Much Of Kansas City's Development Receives Tax Breaks. Voters Could Scale Them Back | KCUR

Much Of Kansas City's Development Receives Tax Breaks. Voters Could Scale Them Back

May 27, 2019

Kansas City, Missouri, voters will elect a new mayor and city council next month. But it's a lesser-known ballot measure that could have a bigger effect on the city's economic development.

Question 1 would cap at the amount of tax incentives the city can award developers at 50%. These incentives can take several forms; often, the city freezes property taxes at the level before the development or redirects a percentage of property taxes back to the project.

The Coalition for Kansas City Economic Development Reform collected enough signatures to put the measure before voters.

Standing outside The Grand on 11th Street and Grand Boulevard, Jan Parks says she opposes awarding tax breaks to build luxury apartments and hotels.
Credit Lisa Rodriguez / KCUR 89.3

Standing outside The Grand earlier this month, spokeswoman Jan Parks lamented the tax breaks given to the luxury project, which includes a pet spa, the city’s highest rooftop pool, a movie theater and yoga studio.

“I guess from our standpoint, we look at it from the side that we have residents with no water in their houses," she said. "We have school buildings that desperately need repair. And do we really need this level of luxury?”

The group argues that luxury hotels are getting subsidized by the city at the expense of schools, libraries and mental health funds, all of which rely on property tax revenue.

Both candidates for mayor oppose the 50% cap. Councilwoman Jolie Justus says tax incentives are an important tool to stimulate economic activity in parts of the city that need it.

“So that when we have an exciting opportunity that can create high paying jobs, that can build affordable housing next to a transit line, that can build affordable housing next to job centers and educational opportunities — I want to make sure that we have every tool available so that we don't miss out to Grandview or Raytown or Kansas,” Justus said.

Her opponent, Councilman Quinton Lucas, said he understands where petitioners are coming from.

“If you're waking up in east Kansas City right now and everybody basically tells you that trickle down economic development will work for you someday … you may say hogwash,” Lucas said.

Still, he thinks the measure is too restrictive, because: “It doesn't exempt development in Kansas City's poorest neighborhoods. It doesn't create flexibility for the construction of things we need — health care facilities, affordable housing, etc.”

Lucas also argues the current 75% cap, which he introduced in 2016, still needs time to work.

The ballot measure doesn’t include exceptions for projects in truly blighted areas, something Parks regrets.

“I mean that’s been our whole intention for doing this,” she says.

But, she said, the city council could go back and add them in if the measure passes.

Richard Martin is the chairman of the campaign against Question 1. He's also director of government affairs at construction company JE Dunn, which helped build some of the Power and Light District, but did not speak on behalf of the company. 

“If the voters passed something, it's not likely that you're going to have a new council immediately want to take up something and undo what the voters just approved,” Martin said.

He also said a 50% cap would discourage developers from considering Kansas City and make it more difficult for the next mayor from making good on campaign promises like creating affordable housing.  

“Without economic development, without new projects, there will be no affordable housing developed in Kansas City,” Martin said.

Election Day is June 18.

Lisa Rodriguez is a reporter and the afternoon newscaster at KCUR 89.3. Follow her on Twitter @larodrig.