Wyandotte County Democratic Chairman Matt Watkins alleges that Steineger "has accepted thousands of dollars from the federal government to restore property he owns." Watson says Steineger was asking for tax credits for the Lowell school while at the same time attempting to change the rules on how for-profit developers were awarded tax credits.
"According to multiple sources, the Kansas Bureau of Investigation is in the process of conducting an investigation to determine if Sen. Steineger used these taxpayer dollars illegally," Watkins writes in a press release issued today. "Sen. Steinerger needs to immediately address these allegations of corruption and illegal behavior."
Steineger did not return a phone message left at his home by The Pitch. Steineger did tell the Wyandotte Daily News that he received a phone call from the KBI months ago and answered questions but hasn't heard anything since.
Kyle Smith, deputy director of the Kansas Bureau Investigation, would neither confirm nor deny the existence of an investigation.
Steineger is up for re-election in the 6th District, a seat he has held since 1997. He's running against Democrat Pat Pettey, a former Kansas state rep. Steineger defected to the Republican Party two years ago.
Sherriene Jones-Sontag, Gov. Sam Brownback's communications director, told The Pitch in an e-mail: "The Governor's office has no comment."
In a March 9, 2012, e-mail to Sens. Susan Wagle and Martha Smith, Kansas Housing Resources Corporation deputy director and general counsel Ryan Vincent wrote that Steineger was offering an amendment that the senator would have financially benefited from. Vincent wrote:
"As we noted in our conversation, KHRC is concerned that Senator Steineger has a conflict of interest on this matter, as he has an application pending with us with a potential developer fee of $181,732 on the line. Moreover, his developer fee for Historic Lowell Lofts that he received under KHRC's Credit Exchange Program amounted to $450,000. As you can see, he has personally benefited from our programs and has a vested interest in the outcome of any policy changes."
KHRC executive director Dennis Mesa followed with an e-mail to Wagle the same day: "Although, with the initial argument for tax-paying business versus a non-profit entity receiving favorable scoring points may seem a rather simple issue, the underlying complexity of this amendment by a developer/Senator Steineger is most unsettling, as we had spoke to earlier."
Steineger withdrew the amendment.
On October 17, Steineger defended his Lowell restoration project to the Wyandotte Daily News.
"The Lowell School project used Low Income Housing Tax Credits, Historic Rehabilitation Tax Credits, and a large bank loan to renovate and convert a historic 1898 school building into apartments for limited income seniors. ... In 2010 a newspaper reporter called to say a 'source' which was never revealed, alleged I used political influence in this process. To my knowledge, nothing ever came of it.
“Once again," Steineger continued, "a 'source' is making the same allegations. Earlier this year, I was contacted by the KBI, was asked and answered questions regarding the Lowell School project, and I have never seen a report since. Considering the 'sources’ are hard-core political partisans who hate my politics, and that they make their allegations three weeks before an election, it seems like typical election year politics.”
In 2010, the Kansas Governmental Ethics Commission fined Steineger $5,000 for violating state campaign finance law after determining that the senator had improperly paid for polling with money from his Senate re-election campaign account. Steineger first claimed that he paid for the polling with his own money but later said that wasn't true.
Steineger has also been accused of asking 40 lobbyists for campaign contributions while the Legislature was in session. The ethics commission determined that Steineger did not "knowingly" break the ban.
In May 2010, Steineger hired disgraced Missouri lawmaker Mike Sager as his campaign finance director. In January 2007, Sager pleaded guilty to filing a false campaign report. He had been charged with writing $22,500 in checks from his campaign accounts to himself as well as making up a $50,000 personal loan.
In August 2009, The Pitch reported that Steineger got into a bar fight at Breit's Stein and Deli in Kansas City, Kansas, while arguing with another man about health-care reform. Steineger's spokeswoman confirmed that there was an argument and a punch was thrown, but denied that Steneiger had a black eye. But he did. Multiple sources at the Kansas Capitol confirmed it. Steineger later claimed that he got "sucker punched."
Attorney Thomas F. McGraw disputed Steineger's story. His account: Steineger was drinking at Breit's with his wife when he got into an argument with Richard Carney (whom McGraw represented) escalated. Steineger grabbed Carney's tie and took a swing at him; Carney blocked it and popped Steineger in the eye. McGraw said Carney acted in self-defense and Steineger was the "primary aggressor."