Kansas AG’s ‘No Bid’ Contracts Raise More Questions

TOPEKA, Kan.- Last week, after a number of news outlets reported that Kansas Attorney General Derek Schmidt had hired a high-priced, politically-connected law firm to represent the State of Kansas in upcoming litigation, the Kansas Democratic Party launched an investigation into the process used by the Attorney General’s Office to hire the firm in question. The KDP found a number of alarming facts surrounding the bidding process, and Jeff Chanay, the individual who AG Schmidt placed in charge of awarding state contracts.

In November 1998 the State of Kansas entered into the Master SettlementAgreement with the country’s four biggest tobacco companies.

The law firm of Entz & Chanay, where now-Deputy AG Jeff Chanay was a partner, was hired by then-AG Carla Stovall to negotiate terms of the agreement. An ensuing investigation by the Republican-controlled Legislature found that Stovall used a ‘no bid’ process to select Entz & Chanay for the $27 million contract(1).

Not only was Stovall a former employee of the firm she selected, but the legislature found Entz & Chanay hadn’t kept track of their billable hours(2).  During deposition they were only able to produce one file folder worth of work for the case(3).

In response to Entz & Chanay’s egregious billing, the Kansas legislature created a new Kansas statute, KSA 75-37,135, requiring the Attorney General’s office to conduct a bidding process for contracts that are to exceed $1 million.

Now Mr. Chanay has been placed in charge of awarding the very same contracts his law firm took advantage of during the late 1990’s(4).

“It’s troubling to see AG Schmidt putting someone that cost the state millions of dollars in charge of awarding ‘no bid’ contracts for outside counsel.” said Kenny Johnston, Executive Director of the Kansas Democratic Party. “The actions of Jeff Chanay’s law firm prompted much needed anti-corruption legislation in the 1990s. Putting him in charge of state contracts is like putting a fox in charge of the hen house.”

Last week it was revealed that Jeff Chanay used the same ‘no bid’ tactics in his selection of outside counsel Foulston Siefkin.
1) http://cjonline.com/stories/031600/leg_videotape.shtml