KANSAS CITY, Mo. — Development is booming in downtown Kansas City, Missouri, but the fight over how much developers receive in tax incentives is every bit as brisk.
Currently, a coalition of community organizations is petitioning the city to cap the amount of money shelled out in tax-increment financing or other development incentives.
KCMO Councilwoman Teresa Loar has a different idea. Facing competition from other cities in the region, especially those right across the state line in Kansas, she doesn't want to undercut Kansas City's ability to attract businesses and grow its tax base.
“We're already struggling with new development coming into the city,” Loar said.
Her proposed ordinance would maintain the status quo of available incentive packages and prevent lowering a cap on TIF allowances from 75% to 50%, which the Coalition for Kansas City Economic Development Reform has propsed.
Developers use the tax abatements to pay for things such as street lights, roads, sewer and concrete work — things for which many municiaplties in Johnson County, Kansas, are willing to give 100% abatements.
“We are living next door to one of the wealthiest, if not the wealthiest, county in the country — Johnson County, Kansas," Loar said. "If we implement a policy that disables growth and
economic development in Kansas City, it will all go to Johnson County."
KCMO already missed out on some big opportunities, according to Loar, whoi cited Kansas Speedway as a prime example.
“We were in competition with Kansas, KCK, and they had the better incentive package and that's where it went," she said. "I'm sure that's why Legends (Outlet Mall) is out there, the soccer stadium (Children's Mercy Park)."
Loar understands her proposal may be a hard sell to many voters.
“I know voters have a perception that all TIF, all tax increment financing, all tax incentives are bad," she said. "They truly are not. We are very careful on how we give out incentives."
Some Kansas Citians think Loar's proposal is reasonable.
Resident Schrell Hollands believes such incentives are necessary to attract development, which boosts job growth and ultimately provides "things for young people to do."
Opponents argue the city should focus on fixing other parts of Kansas City, like the east side, rather than handing out tax breaks to already wealthy developers.
“I'm not trying to give people anymore than they deserve, that's for certain, but these developers have a choice and they can go elsewhere,” Loar said.
Loar said they missed the deadline for the proposal to be on the June ballot, but there could be a special election in August, which the other petitioners who want to lower the incentives already have enough signatures to do.
