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Friday, May 25, 2012

St. Louis County Council Member Gets Contract Despite Bankruptcy

BY PAUL HAMPEL > 314-727-6234 | Posted: Friday, May 25, 2012 12:05 am

CLAYTON • St. Louis County Council member Kathleen Burkett has been selected to operate the Maplewood License Office, one of the top revenue-producing fee offices in the state, even though she was in bankruptcy last year and owed federal income taxes dating to 2008.
The Missouri Department of Revenue last week approved the application from Burkett, a Democrat from Overland, over eight others. The state gave Burkett the highest overall score, and also scored her highest in a category that included financial stability and experience.
Through bankruptcy, Burkett was able to shed about $130,000 in credit card bills to such retailers as Neiman Marcus, Bloomingdale's and Macy's. Burkett filed for bankruptcy in March 2011 and her debts were discharged in July. Her petition also noted that she owed $8,356 in federal income taxes, which cannot be discharged through bankruptcy, for 2008 and 2009.
Burkett, 66, has served on the County Council since 2002 and is running for re-election.
She said Thursday that decades of experience working in license offices qualified her to serve as the fee agent in Maplewood, her financial problems notwithstanding.
"This is what I've done my entire life, for 47 years," Burkett said. "There's nobody — and I'm saying this with complete confidence — in the state of Missouri who has more knowledge or capability to run a license office than I do."
When Democratic Gov. Jay Nixon took office in 2009, he vowed to reform the Missouri tradition of awarding fee offices to political allies as patronage plums.
Nixon could not be reached for comment on Thursday.
A spokesman for Dave Spence, a Republican gubernatorial candidate, asserted that the Burkett selection was purely political.
"It is beyond comprehension how someone who recently filed for bankruptcy could receive the highest score for financial management," the spokesman, Jared Craighead, said. "The fact is that one of Nixon's political cronies was in financial trouble and they found a way to help her by giving her a fee office."
Burkett said she was acquainted with Nixon, "but we're not close personal friends."
Burkett's application listed as references two fellow Democratic officials, County Executive Charlie A. Dooley and County Assessor Jake Zimmerman, and two lawyers, Thomas Campbell and Thomas R. Green.
Spokesmen for Dooley and Zimmerman said Thursday they had not applied any political pressure on Burkett's behalf. Campbell is with the firm of Polsinelli Shughart, having departed last month as managing partner of the Gallop firm. Green runs a firm bearing his name in Maryland Heights.
Ted Farnen, spokesman for the state Revenue Department, hung up on a reporter before a question could be asked regarding Burkett's selection. Farnen later sent an email statement that read: "This was a competitive bid process, and the contract was awarded to the bidder with the highest score. This was the same process that has been used since an open and competitive bid process was established in 2009."
The request for proposal that candidates were required to complete noted that criminal background checks would be conducted and that candidates could be considered ineligible for such findings as "theft, embezzlement, fraud, tax evasion or any offense related to those listed."
Burkett's contract was first reported by McGraw Milhaven on his talk show on KTRS Radio.
Burkett said she has reached an agreement with the federal government to pay off her taxes in monthly increments. She said she still owes about $4,000.
She blamed her credit card debt on a decline in income related to her family's loss of the contract it had held for years to run the license office in Overland.
"My mother was the fee agent for that office and I began working for her there in 1965," Burkett said. "She was the agent but I did most of the work and made a fairly decent salary, over $60,000."
Burkett said that, in 2005, representatives of then-Gov. Matt Blunt gave notice that it planned to award the Overland office to a different entity.
From there, Burkett found work as a consultant with a license office in the city of St. Louis. But she said city officials steadily cut her hours until she was making only a fraction of her former salary.
However, she said she had continued to spend money as if her salary had never declined.
"I was living high on the hog," she said. "I was single. I had a nice life. I could afford to pay for things.
"But then I quit making any money and I couldn't afford to pay for them. And you'd be surprised how fast you can get in debt."
In 2010, after she lost her contract with the city of St. Louis, Burkett found work managing the license office in Ferguson for $36,000 a year.
"I tried to handle my financial affairs," she said. "I went to a counselor but I had too much debt." She said filing for bankruptcy was traumatic.
"Do you know how demeaning it is, knowing full well what would come about and how that would look for me as an elected official?" she said. "Bankruptcy was the only choice I had left. Was it stupid of me (to get in debt)? Yes. But it was a learning experience."
Candidates for the license office were also required to provide documentation to the state verifying credits and/or assets of at least $105,000.
Asked how she had managed to raise such funds after emerging from bankruptcy, Burkett said: "I had some people that were willing to co-sign on a loan for me." She declined to identify her backers.
Last year, the Maplewood office (formerly known as the Deer Creek office) collected $418,000 in fees. Burkett estimated her operating budget would be about $417,000 and that she would pay herself a salary of $40,000 to $45,000.
Those estimates would put her well below the $60,000-plus that she had once earned working for the family business.
"You don't drag a lot of money out of these offices, believe me," she said. "But if you run it properly and serve your customers well, word gets out that it's a good license office and you can build up a clientele and, yes, make a little money."
Burkett said that, before applying for the job, she checked with County Counselor Pat Redington and was told there were no legal obstacles preventing her from working as a fee agent while serving on the County Council. The council job pays $20,000 a year.
Burkett's score on the state's application was 73.64 of a possible 100. She edged out the second-place finisher, the nonprofit Mid-America Transplant Services, which scored 73.07.
In her application, Burkett said she would return about $29,000 in revenue annually to the state from the operation. Mid-America had estimated an operating budget of $360,000 and proposed giving $62,000 back to the state.
Molly Culp, the finance director at Mid-America, said winning the contract would have helped the organization raise awareness of its efforts to coordinate organ and tissue transplants.
She said, "We're sorry that we're missing this opportunity to reach people."
Editors note: Propping up an inept and corrupt Democrat hack like Burkett is more important to the governor than helping the sick and poor. Charlie Dooley and Jake Zimmermann are emblematic of the further Chicagoization of St. Louis County into a political patronization paradise. Disgusting!

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