Senate gets new offices, taxpayers get big bill
Michigan state senators are getting a new home – offices some lawmakers say they don’t need – while the people of Michigan are stuck with a tab that will reach $134 million.
The deal dates back to 2012, when state officials were considering moving some state agencies out of privately-owned buildings in Lansing to save millions in rent. Concerned that the Department of Community Health might break its lease on seven floors in his relatively-new Capitol View building, developer Ron Boji began proposing that senators leave the state-owned Farnum Building for renovated offices in Capitol View.
He found a sympathetic ear in Senate Majority Leader Randy Richardville, a Monroe Republican who couldn’t stand the out-dated Farnum Building, which was notorious for heating and cooling problems, as well as leaks and other inconveniences.
State officials said it would have cost between $11.5 million and $20 million to renovate the Farnum Building. Instead, Richardville invited developers to submit proposals to the Senate, and he convened a team of state officials to review the deals and report back to him.
Four developers made the cut, and were given seven questions that officials said they should be prepared to answer. Three of those developers voluntarily provided written answers. Only the Boji Group did not.
One of the questions the developers were asked is whether they owed any taxes. At the time, the Boji Group owed more than $65,000 in Michigan Business Taxes. Boji spokesman John Truscott says Boji doesn’t recall whether state officials asked him during an oral interview if he owed taxes.
In any case, Truscott says, Boji had negotiated a payment plan with state Treasury officials. Treasury officials say they cannot comment on individual tax cases.
Richardville says he did not know of the Boji Group’s tax situation. Firms that owe taxes can be barred from bidding on state contracts.
Senate officials rated the Boji Group’s proposal tops among the four it reviewed, and in 2014, Richardville agreed to a deal for the Senate to purchase seven floors in the Boji Group’s Capitol View building for $51 million. By the time furnishings, moving the Department of Community Health, interest payments on the bonds and other costs are factored into the deal, it will cost taxpayers $134 million.
But that wasn’t Richardville’s only deal with the Boji Group. After term limits ended Richardville’s career in 2015, he began working as a consulting for a firm in which Boji has an ownership interest.
Richardville says he has multiple clients and the Capitol View deal has nothing to do with his current business relationship with Boji.
Some state lawmakers have objected to the Capitol View deal, even asking Michigan Attorney General Bill Schuette to look into it. Schuette declined. Since 2011, Ron Boji and his wife Heather have donated more than $21,000 to Schuette’s campaign account. They even hosted a fundraiser for him at their home in 2014. Both Truscott and Schuette’s spokeswoman say the contributions have nothing to do with the attorney general’s decision not to delve into the Capitol View deal.
Senators are expected to move into their new offices next year. That will leave the Farnum Building empty. And that may lead to another Boji deal. Truscott says that if the building is up for sale, Boji may be interested in buying it.