The state of Kansas spent nearly $1.5 billion in the past five years on various “economic development†projects, but it’s hard to point to clear economic benefits from the spending, according to a Legislative Division of Post Audit study.
From 2003 through 2007, the state agencies spent about $630,000 on “economic development†— most of that federal dollars. The state also had $860,000 in “forgone revenue†from tax credits, according to the study. And the figure doesn’t count the loss of some $400,000 in the next five years from the repeal of the state business machinery and equipment property tax, which was designed to spur economic growth.
What are taxpayers getting for the investment? It’s hard to quantify, because of the difficulty of tracing a direct cause-and-effect relationship between the spending and economic growth.
“A billion and a half dollars is a lot of money to put on the table without being certain what you’re getting in return,†noted state Senate Majority Leader Derek Schmidt, R-Independence.
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And where is the giant windfall of millions of dollars for economic development from the Kansas Lottery? Most Kansans thought and still think this money goes to Kansas schools rather than to an economic development slush fund which produces few tangible results. Perhaps its time to finance another expensive “Kansas, as far as you can blow tax money,” motto. Or more travel money for the Governor.
Easy, put the name of people who are passing out special deals, passing out checks and generally giving economic advantage, right on the economic development package.
That way, if a question is needed to be asked, then a person name, the company name, all involved are right in paper work.
It’s better than just saying, “here’s free money, go out and spend it, we don’t care.”
Now Regular, you Pubes would never go for accountability and you know it.
“And the figure doesn’t count the loss of some $400,000 in the next five years from the repeal of the state business machinery and equipment property tax, which was designed to spur economic growth.”
It would be a loss, if the economy was static.
This tax repeal will pay for itself. It’s not a loss. Wise up, Libs.
Will be nice when we get a sign-in.
Punks like pfeefer and phantom won’t be able to plague the blog with thousand and one nics like Sara Bellum et al.
You cannot spend yourself into prosperity. Why is it most people know this about their personal lives but somehow the government is supposed to be able to pull it off?
I think you guy forgot some zeros:
“From 2003 through 2007, the state agencies spent about $630,000 on “economic development” — most of that federal dollars. The state also had $860,000 in “forgone revenue” from tax credits, according to the study. And the figure doesn’t count the loss of some $400,000 in the next five years from the repeal of the state business machinery and equipment property tax, which was designed to spur economic growth.”
Should be $630,000,000; $860,000,000; $400,000,000 Details, I know but lets get the real money in here.
Fleetwood: You need to read the report. It says “The audit found that most studies showed few achieved results from economic development assistance.
“The literature we reviewed concluded that, thus far, negative and inconclusive findings are far more numerous than positive findings,” the audit said.
Promised jobs weren’t created, return on investment was low or negative, or the incentives offered weren’t a determining factor, the audit said.
Fleet, I think it is you who needs to wake up and get the clue.
Whatever the amount, I suppose it would have been money well spent if Boeing/Kansas had received the “tanker deal.” But as usual, the money was spent by those who had the least influence on the decision.
Governor Sebelius, of course, was too busy creating idiotic “board games,” making fun of incarcerated prisoners. All handled with her son out of the taxpayer-owned Governors mansion in west Topeka.
Does anything make sense anymore when it comes to government?
“What are taxpayers getting for the investment?”
Oh I don’t know.
What does the public get out of it when some skinflint gets to keep all his nickles and dimes?
The population of Kansas is almost 3 million.
We spent 1.5 billion for economic developement.
Why not just give us the money? Or, at least, let us keep it.
The problem with trying to figure out what would have happened, if nothing had been done, if NO incentives had been offered, is this:
We do not know what would have happened.
Our economy could, perhaps, be worse had we not taken these actions.
You better believe that Airbus has all kinds of tax breaks and subsidies.
Wichita is in a “twilight zone”, because the people who make our city’s foundational decisions don’t live here. Suppose that Boeing had won the tanker contract. It wouldn’t have been due to Wichita aircraft people, it would have been based on Seattle and Chicago engineers and marketing people proposing as good a proposal than the Airbus / Northrop Grumman people.
This is the problem with a subservient satellite economy. Seattle has moved on. It lost shipbuilding 30 years ago to Asia. Timber is no longer the king jobs-maker. At some point you have to either envision your own destiny, or let others abuse you, because you don’t have any vision.
I have a friend who would be the best math teacher in Wichita for our city’s gifted kids. But anti-Asian prejudice and foot-shooting teacher unionists won’t let it happen. I could be a superb math and science teacher for our gifted kids. But you let dummkopfs run the education system. They set rules and enforce an ideology that makes Wichita a Rust Belt town. You need strong math and science programs. The people running education here don’t know math and science.
You don’t have any interest in nurturing young talent, and without that, this city’s future is dark gray. Wait until China figures out how to manufacture small aircraft for half the cost of Wichita. Like 2020. Goodnight Wichita.
The best economic development tool is good education and good infrastructure. Then we can offer a quality workforce and business environment.
Poster, Fleetw, MPS and Ben: The dollar figures in Randy Scholfield’s opening paragraph do appear to be mis-quoted somehow. Posterboy’s correction at 8:40 AM appears to be more nearly correct.
Fleetwood then suggests giving back the 1.5 billion dollars earmarked for Kansas economic development to the 3,000,000 residents of Kansas. That would return $500 to every man, woman and child in Kansas. Every Kansas four-member family would receive $2,000 instead of contributing that $2,000 to the Governor for her misguided economic development vision that doesn’t work.
Ask Boeing/Kansas employees.
Looks like we need to be wooing Airbus!
Phantom – too late. Alabama and other states beat us to it. Their investments in education and infrastructure are paying off.
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[...] WE Blog » The Wichita Eagle Editorial Department Blog wrote an interesting post today on Does economic development pay off?Here’s a quick excerptDoes economic development pay off? Posted6:01 a.m. The state of Kansas spent nearly $1.5 billion in the past five years on various “economic development” projects, but it’s hard to point to clear economic benefits from the spending, according to a Legislative Division of Post Audit study. From 2003 through 2007, the state agencies spent about $630,000 on “economic development” — most of that federal dollars. The state also had $860,000 in “forgone revenue” from tax credits, according to the s [...]
Math Property…
Thanks for this post!…