City Has Financial Ties To NISTAC

Transcription

Priceless
Take One
T HURSDAY
VOLUME 18, N UMBER 4
T HURSDAY, J UNE 25, 2009
W INNER OF THE K ANSAS G AS S ERVICE
E XCELLENCE I N E DITORIAL W RITING
2006 K ANSAS P ROFESSIONAL
C OMMUNICATORS P HOTO E SSAY AWARD
2006 K ANSAS P ROFESSIONAL
C OMMUNICATORS E DITORIAL AWARD
W INNER OF THE K ANSAS P RESS
A SSOCIATION A DVERTISING AWARD
City Has Financial Ties To NISTAC
Over the past 18 to 20 years the
City of Manhattan and the
Manhattan Area Chamber of
Commerce have been deeply
involved with the National Institute
for Strategic Technology Acquisition
and Commercialization (NISTAC).
The auditor Grant Thornton LLP
hired by the Kansas Board of
Regents used eight pages of their
report on what could be problems at
NISTAC.
NISTAC (formerly the MidAmerica
Commercialization
Corporation), is a non-profit entity
aimed at commercialization activities and is a partnership between the
City, the State of Kansas (through
Kansas Technology Enterprise
Corporation), and Kansas State
University.
The City of Manhattan has just
completed a new 30,000 square foot
building and located on a lot owned
by Kansas State University at the KState Research Park to house
NISTAC.
The City is using the Economic
Development 1/2 cent Sales Tax to
pay for the $6.6 million structure.
The Manhattan Area Chamber of
Commerce assists the City of
Manhattan in in recruiting and
approving new business asking for
Sales Tax money.
One of the concerns of the auditors
is what could be a conflict of interest
of the people on the NISTAC Board
of Directors. There could be a conflict of interest with City Manager
Ron Fehr and Manhattan Area
Chamber of Commerce President
Lyle Butler being on the board. The
City has given money to NISTAC
over the years and now owns their
building.
Here is the report where it talks
about NISTAC:
NISTAC Cluster
Scope
Our work at the NISTAC Cluster
involved
interviewing
former
NISTAC Executive Chair Bob
Krause, NISTAC President Kent
Glasscock, and NISTAC Vice
President of Finance and Chief
Financial Officer Vicki Appelhans.
We reviewed financial statements
and general ledgers for NISTAC,
Mid-America
Technology
Management, Inc., (“MTM”) and
Manhattan
Holdings,
LLC
(“Holdings”) for fiscal years 2003
through 2008. In addition, we
reviewed the minutes of the Boards
of Directors for each entity for calendar years 2001 through 2008 and the
employment contracts and compensation agreements for Messrs.
Glasscock and Krause. We tested 22
cash disbursement transactions
greater than or equal to $500 if paid
to selected individuals (non-payroll)
or for select investments. This represented 99.6%, 42.6% and 100% of
the category for NISTAC, MTM and
Holdings, respectively. We also tested 105 other cash disbursements
(excluding payroll) greater than or
equal to $15,000. This represented
55.1%, 73.9% and 100% of the category for NISTAC, MTM and
Holdings, respectively.
Overview
The NISTAC Cluster consists of
the following related entities:
• NISTAC is a 501(c)(3)
Educational non-profit organization
whose mission is to create and sustain a formal network that will support technology advancement, technology transfer, education and 18
scientific research nationwide.
NISTAC’s objective is economic
development through facilitating the
commercialization of new technologies and the promotion of related
research and education.
Development and commercialization focuses on two distinct portfolios of patents: patents donated by
corporations
(Technology
Acquisition, Development and
Commercialization or “TADAC”),
and patents originating at KSU and
provided by the Kansas State
University Research Foundation
(“KSURF”). NISTAC commercializes both TADAC and KSURF
patents and provides administrative
services to startup companies licens-
Kent Glasscock, President of NISTAC denied the auditors access to the
NutriJoy Stockholders’ Agreement.
ing TADAC and KSURF patents, as which are barely more than a shell
well as laboratory and office space as with an annual Secretary of State filing. Two companies (NanoScale
needed.
• MTM is a for-profit entity and a Materials, Inc. and NutriJoy, Inc.)
wholly-owned
subsidiary
of have grown to the point of being
NISTAC. MTM provides manage- self-managed. Two other companies
ment, human resources and financial are repositories for groups of related
services to companies incubated by patents rather than multiple startups
NISTAC.
NISTAC
positions with single patents.
In addition to investments made by
(President, CFO etc.) are held by
the NISTAC Cluster, companies
employees leased from MTM.
• Holdings is an investment vehicle that provides seed capital funds
for startups being incubated by
NISTAC. Holdings is jointly owned
by the City of Manhattan, the
Foundation and the Kansas
Technology Enterprise Corporation
(“KTEC”) (2) in equal portions. The
University’s relationship to NISTAC
is through financial support and the
donation or transfer of intellectual
property to be commercialized incubated by NISTAC have access to
through incubated companies. a network of “Angel Investors” who
During the period under review, the are regularly given the opportunity to
University and its affiliated entities invest in startup companies under
have paid NISTAC between NISTAC’s management. In particu$200,000 and $830,000 per year for lar, it was noted that President
NISTAC’s role in acquiring, admin- Wefald, Mr. Krause and Mr. Krause’s
istering and protecting licensed tech- wife are investors in companies incunologies and intellectual property on bated by NISTAC.
Footnote
the University’s behalf for research
(2) KTEC is a private/public partand economic development. In addinership
established by the state of
tion, as previously mentioned, the
Kansas
to promote technology
Foundation is a one-third owner in
based
economic
development.
Holdings.
NISTAC is currently assisting sev- KTEC supports strategic research
eral startup companies, some of and development at NISTAC and
Bob Krause, NISTAC Executive Chairman
eight other Business Assistance
Incubators throughout the state.
KTEC also provides support
through two state-wide networks.
Each site has a specific focus and
provides a set of services including
everything from shared lab space to
access to investment capital for
early-stage companies. KTEC supports NISTAC through grants and
is also an owner/investor in
See the complete Kansas
State University Audit at:
manhattanfreepress.com
City Manager is on the NISTAC Board of Directors
Holdings. Our work did not involve
any analysis of KTEC information
or data.
Until his resignation on September
3, 2008, Mr. Krause held various
positions within the NISTAC
Cluster.
Mr. Krause was the University’s
representative to NISTAC, the
Chairman of NISTAC, a board member of MTM , and a member of
Holdings’ Advisory Board during the
period under review. Due to the
amount of time he was spending on
non-University related NISTAC
business, he was appointed
Executive Chair of NISTAC and
given a 15% fractional employment
contract in 2006. (3) His compensation as NISTAC Executive Chair was
all placed into a deferred compensation plan and was paid out in January
of 2009, subsequent to his resignation from NISTAC, MTM and
Holdings. Mr. Krause was eligible
for bonuses, both cash and equity in
startup companies invested in by
NISTAC. However, upon his resignation, Mr. Krause declined to take
receipt of any equity awards due
him.
Conflict of Interest
A conflict of interest occurs
when an individual or organization has an interest that might
compromise their objectivity and
reliability. A conflict of interest
exists even if no improper acts
result from it, and can create an
appearance of impropriety that
can undermine confidence in the
conflicted individual or organization. Such a conflict exists relative
to the NISTAC Cluster as directors
of NISTAC and its affiliated entities are permitted to hold stock in
and serve as directors/officers of
investee companies. This can call
into question their decision-making in situations such as that
involving NutriJoy as described
below.
NutriJoy, Inc.
NutriJoy was jointly founded by
Kansas State President Jon Wefald
NISTAC and KSURF in 2000 to
develop and commercialize nutritional technologies donated to
NISTAC by The Procter & Gamble
Company and technologies derived
separately from research within
KSU. NutriJoy’s two main brands,
Calc-C® and Goodbites™, are based
upon the donated technologies.
NISTAC and its affiliate companies
hold significant ownership in
NutriJoy largely via NISTAC’s
licensing of intellectual property to
NutriJoy and the conversion of loans
into equity. Under the original terms
of the License Agreements between
NISTAC and NutriJoy, NISTAC
received an annual license maintenance fee and royalties on licensed
product sales by either NutriJoy or
its sublicensees.
Since 2000, NutriJoy has been
supported in part through a network
of loans and/or equity investments
by NISTAC, MTM, Holdings and
KSURF. In addition, NutriJoy has
been invested in by Angel Investors,
including President Wefald, Mr.
Krause, and Mr. Glasscock. (4)
Reportedly, Mr. Krause and
President Wefald invested in
NutriJoy in 2002 purchasing 37,500
and 35,000 shares, respectively, with
cash at the $1 per share stated par
value.
Footnote
(3) In fiscal year 2007, Mr.
Krause was a 15% employee of
NISTAC/MTM per his contract with
those entities and a 90% employee
with the University as Vice
President
for
Institutional
Advancement. His total contracted
time totaled 105%.
(4) NISTAC declined to identify
other “Angel Investors” due to confidentiality concerns. However, it
was verbally indicated that only Dr.
Wefald and Mr. Krause were the
only “Angel Investors” that were
employed by the University or any
of its affiliates.
Per the License Agreements
between NISTAC and NutriJoy, in
the event NutriJoy becomes insolvent or otherwise ceases business
operations, all technology rights
revert back to NISTAC. Given that
the value of NutriJoy is largely vested in the intellectual property it controls, such a reversion of the patents
could strip NutriJoy of its revenue
generating assets, preventing a
recovery of cash investments by
NutriJoy’s
stockholders.
This
became of concern to some of
NutriJoy’s stockholders in the Spring
of 2005. NutriJoy was experiencing
cash flow difficulties that threatened
its existence while it was pursuing a
strategic partnership with a large
food or beverage company. One of
the transactions being considered at
that time was the acquisition of
NutriJoy’s underlying intellectual
property by the strategic partner.
Under that scenario, NISTAC alone
could agree to sell and assign the
underlying patent rights away from
NutriJoy, effectively rendering
NutriJoy’s stock worthless.
Given its cash flow difficulties in
2005, NutriJoy sought to raise additional equity funds to enable it to
continue operating and to attempt to
complete the transaction with the
proposed strategic partner. The
Boards of NISTAC and MTM agreed
to convert their collective $200,000
in outstanding loans to NutriJoy to
equity investments subject to the
contingency of an additional
$200,000 being raised from existing
stockholders. Other key stockholders, who had the financial wherewithal to match the investment,
made their additional investments
contingent upon the receipt of assurances from NISTAC that cash
investors in NutriJoy would not be
disadvantaged relative to NISTAC in
any future realization of capital
returns from the technologies
licensed to NutriJoy. Therefore, in a
Resolution in Lieu of Meeting dated
April 21, 2005, the Executive
Committee of NISTAC (chaired by
Mr. Krause who was also a cash
investor in NutriJoy) recommended
that “Any future capital, non-royalty
financial returns arising from the sale
See page 8
NEWS
2A
MANHATTAN FREE PRESS - THURSDAY, JUNE 25, 2009
Obituaries
George Marchin
George L. Marchin, age 68, of
Manhattan, Kansas, died unexpectedly Friday morning, June 19th,
2009,
in
his
home.
He was born on July 12,1940, in
Kansas City, KS, son of George
Leonard and Ann (Hanis) Marchin.
Dr. Marchin graduated from Bishop
Ward High School and attended
Rockhurst University. In 1967 he
earned his Ph.D at University of
Kansas School of Medicine. He
completed post-doctoral studies at
Purdue University before making his
home in Manhattan in 1970.
He was united in marriage to Anne
Parkinson on July 20, 1974 in
Manhattan, Kansas. They raised five
children:
Melissa,
Katherine,
Madelaine, Marjorie and George. He
was a devoted husband and father.
Dr. Marchin has been a Manhattan
Wanetta Mencl
Wanetta I. Mencl, age 48, of
Manhattan, Kansas, died Friday,
June 19, 2009, at the Mercy Regional
Health Center in Manhattan.
She was born on February 2, 1961,
in Manhattan, Kansas, the daughter
of William Ellis and Opal Blazer.
Mrs. Mencl was a lifetime area
resident where she was a homemaker. She enjoyed camping, fishing
and spending time with her family.
On May 7, 1994, in Ogden,
Kansas, she was united in marriage
to Thomas E. “Tom” Mencl. He sur-
Betty Phares
Betty L. Phares, age 83, of Manhattan,
Kansas died Friday morning, June 19,
2009, at the Mercy Regional Health
Center in Manhattan.
She was born on June 17, 1926, in
Columbus, Ohio the daughter of William
and Ethel Marie (Coffman) Knost. Mrs.
Phares was raised in Columbus where
she graduated from high school.
Mrs. Phares worked as a Dental
Assistant at the V.A. Hospital in
Columbus, Ohio where she met her
future husband, E. Jerry Phares. They
Tina Olson
Augustine (Tina) Josephine Dizman
Olson, 85, of Manhattan died June 21,
2009, at St. Joseph Village in Manhattan.
Tina was born in Krasnodar, Caucasus,
Russia to Joseph and Marie Dizman
March 14, 1924. Two and half years
later her sister Olga Josephine arrived.
Tina’s family owned a shipping line on
the Black Sea and a very large flour mill;
all was lost during the revolution to the
communists. Summers would find her
family vacationing at the Black Sea at
their villa; a villa the communists took
for a sanitarium. The world was changing; most of the family was sent off to
Siberia.
The Great Depression,
Communists and the rise of right wing
groups convinced Tina’s father to flee
Russia in the summer of 1942 to see if
life could be better elsewhere; just before
Tina was to start college in Moscow to
become a doctor.
Augustine (Tina) married Odin
Chester Olson (Bud) three times (Army
Chaplain, German Burgermester, and at a
Russian Greek Orthodox Church) in
Munich, Germany, December 24th, 1947
– Christmas Eve. Tina’s husband Bud (a
bomber pilot) was able to arrange to have
her wedding gown made out of a parachute.
Tina’s with her new husband Bud, her
sister Olga and her husband Philip
“Hank” Ankrom (Bud’s best friend) and
parents Joseph and Marie Dizman found
their new life in the United States. Tina
and Bud were married for 48 years
before Bud passed away July 7th, 1995.
Tina was a military wife for 32 years,
taught Russian at Fort Riley in her early
years of marriage; she spoke five languages. For over 25 years Tina worked
at College Avenue United Methodist
Church nursery.
Tina loved being around her family,
friends, and neighbors; she was a very
active woman. Tina continued her love
of swimming by attending exercises at
KS University with her aerobic buddies.
She enjoyed being involved with College
Avenue United Methodist Church and
Christian Woman’s Club. Monthly she
gathered with a group of friends for a
birthday luncheon.
Tina loved her dogs; Tasha was her
latest dog; her companion who she loved
to take for walks. Tina loved to watch
squirrels and birds enjoying sunflower
seeds she would leave for them.
Tina was preceded in death by her
parents Joseph and Marie Dizman of
Hollywood, CA., husband Odin Olson,
Sr. of Manhattan, and one sister Olga
Ankrom of N. Hills, Calif.
Survivors include her children Mary
and Ronald Pauli of Manhattan, Clara
and Michael Smith of Riley, and Odin
and Annemarie Olson Jr. of Manhattan.
Tina’s grandchildren are William Douthit
and his wife Nicole, Katharina Olson and
one great grandson Coleman Douthit and
extended family are granddaughter
Fatima Stengel and great grandson David
Noel Stengel Hutzenlaub of Germany.
She is also survived by her sister Olga
resident for 38 years. He was a professor of Microbiology at Kansas
State University and had planned to
retire soon. He taught many biology
courses, his research was published
in numerous journals, and he also
edited textbooks and encyclopedias
on science. He was a member of the
American Society of Microbiology.
Through scientific contribution,
teaching and his kindness, he
touched
many
lives.
He was a member of St. Thomas
More Catholic Church where he
taught CCD for many years. He
enjoyed racing sailboats in his youth
and was a member of the Blue Valley
Yacht Club in recent years. He was
an assistant Scout Master for Troop
74 and hiked Philmont with his son.
He loved running, sailing, camping,
research, and playing the accordion.
He enjoyed traveling. He went on
a year long Sabbatical to Sweden in
1978 with his family. Through his
work he traveled in Asia, including
Korea, the Philippines and Hong
Kong. In recent years he traveled to
Spain with his family and most
recently toured Mexico and Peru. He
made friends wherever he went in
life.
Survivors include his wife Anne
of the home, 4 daughters, Melissa
Perchellet and her husband, Antoine
of Shawnee, KS, Katherine MarchinTomlin and her husband Ed of
Mission, KS, Madelaine Gogol and
her husband Peter of Prairie Village,
KS, Marjorie Marchin and 1 son:
George Marchin who both currently
attend the University of Kansas. He
is survived by 2 granddaughters:
Lucie Perchellet and Clementine
Gogol; 2 brothers John Marchin of
Shawnee, KS and Larry Marchin of
Kansas City, KS and a large extended family and many friends.
vives of the home. Also surviving
are two daughters: Chyan Mencl of
Manhattan, Sheila Huffman of St.
George, Kansas, three sons:
Deondrey Ellis of Charlotte, North
Carolina, Dusty Ellis and James
Ellis, both of Manhattan, three brothers: Carl, Bill and James Ellis all of
Manhattan and one sister: Connie
Loftus of Shenandoah, Iowa. She is
also survived by three granddaughters and two grandsons.
Mrs. Mencl was preceded in death
by her parents and by one sister, Cara
Robinson.
Memorial services will be held
2:00 p.m. Friday, June 26, 2009, at
the
Yorgensen-Meloan-Londeen
Funeral Chapel with Doris Compton
presiding. Cremation is planned.
On-line condolences may be left
for the family through the funeral
home website located at www.ymlfuneralhome.com.
Memorials may be made to the
National Multiple Sclerosis Society.
Contributions may be left in care of
the
Funeral Home, 1616 Poyntz Avenue,
Manhattan, Kansas 66502.
were united in marriage in Columbus on
August 7, 1955.
They moved to Manhattan, Kansas in
1955 where Betty was a homemaker and
her husband was on the faculty of the
Psychology Department at Kansas State
University and Department Head from
1967-1991.
Mrs. Phares was active politically with
the Democratic Party and for many years
was a poll worker for Riley County on
local, state and national Election Days.
She was a past member of the KSU
Social Club and the League of Women
Voters. She and her husband, Jerry, sup-
ported the Marianna Kistler Beach
Museum of Art, McCain Performance
Series, and the Sunset Zoological Park,
all of Manhattan.
She is survived by her daughter, Lisa
Phares Richards of Manhattan, Kansas
and by two grandchildren: Andrea Fuller
and her husband Jeremy of Salina,
Kansas and Jared Richards of Manhattan.
She is also survived by a niece, LeeDee
Stevens of Grey Forest, Texas.
Mrs. Phares was preceded in death by
her parents, husband, and one sister:
Edith Miller.
The family received friends during a
visitation from Tuesday evening, June
23, 2009, at the Yorgensen-MeloanLondeen Funeral Home.
Private graveside services were held in
the Sunrise Cemetery.
On-line condolences may be left for
the family through the funeral home
website located at www.ymlfuneralhome.com.A memorial has been established for the Sheltering Embrace
Hospice House. Contributions may be
left in care of the Yorgensen-MeloanLondeen Funeral Home, 1616 Poyntz
Avenue, Manhattan, Kansas 66502.
Ankrom’s three children Phil Ankrom of
Simi Valley, CA., Richard Ankrom of
Maricopa, AZ and her namesake Tina
Stabile Frein of Northridge, CA. and
their families; three sister-in-laws,
Regina Pribyl of Milan, Ill., Geraldine
Sunlin of Moline, Ill., and Madeline
Lumpkin of Forsyth, MO. and their families.
Funeral services will be held at 10:30
A.M. Tuesday, June 30th, at the College
Avenue United Methodist Church in
Manhattan, with Reverend Larry Fry
officiating. Private family interment will
be in Fort Riley Cemetery.
The family of Mrs. Olson will receive
friends from 6:00 until 8:00 P.M.
Monday, June 29th, at the YorgensenMeloan-Londeen Funeral Home.
On-line condolences may be left for
the family through the funeral home Web
site, www.ymlfuneralhome.com.
Mass of Christian Burial will be at
10:00 a.m. on Thursday, June 25,
2009 at St. Thomas More Catholic
Church with Father Don Zimmerman
officiating and Father Loren Werth
as Concelebrant. Burial will be
Thursday afternoon in Kansas City.
The family will receive friends
from 5:30 until 7:00 on Wednesday
with vigil service at 7:00 pm at the
Yorgensen-Meloan-Londeen Funeral
Home 1616 Poyntz Ave., Manhattan,
KS.
Memorial Contributions may be
made in his name for a scholarship to
be named later and left in care of
Home 1616 Poyntz Ave., Manhattan,
KS.
On line condolences may be left
for the family through the funeral
home website at www.ymlfuneralhome.com.
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NEWS
3A
Now That’s Rural
Kansas Profile: First Trust Company of Onaga
By Ron Wilson, director of the
Huck Boyd National Institute for
Rural Development at Kansas
State University.
Dollars and cents. Managing our
money is very important, both now
and for the future. Today we´ll go to
a rural community with an innovative company that enables individuals all across the country to manage
their own retirement funds.
Meet Jean Meyer, President of
First Trust Company of Onaga,
Kansas.
First Trust Company is a limited
purpose trust company with a specialty in serving as custodian for
self-directed individual retirement
accounts, or IRAs.
Jean explains that this innovative
business began back in 1978 on a
golf course. She says, "The owner of
a local bank and another guy were
talking about IRAs, which were relatively new at the time, and the possibilities of using non-traditional
investments as part of those." In
other words, it would be possible to
purchase in the IRA, special assets
such as an investment in a private
business, loan, or something else,
rather than a money market account
or public stocks and bonds.
The bank set up a service to serve
as a custodian for such accounts.
A key factor was that these
accounts were self-directed by the
customer. Jean says, "The customer
Ron Wilson
is the decision maker on these
accounts. We don´t sell investments.
We don´t offer investment advice,
and we don´t guarantee the investments. We do the back office work to
support the customer."
This service began with one or two
people working at the bank, and the
account records were kept in a drawer. As the business grew, the trust
company was organized into a separate entity.
In 2006, First Trust
Company moved into its own building - fittingly, it is located near the
community´s nine-hole golf course.
In 2008, First Trust Company of
Onaga moved under new ownership.
Today, First Trust Company of
Onaga employs 34 full time and
three part-time employees. It provides custodial services for some
27,000 accounts with two billion
dollars under custody. Wow. Yes, I
said two billion - with a B as in "Boy,
that´s a lot of money."
This business has successfully
found its niche. There are only a
handful of businesses across the
nation that specialize in custodial
services for self-directed IRAs using
non-traditional investments.
The business is regulated by the
state banking commissioner.
Jean Meyer is especially proud of
the company´s customer service. In
contrast to the days when those
records were stuck in a drawer, the
company is now imaging its documents and customers have access to
their accounts through a secure website.
In addition, the company operates
a call center to serve customers.
Jean says, "Depending on what´s
happening in the markets, we may
get 250 to 600 phone calls in a day."
While the company uses modern
technology, Jean emphasizes the
importance of customer service. In
other words, you don´t have to press
one or press two twenty times to
reach a real person.
Modern technology has made it
possible to serve customers virtually
anywhere in the nation. Jean says,
"It´s very rare that a customer would
walk in our front door." In effect, if I
can access my account information
online and by phone, it doesn´t matter whether I am physically located
across the street or across the country.
Sure enough, customers from all
across the country are using this
service. First Trust Company of
Onaga has customers in every state
in the nation, serving them from the
rural community of Onaga, Kansas,
population 697 people. Now, that´s
rural.
First Trust Company also emphasizes giving back to the community
of Onaga. The employees are
involved in community activities and
donate funds to support local worthy
causes.
For more information, go to
www.ftconaga.com.
Dollars and cents. Today we´ve
learned about a company which is
providing custodial services for customers to manage their self-directed
investments in an innovative way.
We salute all the people of First Trust
Company of Onaga for making a difference by finding this niche in
financial services. For helping customers keep track of those dollars,
this business makes a lot of sense.
And there´s more. Next week
we´ll learn about amazing volunteers
in Onaga.
Fisher Mudjacking, Inc.
Mudjacking, Foundation Repair & Waterproofing
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Topeka: 785-246-2023
Manhattan: 785-539-1986
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Obituaries
Nancy Williams
Nancy May Williams, age 81, of
Manhattan, passed away June 23,
2009, at her residence, after a
lengthy battle with cancer.
She was born February 8, 1928, in
Bala, Kansas, the daughter of Walter
O. and May L. (Woodbury) Jenkins.
Mrs. Williams graduated from
Kansas State University in 1975 with
her Bachelor of Science in Social
Work. Following her graduation she
worked as a Social Worker for the
State of Kansas Social and
Rehabilitation Services.
She was a member of St. Thomas
More Catholic Church, Lone
Wrangler’s Square Dance Club,
Manhattan Welcome Club and the
Riley County Seniors’ Service
Center.
On August 13, 1946, in Riley,
Kansas, she was married to Harlan
H. Williams. Mr. Williams preceded
her in death on June 29, 1980. She
was also preceded in death by one
brother, Harry H. Jenkins, and one
sister, Lola Ann Schlaegel.
Survivors include her five children: Teresa Anderson of Paulden,
AZ, Valorie Johnson of Manhattan,
Steve Williams and his wife Adria, of
Tulsa, OK, Dana Williams and his
wife Marjorie of Alma, KS, and
Bradly Williams and his wife Karen
of McPherson, KS; one sister, Hazel
Reed of Colorado Springs, CO; one
brother, Leland Jenkins of Castro
Valley, CA; five grandchildren and
four great-grandchildren.
Funeral services will be held at
10:00 A.M. Saturday at the
Chapel with Father Don Zimmerman
officiating. Interment will follow in
the St. Patrick’s Cemetery in Ogden.
The family of Mrs. Williams will
receive friends from 7:00 until 8:00
P.M. Friday at the YorgensenMeloan-Londeen Funeral Home.
Online condolences may be left for
the family through the funeral home
website
at
www.ymlfuneralhome.com.
Memorial contributions may be
made to Homecare & Hospice, Inc.
Contributions may be left in care of
the
Funeral Home, 1616 Poyntz Avenue,
Manhattan, KS 66502.
Scouts: Healthy Lifestyle
Girls typically are less physically
active than boys, but a Kansas State
University researcher has found that
organizations like Girl Scouts provide an
ideal setting to get girls moving early in
life and to develop lifelong healthy
habits.
Richard Rosenkranz, assistant professor in human nutrition at K-State, did a
study using interventions with Girl Scout
troops. He trained group leaders to
instruct exercise sessions and promote
healthful eating, and in effect taught the
girls about a healthy lifestyle and
increased their participation in exercise
activities.
"We were striving to get the girls and
parents to spend some of their leisure
time together being active and taking
steps together for fun and health," he
said.
Rosenkranz worked with 10- and 11year-old girls who were members of Girl
Scout troops in Manhattan and the sur-
rounding area. The two-year study
involved nine troops, with five of the
troops receiving an intervention.
"What we saw in the control troops
was an environment where girls were
sedentary for the vast majority of time at
the meeting, combined with snacks that
were less than health-promoting," he
said. "This is just one part of a girl's
weekly or bi-weekly experience, but it
offers the chance to provide an opportunity and a message for health promotion."
Rosenkranz trained the group leaders
as part of the intervention. They learned
about the background of intervention
activities, which included nutrition, family meals, physical activity and family
connection. They also were taught the
expectations of being role models and
providing a healthful environment at Girl
Scout meetings, as well as new physically active games for the girls.
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EDITORIAL
4A
Thoughts from the Prairie
Home, Home on the Range
By Dick Miller
One of the great delights about living out here on the Prairie is walking
outside on a clear night and gazing
into the star-filled heavens. The Big
Dipper is always there rotating
around the North Star. Now where is
Orion The Hunter tonight, and
Hercules with his big family of 19
constellations? For a moment I transcend the chaos of the day and rest in
the assurance that I know the Star
Thrower and in the assurance that
regardless of what happens tomorrow, I will find the North Star in the
same place tomorrow night.
It used to be that here on the Range
there was “seldom a discouraging
word,” but like passing through a
meteor shower, we are encountering
philosophical debris that is bombarding our culture and pocking our surface with distressing craters. One of
those globs is nationalized healthcare. This proposed legislation is
about controlling, it is not about caring. A society patting itself on the
back for exiting the morass of slavery by the last election is poised to
plunge the entire population into a
different kind of slavery. American
poet Ezra Pound observed, “Wars in
old times were made to get slaves.
The modern implement of imposing
slavery is debt.” The answer to
healthcare is personal responsibility,
not irresponsible debt from a failed
system.
We have just extolled the blessings
of Fatherhood and would do well to
heed the advice of Thomas Paine,
Common Sense, 1776, that is as
fresh as the prairie after the rain: “As
parents, we can have no joy, knowing that this government is not sufficiently lasting to ensure any thing
which we may bequeath to posterity:
And by a plain method of argument,
as we are running the next generation
into debt, we ought to do the work of
it, otherwise we use them meanly
and pitifully. In order to discover the
line of our duty rightly, we should
take our children in our hand, and fix
our station a few years farther into
life; that eminence will present a
prospect, which a few present fears
and prejudices conceal from our
sight.”
The Hate Crime Bill is another
glob of space junk that is in reality a
free thought inhibiter that has nothing to do with justice. It is designed
to stamp out moral debate, a futile
attempt to silence the naturally
imbedded conscience by eliminating
a conscious reminder of behavior
opposed to the natural order. Charles
Colson,
Founder
of
Prison
Fellowship Ministries, recently told
leaders of a major denomination he
“predicts pastors will soon face prosecution under hate crimes laws if
they preach that same-sex relationships are sinful.” He also said medical professionals are losing their
conscience right to refuse to perform
abortions, and faith-based ministries
could soon have to hire non-believers.
Congressman Louie Gohmert, in
an article in Human Events, pointed
out the absolute absurdity of this
Hate Crimes legislation as written,
“which would warrant the prosecu-
tion of a woman under the federal
hate crimes statutes if she hits a
flasher with her purse after he
exposed
himself
to
her.
Exhibitionism is a protected sexual
orientation under this bill. ‘The one
who did the flashing committed a
local misdemeanor,’ Gohmert said.
‘The one who hit with the purse singled him out because he’s an exhibitionist, and therefore she has now
committed a federal hate crime and
is looking at felony time.’”
It is incredible that such legislation
as these two bills could even be
imagined in a nation that has been
the “City on a Hill.” It is even more
incredible that legislation so destructive to personal liberty could be
occurring in Washington, DC, while
our warriors are fighting and dying
in the sweltering desert heat in Iraq
and Afghanistan to protect our liberty. If these bills are enacted, they will
be the final two nails in the coffin of
a culture whose epitaph once was,
“Give me liberty or give me death!”
The luxury of just enjoying our
“Home on the Range” that was
passed on to us by the sacrifice of
our ancestors is no longer an option
if we are to survive the cultural meteoric debris. We must get involved;
study the issues, write our representatives! An option for those desiring
a more active role is to participate in
local tea parties or a Washington,
DC, tea party in September!
Socialism will not go away; it must
be driven away! General Stark’s
challenge to “Live free or die!”
means we have a choice. If we do not
vigilantly live as a free people, our
"Conscience of Kansas"
Experience, Judgment, and
Character: The Road from
Eisenhower to Obama
By Paul Ibbetson
I recently found myself in the childhood home of Dwight D. Eisenhower in
Abilene, Kansas. It was a tremendous
experience to hear the creek of the floorboards, to see the handcrafted furniture,
and to feel the texture of the wallpaper
(even though that is probably against the
rules for visitors) in the boyhood home of
one of the most important historical figures of the United States. They say that
the Eisenhowers lived on the wrong side
of the tracks, but you can’t tell that today.
What you can tell, is that the Eisenhower
family home was not a place of extravagant frills, but of family necessity, with a
delicate dash of austere country beauty.
It was from my visit to Abilene,
Kansas, that I thought myself bold
enough to compare the man they called
“Ike” to the newest sensation on the presidential stage, Barack Obama. Some
would say that it is not fair to make the
comparison of these two presidents and
that the list of reasons might possibly
reach infinity - and to some degree that’s
a valid argument. However, there are
some situations in the country now facing Obama that are very similar to those
which were faced by Eisenhower that
had defined him as a leader. That is, the
current threats to the national security of
the United States, and the manner in
which the President is dealing with them.
Let’s throw political parties to the side
and talk about what really matters in the
crunch from a leader: experience, judgment, and character.
The United States is once again faced
with a foe that desires our total destruc-
tion. This time the foe is radical Islamic
extremists, and it is here that we see a
tremendous separation between the experience, judgment, and character, of
Barack Obama and that of Dwight D.
Eisenhower. Barack Obama seems all too
willing to talk to our enemies about
America’s wrongdoings, and then
appears to be overly restrained when
freedom-seeking people challenge those
same totalitarian regimes. If the same situation of election violence that has
recently taken place in Iran were to have
befallen Eisenhower, would we see the
same vague and flaccid statements of
condemnation that have sprung forth
from the lips of Obama? I seriously
doubt it. In fact, if we are honest,
Eisenhower had probably made more
clutch decisions before becoming
President than Barack Obama or most
people have had to make in their entire
life.
This is not to say that Eisenhower was
a war hawk, because that would be far
from the truth. Eisenhower had the same
distaste for war that entails most soldiers,
but he had a keen eye for sizing up the
enemy. He had celebrated abilities that
are entrusted to a special few that bear
the burden of momentous decisions that
will affect the nation, where failure is not
an option. It was this kind of tested judgment, combined with Eisenhower’s internal character, which placed him in the
historical
position
of
Supreme
Commander of Allied Forces in World
War II. With a humble grace, Eisenhower
shined in this harsh war environment
with its extreme pressures that require
not only experience and good judgment,
but also the strength of character that
comes from knowing the righteousness
of freedom, and the rightness of America.
It is in this arena that Eisenhower
excelled and that, I believe, Obama will
fail us. As Barack Obama spends his precious time talking about the challenges of
the day by noting the shortcomings of the
past administration, Eisenhower went to
work. As Obama rubs shoulders with
Hollywood elites and runs the late night
talk show circuit, Eisenhower addressed
the bottom line needs of the country. As
Obama triples the country’s debt and
nationalizes the free market system,
Eisenhower gave us economic prosperity
after the bloodiest of wars.
There is no doubt that Obama would
win an oratory flare contest against the
thirty-fourth President of the United
States, and would most likely come off
more flamboyant after an evening of chit
chat with Jay Leno or David Letterman;
but when it comes to substance, and a
leader for troubled times, I still like Ike.
Paul A. Ibbetson is a former Chief of
Police of Cherryvale, Kansas, and member of the Montgomery County Drug
Task Force. Paul received his Bachelor’s
and Master’s degree in Criminal Justice
at Wichita State University, and is currently completing his PhD. in sociology
at Kansas State University. Paul is the
author of the books Living Under The
Patriot Act: Educating A Society and
Feeding
Lions:
Sharing
The
Conservative Philosophy In A Politically
Hostile World. Paul is also the radio host
of the Kansas Broadcasting Association’s
2008 and 2009 Entertainment Program
of the Year, Conscience of Kansas airing
on KSDB Manhattan 91.9 FM. For interviews or questions, please contact
[email protected] or go to
www.IbbetsonUSA.com.
Dissecting The Kennedy Bill
By Betsy McCaughey
Committee to Reduce Infection Deaths
Last September Sen. Barack Obama
promised that under his health-care proposal “you’ll be able to get the same kind
of coverage that members of Congress
give themselves.” On Monday, President
Obama repeated that promise in a speech
to the American Medical Association. It’s
not true.
The president is barnstorming the
nation, urging swift approval of legislation that is taking shape in Congress.
This legislation — the Affordable Health
Choices Act that’s being drafted by Sen.
Edward Kennedy’s staff and the Health,
Education, Labor and Pensions
Committee — will push Americans into
stingy insurance plans with tight, HMOstyle controls. It specifically exempts
members of Congress (along with federal employees; the exemptions are in section 3116 , p. 114).
Members of Congress “enjoy the
widest selection of health plans in the
country,” according to the U.S. Office of
Personnel Management. They “can
choose from among consumer-driven
and high deductible plans that offer catastrophic risk protection with higher
deductibles, health saving/reimbursable
accounts and lower premiums, or fee-forservice (FFS) plans, and their preferred
provider organizations (PPO), or health
maintenance organizations (HMO).”
These choices would be nice for all of us,
but they’re not in the offing. Instead, if
you don’t enroll in a “qualified” health
plan and submit proof of enrollment to
the federal government, you’ll be tracked
down and fined (sections 3101, p.
104 and section 6055, pp. 107-110).
For a health plan to count as “quali-
fied,” it has to meet all the restrictions
listed in the legislation and whatever criteria the Secretary of Health and Human
Services imposes after the bill becomes
law. You may think you’re in a “qualified” plan, but the language suggests that
only plans with managed-care controls
such as the “medical home” will meet the
definition (sections 3101 and 2707).
“Medical home” is this decade’s version of HMO-style insurance, according
to the Congressional Budget Office, with
a primary-care provider to manage your
access to costly services such as visits to
specialists and diagnostic tests. Medical
home providers in “qualified” plans,
states the Kennedy bill, will have a “payment structure” based on “incentives”
rather than payments for each doctor visit
or procedure (section 3101, pp. 57-58).
These requirements are reminiscent of
the unpopular controls HMOs imposed
two decades ago that caused public outrage and led to state laws reining in abuses. In December 2008, a Congressional
Budget Office report evaluating early
drafts of major federal health insurance
proposals noted that “medical homes”
were likely to resemble the HMO gatekeepers of 20 years ago if cost control is
a priority.
That report specifically referred to a
payment incentive called the “withhold.”
When HMOs became dominant in the
early 1990s, they would withhold 10% or
more of physicians’ fees until the end of
the year and give it back only to the
physicians who met targets for limiting
how many referrals to specialists or diagnostic tests their patients used.
The targets were so stringent that, if
they were exceeded, what a doctor prescribed for you came out of your doctor’s
own pocket at the end of the year. This
set up a conflict of interest between you
and your doctor.
Mr. Obama tried to put a positive spin
on such cost controls in his June 13
weekly radio address. He said “if doctors
have incentives to provide the best care,
instead of more care, we can help
Americans avoid unnecessary hospital
stays, treatments and tests that drive up
costs.” Fair enough — if you want your
doctor paid to police your care and to be
financially penalized for that extra test or
referral you get.
It is reasonable to require that people
who accept a government subsidy for
health insurance tolerate cost controls to
protect taxpayers. But according to the
terms of the Kennedy bill, you must
enroll in a “qualified” plan or face a fine,
even if you and your employer are paying the entire cost of the plan you already
have (section 161, pp. 111-115).
The president has promised that if you
like your plan you can keep it. Kennedy’s
bill says that too. It’s doubletalk, as the
consequences of nonenrollment make
clear. How big a fine will you face? The
bill doesn’t specify or set a limit. It says
the fine will be enough to “accomplish
the goal of enhancing participation in
qualifying coverage” (section 161, p.
104).
If legislation similar to the Kennedy
bill lands on Mr. Obama’s desk, he has an
obligation to keep his promises to the
American people and veto it. And whatever health-insurance law is passed
should apply to members of Congress. If
it isn’t good enough for them, it shouldn’t be imposed on the rest of us.
Ms. McCaughey is chairman of the
Committee to Reduce Infection Deaths
and a former lieutenant governor of New
York State.
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whether we should have a government without
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newspapers without a government,
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Mailing Address:
P.O. Box 1191, Manhattan, Ks 66505
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[email protected] or [email protected]
785-537-8953
MINUTES
City Commission Minutes
MINUTES
CITY COMMISSION MEETING
TUESDAY, JUNE 2, 2009
7:00 P.M.
The Regular Meeting of the City
Commission was held at 7:00 p.m. in
the City Commission Room. Mayor
Bob Strawn and Commissioners
Bruce Snead, James E. Sherow,
Loren J. Pepperd, and Jayme MorrisHardeman were present. Also present
were the City Manager Ron R. Fehr,
Assistant City Manager Jason
Hilgers, Assistant City Manager
Lauren Palmer, City Attorney Bill
Frost, City Clerk Gary S. Fees, 8
staff, and approximately 18 interested
citizens.
PROCLAMATION
Mayor Strawn proclaimed June 6,
2009, D-Day Remembrance Day.
Matthew Pennell, Mrs. Matthew
Pennell, Sam Reniker, and Dick
Miller were present to receive the
proclamation.
CONSENT AGENDA
(* denotes those items discussed)
MINUTES
The Commission approved the
minutes of the Regular City
Commission Meeting held Tuesday,
May 19, 2009.
CLAIMS REGISTER NO. 2613
The Commission approved Claims
Register No. 2613 authorizing and
approving the payment of claims
from May 13, 2009, to May 26, 2009,
in the amount of $2,386,495.08.
LICENSES
The Commission approved an
annual Cereal Malt Beverage License
for Valentino’s of Manhattan, 3003
Anderson Avenue, Suite 901, and a
4th of July Fireworks Display for
Dara’s Fast Lane, 1115 West Port
Road.
ORDINANCE NO. 6761 – LEVY
SALES TAXES – CITY PARK,
CICO,AND
NORTHVIEW
POOLS AND SUNSET ZOO EDUCATION BUILDING
The
Commission
approved
Ordinance No. 6761 levying a .10%
sales tax to reconstruct the current
swimming pool located in City Park,
Ordinance No. 6762 levying a .10%
sales tax to reconstruct the swimming
pools located in Northview and CICO
Parks, and, Ordinance No. 6763 levying a .05% sales tax to construct an
education building at Sunset Zoo.
ORDINANCE NO. 6764 – NO
PARKING – FAIR LANE (SOUTH
DELAWARE
AVENUE
TO
SOUTH MANHATTAN AVENUE)
Bud Valerius, 1849 Fairchild
Avenue, inquired about the no parking item on Fair Lane and asked what
affects it would have on those properties.
Ron Fehr, City Manager, provided
additional information on the item
and responded to questions regarding
the no parking zone being proposed.
The
Commission
approved
Ordinance No. 6764 removing parking along Fair Lane from South
Delaware
Avenue
to
South
Manhattan Avenue.
PUBLIC HEARING – VACATE
PEDESTRIAN EASEMENT –
GRAND MERE VILLAGE ADDITION
Mayor Strawn opened the public
hearing. Hearing no comments,
Mayor Strawn closed the public hearing.
The Commission approved first
reading of an ordinance vacating a
portion of the pedestrian easement
located in Tract A along Lot 4, Grand
Mere Village Addition.
FIRST READING – RENAME –
VANESTA PLACE AND MARKET PLACE TO CLOCK
TOWER PLACE
The Commission approved first
reading of an ordinance renaming
Vanesta Place and Market Place,
located in Tract C, Grand Mere
Village Addition, to Clock Tower
Place, as requested by the developer.
* AWARD CONTRACT – DEMOLITION OF CITY-OWNED
PROPERTY – SOUTH REDE-
5A
VELOPMENT
DISTRICT
(SP0904)
Jason Hilgers, Assistant City
Manager/Redevelopment
Coordinator,
provided
the
Commission with an overview of the
demolition of City-owned property in
the South Redevelopment District.
He then responded to questions from
the Commission regarding the timeline, dust, noise, seeding, and signage
related to the redevelopment project.
Brad Everett, representing Fairfield
Inn, asked that during the demolition
work on the South Redevelopment
District, to be sensitive to those individuals that live nearby or who are
sleeping at the Fairfield Inn as it
relates to dust and noise.
Coordinator, stated that the City has a
good relationship with the contractor
and will work with the Fairfield Inn
and others to mitigate any issues. He
said that they do not anticipate any
weekend work on the project.
The Commission awarded a contract in the amount of $370,070.00 to
G & GDozer, of Caney, Kansas, for
demolition of City-owned property in
the South Redevelopment District
(SP0904).
AWARD CONTRACT - WILDCAT RIDGE SANITARY SEWER
REPAIR (SS0906)
The Commission awarded a contract in the amount of $25,500.00 to
Larson Construction, of Manhattan,
Kansas, to replace 300’ of sanitary
sewer main at the Wildcat Ridge
Development.
WORK AUTHORIZATION NO.
3 – AIRPORT TERMINAL
IMPROVEMENTS (AP0901)
The Commission authorized the
Mayor and City Clerk to execute
Work Authorization No. 3 with HWS
Consulting
Group,
Inc.,
of
Manhattan, Kansas, in the amount of
$27,500.00 for Airport Terminal
Improvements (AP0901), contingent
on concurrence from American Eagle
Airlines, Inc.
BOARD APPOINTMENTS
The
Commission
approved
appointments by Mayor Strawn to
various boards and committees of the
City.
City/University Special Projects
Fund Committee Re-appointment of
Jo Brunner, 304 South Delaware, to a
two-year Citizen term. Ms. Brunner’s
term will begin July 1, 2009, and will
expire June 30, 2011.
Re-appointment of Eileen Meyer,
2429 Buena Vista Drive, to a twoyear Citizen term. Ms. Meyer’s term
will begin July 1, 2009, and will
expire June 30, 2011.
Appointment
of
Jonathan
Mahorney, 2335 Grandview Terrace,
to a two-year Citizen term. Mr.
Mahorney’s term will begin July 1,
2009, and will expire June 30, 2011.
Code Appeals Advisory Board
Re-appointment of Pat Cox, 7228
Deer Trail Road, to a three-year
Engineer term. Mr. Cox’s term begins
immediately, and will expire May 31,
2012.
Re-appointment of Todd Olson,
629 Pecan Circle, to a three-year
Electrician term. Mr. Olson’s term
begins immediately, and will expire
May 31, 2012.
Appointment of Tony Reid, 8962
Green Valley Drive, to a three-year
Master Plumber term. Mr. Reid’s
term begins immediately, and will
expire May 31, 2012.
Housing Appeals Board
Re-appointment of Gene Wiley,
1900 Kenmar, to a three-year term.
Mr. Wiley’s term will begin July 1,
2009, and will expire June 30, 2012.
Re-appointment of Tim Trubey,
2920 Hickory Court, to a three-year
term. Mr. Trubey’s term will begin
July 1, 2009, and will expire June 30,
2012.
Parks And Recreation Advisory Board
Appointment of Stacy Mackey,
1616 Humboldt Street, to fill the
remainder of the unexpired term of
Reed Scott and a four-year term. Ms.
Mackey’s term begins immediately,
and will expire June 30, 2013.
After discussion, Commissioner
Sherow moved to approve the consent
agenda,
as
presented.
Commissioner Snead seconded the
motion. On a roll call vote, motion
carried 5-0.
GENERAL AGENDA
FIRST READING – INCREASE TRANSIENT GUEST TAX
Bernie Hayen, Director of Finance,
presented the item.
Ron Fehr, City Manager, responded to questions from the Commission
regarding the proposed increased
transient guest tax and how the additional funds would be applied to the
South Redevelopment District. Bill
Frost, City Attorney, provided clarification on the proposed charter ordinance and the process to adopt a charter ordinance.
Coordinator, responded to questions
from the Commission regarding the
timeline to adopt a charter ordinance
and the process to approve first and
second readings of an ordinance to
levy this tax. He then responded to
additional questions regarding the use
of the transient guest tax.
Ron Fehr, City Manager, and
Bernie Hayen, Director of Finance,
responded to questions about the
cities listed as comparisons in the
staff memorandum.
Karen
Hibbard,
Director,
Manhattan Convention and Visitors
Bureau, provided additional information to the Commission regarding the
need for additional meeting space and
stated that rarely do meeting planners
ask what amount is the transient guest
tax. She then answered additional
questions from the Commission
regarding the acceptable range for a
transient guest tax given the collective properties that Manhattan has to
market.
Ron Fehr, City Manager, provided
additional information about the proposed use and hours of the Discovery
Center, Conference Center, and
Warren Theatres components and
opportunity for these facilities to
complement each other.
Karen
Hibbard,
Director,
Manhattan Convention and Visitors
Bureau, responded to additional
questions from the Commission
regarding what groups come and do
not come to our city now due to size
limitations, number of available
rooms, and recent and historic occupancy rates for Manhattan.
Janet Paxton, General Manager,
Holiday Inn at the Campus, voiced
opposition to the proposed two percent (2%) increase in the transient
guest tax and provided additional
information to the Commission on
their business and price sensitivity of
their customers.
She suggested that the Commission
consider a hamburger tax, as done in
bigger cities and responded to questions from the Commission.
Brad Everett, General Manager,
Fairfield
Inn,
informed
the
Commission that the Manhattan
Convention & Visitors Bureau (CVB)
Steering Committee met to discuss
the proposed increase in the transient
guest tax and voted to recommend
that the Commission direct $72,000
of the Airport funds collected from
the transient guest tax be returned
back to the Manhattan CVB for the
Discovery Center, as well as to
increase the transient guest tax by one
percent (1%) for collecting the necessary funds for the Discovery Center.
He then responded to questions from
the Commission.
Coordinator, and Ron Fehr, City
Manager, responded to questions
pledge to the Airport for these funds
and use of economic development
funds to assist with future improvements to the Airport terminal to
accommodate new regional jet service with American Eagle Airlines.
Brad Everett, General Manager,
Fairfield
Inn,
informed
the
Commission that occupancy rates
have softened and reiterated that the
CVB Steering Committee has
approved a one percent (1%) increase
in the transient guest tax. He voiced
concern that the market needs
to remain competitive and to not
overprice ourselves.
After discussion, Commissioner
Snead moved to approve first reading
of a Charter Ordinance authorizing
the levy of a transient guest tax, at a
rate not to exceed seven percent
(7%), upon the gross receipts derived
from or paid by transient guests for
sleeping accommodations.
Commissioner Sherow seconded
the motion. On a roll call vote,
motion carried 5-0.
2009 CHAMBER OF COMMERCE MID-YEAR REPORT
Lauren Palmer, Assistant City
Manager, introduced the item.
Lyle Butler, President/Chief
Executive Officer (CEO), Manhattan
Area Chamber of Commerce, outlined the presentation and introduced
members representing the Chamber
of Commerce.
Karen
Hibbard,
Director,
Manhattan Area Convention and
Visitors Bureau, presented a mid-year
presentation on activities associated
with the Convention and Visitors
Bureau and provided an update on
conventions, leisure tourism, sports
marketing, special events, occupancy
trends, and transient guest tax information.
Lyle Butler, President/CEO,
Commerce, responded to questions
proposed visitor’s center near
Interstate.
Mayor Strawn requested that the
Chamber of Commerce assist in the
marketing efforts associated with
downtown redevelopment on the
Chamber’s web site.
from the Commission and informed
the Commission that Varney and
Associates, CPA, LLC, does their
annual audit and if there are any
financial questions, to contact him or
Varney’s directly.
John
Pagen,
Vice
President–Economic Development,
Commerce, presented an overview to
the Commission on workforce development, economic growth, and
Market Manhattan campaign.
Bevin Landrum, Military Relations
Manager, Manhattan Area Chamber
of Commerce, provided an update on
the activities and highlights associated with Fort Riley and local military
related operations.
from the Commission related to job
creation, the local unemployment
rate, and wages. He stated that the
Chamber, with the assistance from
Don Wissman and others, will soon
be re-evaluating the current economic development model used for economic development prospects.
The Commission took a brief
recess.
EXECUTIVE SESSION
At 10:15 p.m., Commissioner
Snead moved to recess into Executive
Session until 10:45 p.m. for the purpose of discussing matters related to
employer-employee
negotiations
with Local 2275, International
Association of Fire Fighters, the
union representing certain members
of the Manhattan Fire Department.
Commissioner Sherow seconded the
motion.
On vote, motion carried 5-0.
At 10:45 p.m., the Commission
reconvened with Mayor Strawn, and
Commissioners Snead, Sherow,
Pepperd, and Morris-Hardeman in
attendance. Commissioner Snead
moved to recess into Executive
Session until 11:00 p.m. for the purpose of discussing matters related to
employer-employee
negotiations
with Local 2275, International
Association of Fire Fighters, the
union representing certain members
of the Manhattan Fire Department.
Commissioner Sherow seconded the
motion. On vote, motion carried 5-0.
At 11:00 p.m., the Commission
reconvened with Mayor Strawn, and
Commissioners Snead, Sherow,
Pepperd, and Morris-Hardeman in
attendance.
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MINUTES
County Commission Minutes
The Board of County
Commissioners
Of Riley County, Kansas
The Regular meeting of the Board of
County Commissioners met at the
Riley County Plaza East Building June
11, 2009 with the following members
present: Alvan Johnson, Chair; Mike
Kearns, Vice Chair; Karen McCulloh,
Member; and Rich Vargo, County
Clerk.
8:30 Public Comment & Business
Meeting
Joyce Mermis, KMAN; Clancy
Holeman, Counselor/Director of
Administrative
Services;
Leon
Hobson,
Director
of
Public
Works/County Engineer; Johnette
Shepek, Budget and Finance Officer;
Cindy Volanti, Human Resource
Manager; Debra Regester, Register of
Deeds; Rod Meredith, Assistant
Director of Public Works/Parks
Director; and Craig Cox, Assistant
County Counselor, attended.
Volanti said we are under a hiring
freeze, but the Public Works
Department has requested to hire an
engineering intern, which is a paid
position.
Hobson said it will help with the
imaging project.
Vargo stated he is considering
requesting hiring a temporary worker
to assist with imaging in the Clerk and
Elections departments. Vargo stated
the temporary positions are budgeted
for as well.
Volanti stated we need to clarify that
the hiring freeze does apply to temporary positions as well.
Kearns said he could not support the
temporary hire with the hiring freeze in
affect. He believes it would be different for essential positions.
Hobson said June Schittker, Steve
Springer, and Scott Sewell were elected to the Konza Advisory Board.
Hobson discussed a Notice of Intent
to prepare an environmental assessment for the operations specifications
change for initiation of commercial
regional jet service at the Manhattan
Kansas Regional Airport from
Landrum & Brown, asking if Riley
County has any concerns regarding the
analysis that will be undertaken in the
environmental assessment.
The
Board
of
County
Commissioners suggested Hobson
reply by e-mail that there is no impact
to Riley County.
Johnson stated a Riley City Council
member expressed concern with the
speed limit on Winkler Road and
Winkler Mills Road.
Johnson said the tornado siren in
Randolph is at the old fire station and a
citizen complained that he cannot hear
it on the other side of town.
Johnson discussed the Regional
Council meeting on June 18, 2009.
Johnson said Doris the City Clerk of
Riley and a resident said most of the
tubes off Kansas Avenue are obstructed.
McCulloh said Ron Harms requested meeting with him to discuss the
Wildcat Creek drainage.
Kearns said Paul Miller contacted
him about the Barnes Road overlay.
Hobson said the Public Works staff
is addressing the issue.
9:00 Johnette Shepek, Budget and
Finance Officer
Administrative
Services;
Leon
Hobson,
Director
of
Public
Works/County
Engineer;
Rod
Meredith, Assistant Director of Public
Works/Parks
Director;
Dennis
Peterson, Director of Noxious Weed;
Will Klusener, Manhattan Mercury;
Eileen King, Treasurer; Larry
Couchman, Director of EMS; and
Craig Cox, Assistant County
Counselor, attended.
Shepek discussed the CIP fund and
6A
projects.
Shepek discussed the formation of a
Public Building Commission (PBC) to
fund large building projects such as the
LEC expansion to free up cash for
equipment and smaller projects.
Johnson expressed concern with the
formation of a PBC.
Kearns said he is not adverse at
studying the use of a PBC.
Johnson said he would support looking at a limited list of projects to take
before the voters.
Johnson said the commission has
been on record for years as wanting to
save the cash to pay for the LEC
expansion and feels now is not the time
to change directions.
McCulloh said she does not like
going into debt, but now with low
interest rates and the talk of inflation
now may be the time to issue debt.
McCulloh stated debt should be used
for only long-term life projects.
Johnson said we need to discuss
funding of the Lowery case as well.
Kearns said he needs to hear from
the departments on the CIP projects
that are critically in need of being
done, the costs associated with them,
and the best way to approach funding
the projects.
Peterson presented a list of equipment needs for the Noxious Weed
department.
Johnson recommended a CIP work
session to discussed department needs.
Johnson suggested Road and Bridge
projects be pulled out and be addressed
in a new ½ cent sales tax bond issue.
9:40 Eileen King, Treasurer
Administrative Services; Johnette
Rod Meredith, Assistant Director of
Public Works/Parks Director; and Will
Klusener, Manhattan Mercury, attended.
King presented monthly revenue
reports.
9:51 Clancy Holeman, Counselor/
Director of Administrative Services
Administrative Work Session
9:51 Kearns moved that the County
Commission recess into executive session pursuant to the preliminary discussions relating to the acquisition of
real property exception to the Kansas
Open Meetings Act, in order to discuss
an initial offer of purchase by the county, the open meeting to resume in the
County Commission Chambers at
10:01 a.m. McCulloh seconded.
Carried 3-0.
10:01 Kearns moved to go out of
executive session. Johnson seconded.
Carried 3-0.
No binding action was taken during
the executive session.
10:01 Kearns moved that the County
Commission recess into executive session pursuant to the non-elected personnel matters exception to the Kansas
Open Meetings Act, in order to discuss
a performance matter involving a
county employee and to protect the privacy of the employee, the open meeting to resume in the County
Commission Chambers at 10:15 a.m.
McCulloh seconded. Carried 3-0.
10:15 Kearns moved to go out of
executive session. Johnson seconded.
Carried 3-0.
No binding action was taken during
the executive session.
10:20 Dale Hawley, North Central
Flint Hills Area Agency on Aging and
Tom Finney
Johnette Shepek, Budget and
Finance Officer; Craig Cox, Assistant
County Counselor; and Anne Smith,
aTa Bus Director, attended.
Finney presented the North Central
Flint Hills Area Agency on Aging 2010
appropriation request.
10:30 Jennifer Wilson, County
Extension Director and Fair Board
Finance Officer; Debra Regester,
Register of Deeds; and Cindy Casper,
Fair Board Member, attended.
Wilson presented the Riley County
Fair 2010 budget request.
Kearns moved to sign a License
Agreement for locations for periodic
blood drives with American Red
Cross. McCulloh seconded. Carried 30.
Kearns moved to sign a Sales
Agreement
with
Professional
Ambulance for three ambulances in the
amount of $514,964.00. McCulloh
seconded. Carried 3-0.
Kearns moved to approve a Renewal
of Online Access Agreement with
Charlson and Wilson Bonded
Abstracters for the Register of Deeds’
Office. McCulloh seconded. Carried 30.
Alpha Title, LLC for the Register of
Deeds’ Office. McCulloh seconded.
Carried 3-0.
Riley County Genealogical Society for
the Register of Deeds’ Office.
Kearns moved to authorize the Chair
to sign a letter to Senator Pat Roberts
to request assistance in “breaking
through” a bureaucratic “logjam” in
the Manhattan, Kansas office of the
USDA currently administering the
“American
Recovery
and
Reinvestment Act Rural Development
Grants.” McCulloh seconded. Carried
3-0.
Cox discussed the Journal Entry and
Settlement Agreement with Louis and
Shirley Abernathy.
Kearns moved to sign a Journal
Entry and Settlement Agreement with
Louis and Shirley Abernathy.
Kearns moved to approve the minutes of June 8, 2009 as amended.
10:50 Department Heads 2010
Budget Request
Eileen King, Treasurer; Johnette
Shilo Heger, Tax & Accounting
Supervisor/Deputy Treasurer; Debra
Regester, Register of Deeds; Joyce
Mermis, KMAN; and Julie Winter,
Office Manager, attended.
King presented the Treasurer’s
Office 2010 budget request.
Winter presented the Benefit
Districts 2010 budget request.
Regester presented the Register of
Deeds’ Office 2010 budget request.
11:25 Recessed for lunch.
1:15 Larry Couchman, Director of
EMS
Anne Smith, aTa Bus Director; and
Johnette Shepek, Budget and Finance
Officer, attended.
Couchman presented the Ambulance
2010 budget request.
1:39 Anne Smith, aTa Bus Director
Finance Office; and Leon Hobson,
Director of Public Works/County
Engineer, attended.
Smith discussed the 2010 Social
Services Advisory Board funding
request. Smith said the Riley County
aTa Bus cannot operate fixed routes
without City funding.
The commission discussed transitioning the aTa bus service to a public
transit fixed route system.
1:51 Leon Hobson, Director of
Public Works/County Engineer
Finance Officer; Clancy Holeman,
Counselor/Director of Administrative
Services; and Rod Meredith, Assistant
Director of Public Works/Parks
Director, attended.
Meredith discussed cleaning services for the numerous county buildings.
Meredith said he met with Holmes
Cleaning Services and they recommended some changes.
Meredith said with the proposed
changes the annual cleaning cost
would be $48,848.00.
The
Board
of
County
Commissioners, by consensus, agreed
to the Holmes Cleaning Services, Inc.
revised annual cleaning agreement in
the amount of $48,848.00.
The
Board
of
County
Commissioners asked Hobson and
Meredith to meet with Holeman to
draft a one page agreement with
Holmes Cleaning Services, Inc.
Hobson discussed using the
Qualification Base Selection process
for the design of the boiler and cooling
tower. Hobson said he would like to
proceed with a Request for
Qualifications for the boiler and cooling tower.
Johnson said the commission will
rely heavily on staff to evaluate the
rates paid.
Hobson estimated the engineering
cost to be approximately $15,000.00 $20,000.00.
The
Board
of
County
Commissioners, by consensus, agreed
to implement a Qualification Based
selection process for the design of the
boiler and cooling tower of the
Courthouse will require a learning
curve for staff. However, staff believes
this is a better selection process and
would recommend Riley County utilize the Qualification Based selection
process for the design of the boiler and
cooling tower project. Following this
selection staff will evaluate the process
and make a recommendation to the
Commission for future professional
services selections.
2:00 Johnette Shepek, Budget and
Finance Officer
Shepek presented the 2010 Board of
County
Commissioners
budget
request.
The
Board
of
County
Commissioners agreed to freeze their
2010 salary at the same level as 2009.
Shepek presented the County
Coroners 2010 budget request.
Shepek presented the 2010 Riley
County Police Department fund budget request.
Shepek suggested budgeting a 1.4%
delinquency rate.
Shepek presented the 2010 Bond &
Interest fund budget request.
Shepek presented the summary of
the ½ cent sales tax projects and 2010
budget request.
Shepek presented the 2010
Economic Development fund budget
request.
3:17 McCulloh moved to adjourn.
Kearns seconded. Carried 3-0.
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New KSU Guide To Help
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By Katie Mayes
KSU News Serivce
For some first-year students, the
transition from high school to college life can be difficult.
To help incoming students cope
with those challenges, Kansas State
University is launching the GPS -- or
Guide to Personal Success -- program.
The program, based on one with
the same name offered at George
Washington University, provides
incoming students with a stronger
connection to campus by matching
them with a mentor.
K-State first started thinking about
the experiences of incoming students
and how they might impact retention
a few years ago, according to Emily
Lehning, assistant vice president for
student life. A task force then investigated ways to create a unified firstyear experience for students.
"K-State offers many programs
and services for new students,"
Lehning said. "Our group is always
looking for creative, low-cost ways
to help more students be successful
in the critical first year of college."
The first step, taken in the 20082009 school year, was the introduction of first-year seminars. The seminars are capped at 22 students and
provide interactive learning that is
connected to campus events and
activities outside of class. The purpose of the seminars, as well as other
student retention efforts on campus,
is to make sure students get more
individualized attention and are connected to campus, thus increasing the
chances of success.
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students with a faculty or staff guide.
"These guides will know campus
resources inside and out so they can
ensure students are getting the support they need to help them succeed," Tedford said.
At a minimum, mentors and
mentees will meet three times in the
fall and twice in the spring, though
more frequent communication via email and phone will likely take place,
Tedford said.
Tedford also said that in the first
year of the program, faculty mentors
and students will not be matched
based on academic discipline
because program organizers want
new students to be exposed to a variety of majors and programs on campus. Guides also will not serve as
academic advisers, but rather as an
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NEWS
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City Has Financial Ties To NISTAC ____from page one
and assignments of intellectual
properties, now licensed from
NISTAC to NutriJoy, are allocated
first to repay cash investments by
stockholders if a normal proportional
allocation of such returns, according
to stockholdings held by each, are
insufficient to do so.” The
Resolution would specifically apply
to any transaction within three years
of the date of the Resolution.
The recommended allocation of
proceeds would postpone any financial returns to NISTAC on its noncash (received in lieu of licensing
fees or royalties) investments in
NutriJoy until all cash-based
investors had a return of their $1 per
share par value. Allowing the cash
investors to receive a return of capital first would allay investors’ fears
and contribute to NISTAC’s stated
purpose of promoting investment in
the startup companies. The
Resolution was presented to and
approved by the full NISTAC Board
of Directors at their May 17, 2005
meeting. The Executive Committee
Resolution does not address whether
or not members holding a cash
investment in NutriJoy, such as Mr.
Krause and Mr. Glasscock, recused
themselves from this action.
However, the NISTAC Board minutes note that directors who personally supported NutriJoy in executive
or financial capacities abstained
from voting on the Board’s approval
of the Resolution.
Further, at the same May 17, 2005
meeting of NISTAC’s Board of
Directors, the Executive Committee
sought approval to make “quick and
binding decisions involving a possible sale of intellectual properties and
rights held by NISTAC and licensed
to NutriJoy.” The reasoning behind
this request was that NutriJoy was
currently engaged in highly confidential and sensitive discussions that
could possibly lead to an “urgent
need” for NISTAC to make such
decisions without sufficient time for
Board approval. Reportedly, the then
Chairman of NISTAC and NutriJoy,
Dr. Ron Sampson, was at odds with
the remainder of the NutriJoy Board
regarding the possible strategic partnerships. This led to the NISTAC
Board creating an “Augmented
Executive Committee” apart from
the existing Executive Committee,
for the purpose of making decisions
in the NutriJoy situation only. The
members of the “Augmented
Executive Committee” were specifically chosen because they had no
personal interest or involvement with
NutriJoy. Three of the five Executive
Committee members, Messrs.
Sampson, Krause and Glasscock,
had personal interest in NutriJoy
through their board position at
NutriJoy and/or personal ownership
of NutriJoy stock. It appears that the
Board was attempting to address the
conflict of interest on the Executive
Committee by the creation of the
“Augmented Executive Committee.”
However, NutriJoy was not successful in obtaining a significant strategic
partnership at that time, and the
Augmented Executive Committee
was disbanded.
Due to NutriJoy’s continued need
for cash infusions to support operations,
NISTAC’s
Executive
Committee approved an additional
investment in NutriJoy in January
2006. In conjunction with that
investment and the planned phased
retirement of Dr. Sampson from the
NISTAC and NutriJoy Boards,
NISTAC’s Executive Committee
“strongly encouraged the NutriJoy
Board to invite the Chair of the
NISTAC Board, Mr. Krause, to join
their Board.” Mr. Krause was subsequently appointed Chairman of
NutriJoy’s Board.
Under Mr. Krause’s leadership and
with his significant personal involvement, NutriJoy successfully pursued
a significant strategic partnership
with Coca-Cola. In August 2007,
NISTAC’s Executive Committee discussed and reaffirmed the April 2005
Resolution that would result in
NISTAC not receiving a financial
return on its 843,750 NutriJoy shares
acquired via licensing or other services in advance of capital recovery of
other stockholders. Additionally, the
Executive
Committee
stated
NISTAC’s willingness to negotiate
to eliminate its ongoing royalty
requirement in order to facilitate a
sale of stock. Messrs. Krause and
Glasscock were authorized by the
Executive Committee to negotiate
with NutriJoy, on behalf of NISTAC,
a capitalized future return for eliminating its royalty requirement. It
appears from the NISTAC Board
minutes that the binding decision
with regard to the Coca-Cola transaction was made by the five member
Executive Committee, inclusive of
Messrs. Krause and Glasscock.
In late January 2008, Coca-Cola
acquired a majority interest in
NutriJoy. As a result NutriJoy Class
A (cash) stockholders received a
cash distribution of approximately
68¢ per share accounted for as a
return of capital.
We were told that under the terms
of the NutriJoy Stockholders’
Agreement, Class A stockholders
must receive $1.00 for their shares
before any distributions are paid to
other classes of stockholders. Class
A stockholders receiving cash distributions include, but are not limited to
NISTAC, Holdings, KSURF, MTM,
the Robert Steven Krause Revocable
Trust dated 5/16/03, Kenton L.
Glasscock Trust dated 6/1/01, and
Jon and Ruth Ann Wefald. NISTAC
received a cash distribution of
$375,725.26 on the 550,315
NutriJoy Class A shares, but not on
the 843,750 Class B shares it had
acquired in relation to the donation
of the intellectual property.
In addition to giving up the cash
distribution on its Class B shares,
NISTAC also gave up on-going compensation due from NutriJoy and its
sublicensees under the 2000 License
Agreement related to the annual
license maintenance fees; all royalty
payments due from NutriJoy, its
affiliates and sublicensees; and all
non-royalty sublicensee payments.
Compensation to NISTAC is now
addressed in the January 2, 2008
Second Amendment to License
Agreement which reads “The parties
agree that NISTAC is entitled to certain contingent payments in
exchange for the rights granted by it
in this Agreement. The contingent
payment amounts, if any, are as
described in Section 2.4 of the
Stockholders
Agreement
for
NutriJoy, Inc. dated of even date
KSU Expert Preparing Communities
For Social Cost Of Expanded Gambling
As state-owned casinos come to
Kansas, they bring both the promise of
increased revenue for the state and the
potential for more social problems for
communities.
“We’re talking about something that
affects everybody in Kansas,” said
Esther Maddux, Kansas State University
professor of personal financial planning.
Maddux is joining Jean Holthaus from
the Kansas Department of Social and
Rehabilitation Services to educate
Kansans about the social costs of problem gambling. Both have training and
experience helping people deal with
problem gambling. They are facilitating
a K-State class Aug. 4 and 5 in Dodge
City to help the community prepare for a
casino coming to the town. More information on the class is available at
http://tinyurl.com/qfgsg7
Local facilitators are Debbie Snapp,
executive director of Catholic Social
Services for Dodge City, and Ethel
Schneweis, Ford County Extension
director.
Maddux and Holthaus first offered the
course in January in Topeka. The class
gives Kansans an overview of prevention, responsible gambling, treatment,
recovery, legislative issues, financial and
legal aspects of gambling and how problem gambling will impact individuals,
families and communities.
Maddux brings her expertise in the
intersection of personal behaviors and
personal financial planning. Her work
involves helping people see how their
behavior affects the way they handle
money while motivating them to change
those behaviors to successfully manage
their finances. She is working on a book
on the topic.
“Cash flow, net worth and debt management inventories are an expression of
how people organize their behaviors
around their use of money,” Maddux
said. “Once they see the behaviors creating the problems, they can start the correction process. If you string enough
days with the new behavior together, you
will ultimately see it expressed in reducing deficits on debt inventory and net
worth statements.”
According to Maddux and Holthaus,
people from many sectors of Kansas
communities have a stake in expanded
gaming, particularly because state law
legislates that 2 percent of revenues from
casinos go toward gambling and addiction recovery. That’s why they’re reaching out to professionals in local government, public health, services for older
adults, corrections, nonprofits, treatment
centers, the people operating the casinos,
as well as students.
“Gaming brings increased revenue to
the city and increased jobs, and there’s a
Whiting Cafe “Makeover” This Weekend
who reportedly did not own NutriJoy
stock. A motion passed unanimously
to recommend the Coca-Cola proposal to NutriJoy and affirming that
NISTAC was 1) waiving the distribution of any financial return on its
shares acquired in lieu of cash until
all existing shareholders have recovered their capital investment; and 2)
eliminating its royalty requirements
in order to facilitate a sale of stock.
Furthermore, the Executive
Committee authorized Mr. Krause
and Mr. Glasscock to negotiate with
NutriJoy on behalf of NISTAC a capitalized future return for the elimination of its royalty requirement.
Again, Mr. Glasscock was a member
of the NISTAC Board, President of
NISTAC and a shareholder in
NutriJoy, yet it was not noted that he
abstained from voting. Mr. Krause
was Executive Chair of the Board of
NISTAC, Chairman of NutriJoy and
a shareholder in NutriJoy, yet it was
not noted that he abstained from voting.
While NISTAC has established a
written protocol to address conflicts
of interest, it does not appear that the
protocol is followed. The possibility
for future conflicts of interest such as
that arising from the Coca-Cola
transaction and the actions of Mr.
Krause and other NutriJoy shareholders who were also in a position
of influence at NISTAC should be
carefully considered by the
University and the Foundation. The
Foundation may want to consider
increasing their oversight through
Board and Executive Committee participation to ensure that they are fully
informed with regard to NISTAC
and its incubated companies’ operations.
With regard to the Wildman
Harrold report, NISTAC should
obtain positive confirmation from
Wildman Harrold or Husch
Blackwell Sanders LLP that the current composition of its various
Boards of Directors, Committees and
Sub-Committees and Advisory
Boards conforms to the recommendations of the Wildman Harrold
report and any subsequent changes in
regulation and tax law.
NISTAC should continue working
with Husch Blackwell Sanders LLP
to revise its compensation policies to
ensure compliance with all regulations and tax laws. The resulting recommendations and implementation
of those recommendations by the
NISTAC Cluster should be reviewed
by the University and the
Foundation.
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ceiling tile, add shelves, scrub grease off
walls, general clean-up, hang new curtains
A new exhaust fan, air conditioner, and
stand-up freezer will be installed.
A local Holton company, Chiles, is reupholstering the counter stools.
There will be new chairs. We're spray
painting the table pedestals.
The exhaust fan and air conditioner
went out last week and we don't have
enough money, to date, to pay for those.
These are tax deductible donations
made to the Kansas Sampler Foundation.
This is a project of our non-profit whose
mission is to preserve and sustain rural
culture.
The city is installing new curbing.
Rosa will feed us meals out of the
community center.
The post office clerk took off two days
so she could be part of the action.
Lower Appliance is giving Rosa a deal
on the air conditioner.
Rosa is in disbelief that this is happening to her.
the work they have performed for
each entity.
• Up to one-third of all equity compensation of NISTAC and MTM is
funded into the MTM Trust but
MTM Trust documents list MTM as
the sole entity funding the MTM
Trust.
• NISTAC royalty/licensing
income and incentive equity grants
to employees are inversely related.
Should NISTAC receive equity for
royalty and licensing fees instead of
cash, employees may be unjustifiably rewarded at the expense of
NISTAC’s profitability.
NISTAC’s Compensation SubCommittee established a cap of
“three times salary” with respect to
incentive compensation relating to
licensing revenues. With respect to
equity compensation, NISTAC is
currently working with the law firm
of Husch Blackwell Sanders LLP to
develop equity compensation rules
that are compatible with the recommendations of Wildman Harrold.
Findings and Recommendations
NISTAC has an established protocol for disclosing conflicts of interest
through its bylaws which requires
that directors declare their interest
and/or engagement with another
party or entity in advance to the other
directors and abstain from voting on
any agreement with the entity in
which they have a personal interest.
In relation to the Coca-Cola transaction, the April 17, 2007 NISTAC
Board minutes indicate that the
Board empowered the Executive
Committee to take necessary and
binding actions in between Board
meetings with the understanding that
the Executive Committee would give
due consideration to maximizing
potential long term value for
NISTAC while meeting other objectives within its mission. The motion
passed unanimously.
Mr. Glasscock was a member of
the NISTSAC Board, President of
NISTAC and a shareholder in
abstained from voting. Furthermore,
Mr. Krause was Executive Chair of
the Board of NISTAC, Chairman of
NutriJoy and a shareholder in
abstained from voting. On August
15, 2007 the Executive Committee
of the Board met to review the terms
of the proposal by Coca-Cola to
acquire a controlling interest in
NutriJoy. The Executive Committee
consisted of Messrs. Krause and
Glasscock, both stockholders in
NutriJoy, and three other members
The Kansas Sampler Foundation
selected the Whiting Cafe, owned by
Rosa Thomas, to be our kick-off project
for the "We Kan Bank" -- a social capital
project matching rural communities with
needs with people who can and want to
help.
Rosa will have owned this cafe in
Whiting, a town of 206, for 25 years
come August. We're helping her spruce it
up for her anniversary. Whiting is in
Jackson Co., Kansas.
More than 30 people will be coming
from around the state to help, plus locals
will be helping. Many more people have
contributed over $4,600 dollars to
finance the improvements.
Here are some of the things we'll be
doing:
Paint the outside of this concrete block
building
Paint a mural on one side (Food so
great you'll scrape your plate -- 25 years
of homemade cooking).
Plant a flower bed
Install new windows
Inside: paint walls, patch floor and
lot of excitement in that,” Holthaus said.
“What we know about gambling is that
the majority of people can gamble for fun
and not have a problem.”
A recent survey done in Oregon
reported that 60 percent gambled for
entertainment and fun, 12 percent to
socialize and 7 percent to win money.
Holthaus said the latter group has a higher risk for problem gambling than the rest
of the adult population.
Holthaus also said that research suggests 1 percent to 3 percent of the population will become pathological gamblers
and 3 percent to 6 percent will have problems with gambling. Pathological and
problem gambling come with social
costs, like an increase in such crimes
such as forgery and auto theft, along with
the financial costs of bankruptcy, embezzlements and unemployment. She said
that in addition to relationship and mental health issues, problem gambling can
carry with it physical symptoms like anxiety, depression and asthma.
Maddux said this makes a difference
when treating clients.
“A part of the treatment planning
process is identifying and finding positive solutions to the multidimensional
issues people are experiencing when they
seek treatment,” she said.
In addition to being a certified financial planner, Maddux also is an addiction
and prevention services certified counselor and certified problem gambling
counselor. She said that from her clinical
experience, gambling often appears with
other problems, such as alcohol or drug
misuse.
“When I work in clinic, there are people who present with just gambling problems alone,” she said. “However, it’s not
uncommon to see chemical abuse or
other behavioral problems.”
Certain sectors of the population may
be more vulnerable to problem gambling,
according to Maddux and Holthaus, such
as older adults and people with lower
incomes who can be attracted to the hope
of a big win. In turn, this can strain communities if more people seek food stamps
or help from local charities. The latest
research, the facilitators said, shows that
18 percent of men and women in rescue
missions cite gambling as the cause of
their homelessness.
“If there are opportunities to intervene
with people who have problems with
gambling, we have an obligation to see
that opportunities are in place to address
those problems,” Maddux said.
herewith and the circumstances
under which such payments are due
to Licensor from Licenses.”
It should be noted that we requested and were denied access to the
NutriJoy Stockholders’ Agreement
referred to above. Mr. Glasscock
indicated that the referred to payments will be a modest distribution
to NISTAC after all Class A stockholders have received a return of $1
per share, but prior to any distribution to Class B (NISTAC) or Class C
(Coca-Cola) stockholders.
The NutriJoy Stockholders’
Agreement may provide further relevant information regarding the CocaCola transaction and further description of the rights of the various classes of NutriJoy stock as well as stock
awards to officers and directors. Had
we been allowed to review this document, it is possible that findings of
an adverse nature may have been
identified.
Wildman Harrold Report
The NISTAC Cluster was originally established in the 1990s using a
model developed by KTEC. In discussions with similarly-structured
entities, NISTAC management
became concerned that their corporate structure might be incompatible
with recent changes to governing
regulations and tax laws. In 2005,
NISTAC engaged the services of
Wildman, Harrold, Allen & Dixon,
LLP (“Wildman Harrold”) to make
an assessment of the structure of the
NISTAC Cluster and its operations
and employee compensation policies.
On March 6, 2006, Wildman
Harrold prepared a report which
found that the Boards of Directors
and Committees of NISTAC, MTM
and Holdings were “too intertwined.” At NISTAC’s August 22,
2006 Board of Directors meeting,
several personnel changes were
made to the Boards of NISTAC and
MTM as well as changes to the
NISTAC Executive Committee and
Compensation Sub-Committee to
address this recommendation. In
addition, various findings addressed
the manner in which equity compensation was awarded, specifically:
• Grants of equity to employees
(by way of the MTM Deferred
Compensation Trust, the “MTM
Trust”) may violate reasonable compensation rules promulgated by the
IRS relating to not-for-profit entities.
• Incentive compensation to
employees should be properly allocated. Employees of NISTAC and
MTM should only be rewarded for

City Has Financial Ties To NISTAC

Transcription

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