Happy Fourth, everyone. We’re having a party tonight, and I’m putting on a gigantic fireworks display in the Romanelli West neighborhood, so if you’re in the neighborhood and hear sirens, you’ll know what’s going on. I’m sure even the KCMO cops won’t be able to ignore the blockbuster demonstration I have planned.
…But anyway, I’ve got other things on my mind, too.
Like, how about that Steve Vockrodt story on The Star’s front page today? It was a nearly 70-inch takeout on Kansas City Councilman Quinton Lucas’ valiant attempt to get his council colleagues to pass an ordinance that would significantly limit tax abatement. Overly generous tax abatements for developers has become, after many years of tolerance, a matter of keen public interest. But public interest will fade, of course, unless relevant aspects of a situation are highlighted in the press.
And that’s where Vockrodt, who just joined The Star’s staff June 1 after several years at The Pitch, provided a big public service today: He put a bright light on Lucas’ effort to rein in a tax-abatement scheme that has gone on way too long.
Just as surely as a majority of Kansas Citians don’t want a new single-terminal airport, a majority is strong opposed to the current tax-abatement system, which developers, lawyers, architects, engineers and others have utilized to line their pockets for many years and build projects in areas that should not qualify for public supplements. The system came to a head earlier this year when opposition erupted over the Helzberg plan to refurbish a warehouse in the booming Crossroads Arts District and convert it into headquarters for the BNIM architecture firm.
Promoters dropped the project after several people, including my friend Clinton Adams of Freedom Inc., organized and pursued an initiative petition to deny tax increment financing for the project.
In the wake of that, the development “community” assumed a lower profile, hoping public attention would fade and time would reinstate the lucrative status quo. In May, however, Lucas, whose 3rd District is starved for redevelopment projects, introduced an ordinance that, in general, would reduce the amount of tax abatement or tax redirection” by 25 percent.
Vockrodt clearly explained it like this…
For example, a standard inducement offered by the Planned Industrial Expansion Authority abates as much as 100 percent of property tax increases on development projects for the first 10 years after approval, and then by 50 percent for the following 15 years. Under Lucas’ bill, the expansion authority could abate 75 percent of those taxes for 10 years, then 37.5 percent for 15 years.
It would affect tax increment financing, another popular incentive program. Under normal circumstances, TIF captures 100 percent of increases in property taxes generated by a development project, along with 50 percent of economic activity taxes (earnings, sales and utility taxes) and makes them available to reimburse developers. Under Lucas’ ordinance, property tax redirections would be limited to 75 percent, and economic activity tax redirection would fall to 37.5 percent.
Reading along on this story, I thought Lucas might be a lone tree trimmer out on a long limb, but, no, his ordinance has six co-sponsors: Teresa Loar, Katheryn Shields, Jermaine Reed, Alissia Cannady, Heather Hall and Lee Barnes. Seven votes is all it takes to pass an ordinance, but it’s not as easy at is sounds, especially when you’re taking on powerful vested interests who exercise their power partly through the political lifeline of campaign contributions.
A key councilman who is delaying action on Lucas’ ordinance is Scott Taylor, chairman of the Planning, Zoning & Economic Development Committee. It is through that committee that Lucas’ ordinance must travel to get before the full council. But Taylor has refused to schedule a committee hearing on the ordinance, saying, “We definitely don’t want to implement something that would shut down the economy, as we’re creating a lot of new activity, jobs and new investment in Kansas City…”
Let’s hope Lucas and his co-sponsors are able to keep up the pressure and get this ordinance passed — and that Mayor Sly James doesn’t veto it. It’s a good start at reining in an inequitable system that has endured too long.
My only qualm about the tax-abatement story is the headline in the print edition. It says, “Fight to lessen tax cuts is long, lonely”
I read that headline several times, and it sounded like a battle was afoot to keep taxes high. It’s confusing and should not have run that way. The headline in the online version was much more precise: “Will KC get a law to rein in development incentives? Once councilman is trying”
I understand that the person who wrote the headline for the print edition was limited to one column, and that is certainly challenging…Nevertheless, it could have been much clearer.