My colleague Mark McCormick penned an outstanding column this morning on Karl Peterjohn’s defeat of longtime Sedgwick County Commissioner Tom Winters. It’s must reading for everyone worried about their taxes, and everyone who ought to be worried about the long-term health of the Wichita economy.
Here’s the point that I wonder how many of the anti-tax crowd grasp: Economic development isn’t a spectator sport. It’s a full-contact sport populated by cities and states with large war chests that want our businesses, including our aviation anchors. We don’t set the market for prosperous businesses in Wichita; we participate in it.
No one can or should enjoy taxation. But is there anyone among us who wants to stand by and ogle a lower bill from the appraiser while watching the Cessna moving vans drive by on their way to North Carolina?
We’ve tried to make the point in the Eagle – several times – that the nationwide competition for industry has never been hotter. Cities and states want our airplane makers, not to mention other businesses, and they’re prepared to pay for them. Apparently we’ve failed.
There’s a balance out there that will have to be achieved between reckless government spending and equally reckless anti-taxation zealots. Or Wichita will suffer. Mightily.
15 Comments
“There’s a balance out there that will have to be achieved between reckless government spending and equally reckless anti-taxation zealots.”
I agree. That is why I support school bond issues and supported Vo-Tech’s efforts to not be eviscerated several years ago. However, the Arena crossed the line to reckless; that will likely haunt local politics for many years. This has created a substantial level of distrust toward both County and City leadership. Remember, last election cycle two incumbent Commissioners were turned out.
This distrust also was a factor in the defeat of the casino proposal last year. Without a concrete proposal of where and what we were told “trust ut.” Also, “Vote Yes Yes” began to sound a lot like “Vote Yea Rah”
Wichita and Sedgwick County needs a voice to state a differing opinion on the direction of local government. I hope Mr. Peterjohn has that voice.
I think it’s to everyone’s advantage to have full, transparent discourse PRIOR to voting.
Who knows? Maybe these blogs become a forum for those types of issues!
In the spirit of full disclosure, I’m not an arena critic. I’m quite confident, actually, that the arena will prove itself an asset to Wichita.
But with that said, I think the point Mark made that I’m trying to reinforce is this: Economic development can’t happen in today’s climate with the taxpayer on the sidelines.
It’s a wonderful thought that business should create its own incentives to stay or go, but it’s unrealistic in today’s competitive climate. Dissent is an essential part of our form of government, and it’s got a place in the community’s policy dialogue – as long as it doesn’t evolve into zealotry.
It’s fine to keep spending down. But not out. We can and should be vigilant about how our tax dollars are spent. We should never become obsessed with preventing their expenditure.
I ’sort of’ agree. Where we part company is when we subsidize one local business at the expense of another. For example – subsidizing sports bars in Old Town with taxes collected from Players out northwest. Ot Gander Mountain at the expense of Dick’s, Sheplers, etc. If you look carefully at the economic analysis of these you will find that all we are doing is re-arranging WHERE entertainment money os spent within Sedgwick County – not increasing anything.
I fear that you are correct that taxpayers are retreating to the sidelines. And I am not a supporter of Karl (although we are friends). But I do think that our current leadership (sic) has so alienated the public that there will be bad consequences.
Our hope now is that Marcey Gregory wins in November. As a successful business person and small town mayor she might bring some new ideas to the Commission. And, as a business person she knows you have to both keep spending in check but also ’spend money to make money’.
It will be an interesting race out in my part of the County.
We really don’t part company, save the merits of the question, “To what extreme does city government go to breathe some life into downtown?”
Former GWEDC chief Dave Wood called the dilemma you note the “transferral effect.” No new money, just the same money headed to different places.
The notion that tax money has a limited place in economic development is a legitimate subject for discussion. I think you can argue that the city needs to incentivize downtown redevelopment. To what extent should make a lively policy discussion.
The notion that it has no place in economic development will damage Wichita’s economy.
I frankly believe that McCormick’s column is a complete over-reaction to a democratic process. I don’t recall Lambke being the “yes-man” of city council either. Perhaps Gray will carry the torch.
“Economic development can’t happen in today’s climate with the taxpayer on the sidelines.”
I agree completely with this. But taxpayers cannot fund unlimited economic development.
Paying $6,000,000.00 to clean up the Warren Theater TIF situation was a mistake. Yes, it was the cleanest way to absolve the mess, but the mistake should have never happened. The Waterwalk should have NEVER been authorized without Bass Pro Shop being the anchor tenant. The downtown arena location should have NEVER been discussed until all land was acquired. Exploration Place and Cowtown’s business plans should have been scrutinized by on outside, independent accounting firm like AGH. And I am definitely weary of the recently passed arena zone TIF.
More transparency. Less conflicts of interest. More accountability to taxpayers.
That is NOT zealotry.
If that’s where it stops, Jerry, I agree.
If …
My concern, quite frankly, is with an environment where support for a major economic development driver – which is exactly what the Jabara tech ed center is – could cost a politician their seat. Jabara is tax money well spent.
I love this blog!
There has been reports that State or local incentives to recruit companies or the level of taxation has very little to do with companies locating.
Other than extreme taxation and heavy regulation, which will deter and even have business leave the area, the things a company looks for is: An educated work force, amenities of the area (i.e. the downtown arena is a huge + for us), low crime (something we really need to work for), and the general attitude of the people that live here.
If we really want to do good for our community we really need to focus on lowering crime and bringing about a unity positive attitude for our community. Wichita needs an identity, and it is getting there. But we can do more and it doesn’t really take more taxation to do it.
Lower the crime substantially and build a positive identity for Wichita and business will come.
Karl Peterjohn will serve the county well. He isn’t a zealot as everything thinks he is. A zealot is somebody like Ms. Stuart in Park City. That is somebody we don’t need in Wichita or Sedgwick Co. government.
I think it was Des Moines I read about in the Washington Post some years back. They took the approach of focusing on education/training. Develop your work force for high-value-added jobs and the companies will come in to take advantage of that work force.
The ‘Think in Green’ sessions we had here presented a lot of evidence that educated workers want amenities including outdoor recreaton. Improving our river front and bike/hiking trails support that. I have been told by personnel people at local companies that prospective employees ask about such things.
My only beef with the Jabara facility is its narrow focus. We need to be diversifying away from over-reliance on aircraft. And I guess I am still a bit angered over the evisceration of Vo-Tech; including its aircraft programs. Why didn’t we build upon what we already had?
I also question the VERY job-specific training we seem to be heading to at Jabara. Having been involved in education/training for many years it is my position that we (the public) provide a strong basic foundation and then the employer provides the specifics of special machines etc. As a community we should be preparing our workers to fill MANY possible positions; not just one.
What happens when Boeing out-sources to China and their workers are so narrow they cannot transfer their skills to elsewhere? I want Boeing to have made that NARROW investment; I want to make the investment that allows them to move elsewhere and continue paying taxes.
Now, for a possible product that we should be building here – an item often bought overseas and whose demand is increasing. It is related to aircraft in that it requires the combination of strength and light weight. Aerodynamic design. Looks like a giant airplane propellor. WIND TURBINES! We should be building them here to exploit the “Saudi Arabia of Wind” that we sit in the middle of.
Couple of comments:
I disagree strongly with any suggestion that economic incentives have little to do with company relocation. There’s a boatload of evidence out there – including reporting we’ve done in the Eagle – that suggests that our neighbors have more money and more incentives to attract business than we do.
One recent example – albeit apparently unsuccessful – comes to mind: When SemGroup – now in the bankruptcy headlines – bought Koch’s asphalt operation and moved most of it to Tulsa, it received a seven-figure annual payroll rebate from the state.
BTH, you raise several legitimate points: Jabara does appear tailored – at least in its formative stage – toward aviation. However, again referencing stories we’ve written, the competition for airplane builders is intense and laden with money. It’s clear that we’re going to lose some of the major builders if we don’t prepare a workforce to address the onslaught of baby boomer retirements they face.
Jabara’s long-term future, though, is exactly what you suggest. It’s hard for me to find fault with addressing an acute aviation need first, however.
Vo-tech is another issue, one built around leadership issues, it would appear.
Bill,
I am curious of your opinion on the new Ken Mar TIF passed by the council. Also, do you believe there is a conflict of interest regarding Kevass Harding?
Thanks
Jerry,
Having been to Ken Mar recently – and with the disclosure that I appreciate the historical and cultural significance of the area – I believe the Ken Mar TIF is one of the best-intentioned that the city has created. Unlike many in town, this one does appear consistent with the definition of a TIF – the redirection of tax revenues to improve a blighted area.
You might recall the the Maize IMAX theater idea died because the city couldn’t bring itself to declare an empty wheat field along K-96 a blighted area. It’s reassuring to find a governmental body with a conscience, isn’t it? In a nutshell, I see Ken Mar as a perfect spot for a TIF.
I’m not sure what you mean by a conflict of interest with Mr. Harding. His interest in the property has had more than a year to be vetted. Tell me more about what you mean.
Bill – I agree. I see the KenMar one as similar to the Hillside TIF by Wesley. Driven not by a few eclectic over-proced bars but by genuine commercial enterprises.
Thank you for the response. I’ll address Mr. Harding first. I have a rule of thumb I try to live by that states “if it can appear as a conflict of interest, treat it as it is a conflict of interest”.
Numerous comments have been made in this paper regarding the electorate being ignorant on City/County issues being the reason Tom Winters lost. While Mr. Harding may have been totally vetted (and I trust your opinion on that Bill) it simply does not pass the smell test. This is exactly how good people lose elected office.
TIF seems to be the flavor of the moment in the Wichita area and this concerns me greatly. This is a very slippery slope in which the more I am exposed to it the more I am against it.
My greatest concern is the council lacking the business acumen to make such decisions. I would like to see at a minimum a transparant meeting with the council and numerous local business members and academia to discuss the pros and cons of any TIF transaction. What is the business model? what is the marketing plan? What is the employment outlook? The number one question to me anyway is what is the ROI (return on investment)?
At the same time an independent accounting firm (preferably local) presents their review of the data presented.
That being said the numbers should meet established goals and criteria prior to reaching the council level. This combined with an EXACTING standard on what constitutes a blighted area or an area of historical significance should lead to the councils’ vote.
In closing I am absolutely in favor of economic development, however I feel there must be a strict justification process that the council needs to adhere to for these types of transactions.