told Zeigler the house was available late last year.
“From this discussion, we developed a written agreement, whereby the Chief could live in this house and make improvements to it from his own pocket,” Bach wrote. He pointed out that the front door was not in good working condition when Zeigler moved in.
“Expenses related to the improvement of the house are allowed as offsets to the monthly rent.”
However, Bach did not mention that the lease had been signed in August, after Zeigler had been living in the house for months.
Bach’s memo also didn’t mention other details of the lease, such as the hourly rate for labor, nor the fact that the county is paying for the electricity and water.
“This arrangement is working out quite well for both the Chief and our Park,” Bach wrote. “We now have an asset that is gaining value versus going the way of most vacant structures which ultimately have to be demolished.”
Unified Government Commissioner Ann Brandau-Murguia said she has not seen the lease. She said she first learned of the chief living at the house in mid-August, when she received a complaint from some residents.
“I reached out to Mr. Bach in person in mid-August,” Brandau-Murguia said in an email. “He informed me that he had the authority to make this decision without Commission approval.”
That’s when Bach offered to send the commissioners a letter notifying them of the lease. Brandau-Murguia said the legal department advised that the lease appears to be within Bach’s authority.
The timing of the lease signing, eight months after the agreement apparently was in effect, is troublesome, Brandau-Murguia said in a phone interview. The Unified Government traditionally requires that a lease be in place before possession is taken of a property.
“Though I have some concerns about how this arrangement developed and some terms of this agreement, this is an issue that requires more than one commissioner to take action,” she said.
Mayor David Alvey said in a written statement Friday that several residents brought him their concerns about the house.
Alvey said Bach and Zeigler entered into a “good-faith agreement” to renovate the house. He said he thought it was done ethically and in the best interests of the residents of Wyandotte County.
“It is my opinion that some individuals in our community continue to amplify this story in what seems to be an effort to discredit our County Administrator and our Police Chief, and they are doing so for their own political purposes,” Alvey said in the statement. “Wyandotte County deserves to be served by elected officials, staff and citizens who have higher purposes at heart and in mind.”
Other Unified Government commissioners, contacted by The Star, did not respond to questions about Zeigler’s lease.
Witt, the county resident who started asking about the house in July, has unsuccessfully run for mayor, most recently a year ago when she was defeated in the August primary. She is a financial services broker who runs a private food pantry.
In late November, Witt and her husband filed a lawsuit in Wyandotte County District Court, challenging Zeigler’s lease. The lawsuit calls it a “sweet deal” and says it was made “covertly” and “through cronyism and quid-pro-quo favoritism.”
In the lawsuit, the Witts asked that Zeigler and Bach, among others, be fired and that the contract be nullified.
They also asked that two independent appraisers or real estate professionals determine the value of the house and calculate a fair rent.
The Unified Government also has another house at the lake, near the marina, that has been rented out to a local couple for ten or more years.
Bach said he discovered that there wasn’t a written lease agreement in place for that property either, and one was drawn up about the same time as Chief Zeigler’s lease this summer.
KC also rents
Across the state line, Kansas City also rents some city-owned houses to employees.
But Kansas City requires that a written lease be in place before an employee moves into a city-owned home.
And it does not allow employees to do work on the houses in exchange for lower rent, a spokeswoman for the Kansas City Parks and Recreation Department said in an email.
The parks department owns five houses it rents to employees, according to the department’s director, Mark McHenry.
The employee renters are expected to look after the property and maintain the grounds, he said.
“We’re not going to be in the rental business. We’re not going to put people in these properties that are just someone that comes and knocks on our door,” McHenry said. “We want employees in there because they’re on the clock, too. These people are working. This is part of their job responsibility to take care of that property.”
He said it wasn’t a perk, but rather good property management and a way to prevent the homes from becoming a community liability. The department looks at market rate and the condition of the property when determining rents.
“People aren’t chasing us down to move in these houses,” McHenry said.