Sam Brownback’s stock portfolio is bullish on Kansas vendors and regulated companies

When it came time for Kansas Gov. Sam Brownback to pay for a meal at Topeka barbecue joint Boss Hawg’s earlier this month, his server crossed out the ticket’s tip line and wrote: “Tip the schools.”

Brownback left a little money for Chloe Hough anyway, 10 percent on the $52 tab — markedly below the industry standard for adequate service. You could chalk up the meager gratuity to perceived insolence from Hough, but you can’t say Brownback couldn’t afford to do better by restaurant help. Beyond the $99,636 salary he makes as the governor of Kansas, he holds a considerable stock portfolio — one that has expanded impressively since he took office.

Brownback and other state lawmakers have to file “statement of substantial interest” paperwork with the Kansas secretary of state’s office every year. The SSI form discloses stock holdings and other investments. According to his 2010 filing, Brownback held common stock in 11 companies when he was elected governor that year.

In his most recent SSI disclosure, filed April 24, that portfolio had ballooned to 86 companies, many of which intersect with the functions of Kansas government.

One of Brownback’s holdings: Anthem Inc., which used to go by WellPoint Inc.

In 2012, WellPoint bought Amerigroup, a managed-care company that is one of three contractors under the governor’s KanCare program. KanCare, which went into effect in 2014, was Brownback’s bid to privatize the state’s Medicaid program. He hailed it as a means to save the state money on its Medicaid program, one of the largest line items in the Kansas budget. But KanCare got off to a notoriously rocky start, with disabled residents suffering interruptions of their care.

KanCare hasn’t fared much better for its providers.

The Topeka Capital-Journal reported last week that three KanCare providers had lost a collective $52 million in 2014. Amerigroup scored the worst, with $19 million in losses.

It’s not clear when Brownback acquired his WellPoint stock. It wasn’t listed on his 2012 SSI, submitted in April of that year. Amerigroup, the WellPoint subsidiary, received the state’s contract for KanCare in June 2012. Brownback’s SSI form from April 2013 showed his ownership of WellPoint stock.

Brownback also holds stock in Westar Energy, the utility company based in Topeka that serves western portions of Johnson County. Westar, like other utilities in Kansas, is regulated by the Kansas Corporation Commission. The KCC’s commissioners are appointed by Brownback. If Westar wants to increase its rates, it seeks approval from these Brownback-appointed commissioners.

Brownback also holds stock in ONEOK, which owns Kansas Gas Service, another utility governed by the KCC. [Clarification: ONEOK owned Kansas Gas Service until January 31, 2014, when ONE Gas spun off from ONEOK, taking Kansas Gas Service with it.]

Before Brownback became governor, his stock portfolio was relatively vanilla and largely devoid of companies that did business in Kansas. Back then, his holdings included national and transnational companies, such as Eastman Kodak, Coca-Cola, Comcast and IBM. His primary listed Kansas investment was 162 acres of farmland in Linn County.

Kansas ethics laws require the disclosure of stock holdings of elected officials, which Brownback has done. The law is silent about whether elected officials can hold ownership positions of companies that do business with, or are regulated by, Kansas government.

The governor’s office tells The Pitch that Brownback personally has nothing to do with his stock holdings.

“The Governor’s investments are held in a trust managed by a brokerage firm,” Brownback spokeswoman Eileen Hawley tells The Pitch in an e-mail. “The Governor has no day-to-day involvement with the trust for the sale or purchase of stocks. In response to your specific question, he did not direct the sale or purchase of Wellpoint stock. As the investments are owned by the trust and managed by a third party, and not by the Governor as an individual, there should be no potential for a conflict of interest or the appearance of one.”