The Salina Journal from Salina, Kansas on April 29, 1997 · Page 7
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The Salina Journal from Salina, Kansas · Page 7

Salina, Kansas
Issue Date:
Tuesday, April 29, 1997
Page 7
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THE SALINA JOURNAL GREAT PLAINS TUESDAY, APRIL 29, 1997 A7 T KANSAS GOVERNMENT Officials wonder why investment left Kansas Economic development money went to man with troubled financial history By.JOHN HANNA T^eAssoclateci Press , TOPEKA — State economic development officials face questions about $1,60,000 in loans made by a venture capital fund to a Texas company whose principal figure also is a vice president of Rio.Core Inc. Two Senate leaders and Lt. Gov. Gary Sherrer, who also serves as state secretary of commerce and housing, said Monday they want Kansas Technology Enterprise Corp. officials to provide some answers about loans in 1995 and 1996 to Rubber Recovery Technologies of Fort Worth, Texas. •.The loans came from the Ad Astra II V LOOSE COW fund, one of two venture capital sources created with a combination of Kansas Lottery proceeds and private money. KTEC is the state agency charged with helping stimulate the development of high-technology businesses. KTEC is a partner in the Ad Astra funds, but another partner, a Lawrence company, Campbell-Becker, manages them. Senate President Dick Bond, R-Overland Park, and Minority Leader Anthony Hensley, D-Topeka, said KTEC officials should answer questions .about the use of Ad Astra monies. And Rep. Doug Spangler, D-Kansas City, is seeking appointment of a special House committee to review all economic development programs. Hensley said, "I have always,thought the economic development programs have gotten away from the Legislature in terms of oversight." Sherrer, who serves on the KTEC board of directors, said he plans to ask the board to discuss at its June meeting how loans are made from the Ad Astra funds. "I want the issue raised about why we are investing out of state," Sherrer said. Rich Bendis, KTEC's president, said the management of Ad Astra by Campbell- Becker is designed to prevent one partner, such as KTEC, from having a heavier influence than another partner, such as Western Resources, the state's largest energy utility. He said the arrangement is common for venture capital funds. "We do not get involved in their investment decisions," Bendis said. "Generally, all venture capital funds have managing partners." Bond, Hensley and Sherrer made their comments following newspaper reports about Rubber Recovery's principal figure, Harvey Franklin Greenwald. But Spangler began pushing for a review of economic development programs more than three weeks ago. Tax trouble In Texas The Topeka Capital-Journal said in its Sunday editions that 16 of 17 businesses that list Greenwald as president have had their corporate charters revoked in Texas for failure to pay franchise taxes. The 17th is Rubber Recovery, and the Texas secretary of state's office mailed it a tax delinquency notice on April 11. The newspaper also cited two lawsuits in Texas against Greenwald over business activities, as well as several failed ventures on a South Dakota Indian reservation that led tribal officials to bar him from doing business. Sam Campbell, the president of Campbell-Becker, said the company made the loans to Rubber Recovery because Green- wald originally planned to bring a manu-; facturing plant to Kansas. He now plans to build his plant outside the United States, but Campbell said Greenwald has signed ', an agreement to pay the Ad Astra II fund r $300,000 — twice the amount of the loans. * "The man — I've known him for several years — has never lied to me. He's never deceived me," Campbell told the '' Capital-Journal. "I would do anything for him. And I trust him completely." Greenwald is vice president of corporate finance for BioCore, a Topeka med- . ical products company. BioCore has come under public scrutiny in part because House Speaker Tim Shal- ' lenburger, R-Baxter Springs, and Rep. Greg Packer, R-Topeka, are vice presidents. Gov. Bill Graves told the Capital- Journal the new information was "troubling" and said a thorough review ' would be appropriate. Cow on the run injures boy in north Salina • Brahma cow made it 12 blocks after escaping from - - sale barn By CAROL LICHTI The Salina Journal A Brahma cow escaped from a sale barn Monday evening, ran through several Salina neighborhoods and injured an 8-year-old boy before she was rounded up. The cow, which got loose about 7:10 p.m., was captured by riders on horseback in Dry Creek near the 1200 block of North 12th. She had made her way through about 12 blocks in north Salina from the Farmers & Ranchers Livestock Commission on Old Highway 40 just west of the city limits. Perfecto Martinez, 8, 924 N. 12th, was injured when the cow ran into him, a witness said. He was taken to Salina Regional Health Center for treatment. A police patrol car followed the bovine after it was reported loose, keeping track of its whereabouts and trying to prevent any accidents be- fore employees of the livestock commission could come fetch her. She crossed Broadway Boulevard, a busy thoroughfare, without incident. Eulah Johnson, 926 N. 12th, was in her yard talking to her sister on her cellular phone. "There's a cow going by," Johnson said she suddenly announced into the phone. Her sister said "What?" "I wasn't sure if it was a bull or TCOURTS fines imposed for aviation fraud what, but I knew it was a cow going by," Johnson said. The cow was about 10 feet from her and ran through her yard and through neighbors' yards to a trailer court on the north end of 12th Street. A group of children chased the cow, and the cow turned and ran at the boy. Then the cow ran into Dry Creek, where ranch hands were finally able to capture her and take her back to her corral. RALPH WEIGH Bonds - Insurance Phone 827-2906 115 East Iron •17 15 Per Month Some Qualifications Apply 913-825-1581 1911 S. Ohio, Salina, KS Employees schemed with subcontractors to defraud Boeing, Learjet By TRACI CARL Ttle'Associated Press WICHITA — Nine businesses and 11 individuals were fined a total $2.6 million Monday for their r_oles in a scheme to defraud Boeing Co. and Learjet. f U.S. District Judge Monti Belot also placed the defendants, who \vere from five states, on probation during Monday's sentencings. :The defendants pleaded guilty Jan. 22 to federal charges of mail T KANSAS GOVERNMENT fraud, wire fraud and depredation, or theft, of defense material being constructed for the United States. A 20-month undercover federal investigation found that several aviation subcontractors were making inflated contract bids for airplane parts — and giving company employees kickbacks for their help. Under the bid-rigging scheme, subcontractors seemed to be bidding competitively to provide aircraft parts like door balances or smoke detectors. In fact, they were working together, providing inflated competing bids and rotating who would offer the lowest bid, U.S. Attorney Jackie Williams said. Bids were inflated as much as 1,300 percent of what they should have been, Williams said. An airplane parts buyer at Boeing's Wichita plant started the scheme, Williams said, and the initial bids were mostly for government contracts. The parts buyer — whom Williams would not identify — worked for Boeing for two years and then started a private business and worked as a "middle man" for Wichita-based Learjet. When he approached a Learjet buyer and offered him a bribe in connection with the kickback scheme, the employee reported the man to authorities, Williams said. Federal investigators placed an undercover "buyer" at Boeing. That individual contacted companies believed to be involved in the kickback scheme and offered to take bribes for inflated private contracts. The kickback money received by the undercover buyer was returned to Boeing, but the fines will be turned over to the U.S. Department of Justice, spokeswoman Chris Watney said. The individuals and companies that pleaded guilty were from Kansas, Maryland, California, Oklahoma and Arkansas. Delay in water standards signed into law j \_j fax appraisal law needs repair when Legislature resumes By. The Associated Press ; TOPEKA — Gov. Bill Graves has signed into law a bill suspend- ing'Kansas' most recent surface water quality standards for two years while a new commission reviews the scientific data on which they are based. The bill was among those announced on Monday as signed. Graves issued no statement in connection with putting his signature on the bill, which sets the acceptable amounts of pollutants in state rivers and streams. It represents a compromise legislators said was acceptable to all but the most vocal environmentalists. "This gives us time to study the problems (with the standards)," said Rep. Steve Lloyd, R-Clay Center, chairman of the House committee that handled the bill. "We just need the data to see if these stream designations are correct." The bill implements a compromise reached between the federal Environmental Protection Agency and state Department of Health and Environment over what standards are acceptable to the EPA during the moratorium. Under the agreement, the state will suspend imposition of its 1994 standards for two years while a state commission appointed by Graves reviews scientific data used to develop those standards. It mainly affects 35 cities — including Topeka, Lawrence, Olathe, Parsons and Independence — whose wastewater treatment plants do not meet the standards. They get a two-year reprieve on upgrading their plants. If, at the end of the moratorium on July 1,1999, the EPA cannot be persuaded that the standards should be less restrictive, the state will have to retain them, and cities and farmers will have to comply. Flaw In tax appraisal law The bill creating the Kansas Tax Equity and Fairness Act, which Graves signed with great fanfare last Friday, is flawed. The flaw is not considered fatal, but it is serious enough that corrective language is expected to be included in a conference committee report on another bill — to fix the tax equity error — when the Legislature convenes Wednesday for its wrapup session. The final measure refers to both reappraising annually and reappraising every two years. Property tax lid The state will have a lid on local property taxes until July 1,1999. Graves signed into law a bill that extends the lid for two years. Connection It's Tuesday! * ^ •: v KID'S EAT FREE! 10 yrs & under, child's menu accompanied by paying adult, (2 children per adult please.) Cooked The WayWdCooklt! 2351 S. 9th (Central Mall) • No Setup Fee! • Toll Free Customer Service Available 7 Days PerWeekl • Security Expertise... Web Development... Software... Dedicated Access.. .Education! 1-800-316-4581 www NETSPACE INTERNET SERVICES P B Of* S-S;•• ON H L Nearly Me® Mastectomy Products Call Ginger today for more details. 1331 Armory Road, Salina, 825-4400 or 1-800-S72-6177 STUDENT ACHIEVERS Solomon students place in state contest Solomon students were among 225 schools represented in the Kjansas Scholarship Contest. i Solomon students placing in the liV division of schools were: Jay Montgomery, first in biology and third in world geography; Scott IVJinneman, third in biology; and Jpmes Roberts, third in chem. • Montgomery placed third overall in biology. ,The Solomon students also pjaced at the league tournament. Students placing were: Brandy Offonewoller, first in sophomore English and tie for third in Algebra II; Elizabeth Quested, first in Algebra I; Jay Montgomery, first in biology and first in geography; Scott Jungel, tie for second in phemistry; Bernie Kohman, second in geography; Katy Ferrell, second in psychology; Pam Rein- bold, third in psychology; and Rachelle Gutzman, tie for second in accounting. South student takes third for cartoons Michael Freeland's editorial cartoons won third place on April 19 at the Kansas Scholastic Press Association's state contest at the University of Kansas. Freeland is a junior at Salina South High School. A total of 157 high schools sent students to the contest. Wilson journalism students win at state The 1996 Wilson High School Yearbook won the All Kansas Award at the Kansas Scholastic Press Association State Journalism Contest on April 19. Also placing in the competition was Tara Bay, a Wilson High ju- nior, who won second place in headline writing. Cloud County students win awards CONCORDIA — Cloud County Community College freshman Adrianne McDaniel was named journalist of the year in the two- year magazine division at the Kansas Associated Collegiate Press Publications Contest on April 17 and 18. McDaniel, Beloit, is editor of the college's student publication "Stepping Stone." She also received honorable mention in the topical issue writing category. Other students winning honors were: Jessica Johnston, Concordia sophomore, first runner-up for the two-year magazine journalist of the year; Kristy Pelesky, Belleville freshman, third place in logo design; Joe Hagen, Salina freshman, first in infographic design and third in graphic design; and Tisha Dewey, Mankato sophomore, honorable mention in freehand illustration. Former staff members also received awards — Russell Mason, Concordia, third in feature photography, and Megan Melby, Scandia, second in topical issue writing and honorable mention in opinion writing. From Staff Reports 0Nr M ywj hptiiwt Carl Strecker - Sales Wayne Wetzel-Owner 913-488-3617 Your Neighbor In Time Of Need As a member of the community since 1906, the Geisendorf Rush-Smith family understands the importance of caring and respect. For professional guidance in your time of need, call or visit us today. ush Smith -Funetal S(orr» 401 West Iwn • Sallm • Sg3-3^58 "Heivforyvu sinoe 1906$. PORK TENDERLOIN Small Fries & Small Drink I only 9th&Kirwin 823-8066 No need to shep around Meet Brenda Wiggins, a 12 Year Veteran at Security Savings Bank. Ifcryour next home loan, you can count on Brenda to save you money. 3 17 S. Santa Fe • 1830 S. Ohio^alina, KS 825-S241 Statewide toll-free number 800-323-8958. With offices in Salina, Garden City, Olathe, and Wichita MEIV^BERFDIC

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