KANSAS CITY, Mo. — Hours before the U.S. House passed its $1.5 trillion tax bill, Kansas City Mayor Sly James urged lawmakers to reject several provisions that he said would “cripple” and slow economic growth in the city, including infrastructure projects.
Among the list of potential projects: the new single-terminal airport at KCI, which voters overwhelmingly approved last week.
“We need an agenda to revitalize and restore the infrastructure of our cities, not cripple future investment in our town,” James said in a statement.
Republicans, who currently control the U.S. House and Senate have pushed for tax reform this year. On Thursday, the Republican-controlled House passed its version of the tax bill mostly along party lines, 227-205.
The House version would repeal Private Activity Bonds (PAB), which are issued by state and local governments and are currently tax-exempt. Kansas City and Edgemoor Infrastructure & Real Estate are currently contemplating using PABs to pay for KCI.
“When they are non-taxable, non-taxable bonds are cheaper for the city and for organizations to issue. And the cheaper the dollar, the more dollars we have to spend on other projects," said Kansas City’s Aviation Director Pat Klein.
If PABs are terminated, projects like KCI would still move forward. However, the city warns infrastructure projects will become more expensive.
HOW LOCAL LAWMAKERS VOTED:
- Rep. Emanuel Cleaver — NO
- Rep. Sam Graves — YES
- Rep. Vicky Hartzler — YES
- Rep. Lynn Jenkins — YES
- Rep. Kevin Yoder — YES
Klein told 41 Action News KCI could cost an estimated additional $6 to $12 million a year if the PABs are eliminated like the House tax bill calls for.
“What would end up happening is the city along with Edgemoor and the airlines would sit down and say, ‘Ok, we just had an impact on us from the federal tax legislation. How do we handle it?’ And that’s a discussion we don’t want to face,” Klein said.
The Senate now has to take up its version of the tax bill, which keeps PABs intact. In the meantime, city leaders including James have been lobbying lawmakers asking them to keep its PAB provision intact.
