Spoke with Steve Archer, the city's director of adminstration today about the big box deal in the works.
He confirms that Lowes or whatever retailer(s) that buy space at the proposed shopping center would pay their full property taxes. HOWEVER, those property taxes would go to pay the costs of roads, parking, water, sewer, etc. required to bring a shopping plaza on that empty site.
For anyone to say that the retailers are not benefiting from the Tax Increment Financing District as described by Archer or anyone else is flat wrong. The developers obvious can price their retail space at a more attractive rate because they don't have to pay a bunch of infrastructure costs.
Another question that bugs me is, TIF districts were meant to redevelop blighted areas. How did a field of grass or wheat become blighted?
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7 comments:
what happens to the upkep on the roads when no rent is collected. Who pays then. We seen this before with Rodeo Meats and we watched that building stand empty and a blight to tis community for 20 plus years. If all fials the ivestors and the profit on shares we will be left holding the bag. Something we hope does not happen but they are not willing to say is a possibility!!!!!
This can be look at just the same way Wichita looked at the Casino's an investment made to our community , but with the major part of the dollars going to somewhere or someone or people who do not even live here, and they more than likely in New York , Chicago,or Japan and China.
What would be real interesting is for them to say where the majority of all products sold there would be coming from and who and where are the people who get the higher paying jobs at this store will be from local or newcomers. It would also be nice if they would or could say that 65% of all goods sold here will be totally made in the UNITED STATES OF AMERICA and 95% of all work is done by US and legal workers in this country. And they would boycot any manufactor who knowingly hires illeagle people to tihs country
David Allen,
I don't know where you got the impression that the area was considered blighted. Possibly from the same people you thought were giving the "home improvement anchor" tax breaks.
That area was established as an "enterprise zone" in the early 90's that made it possible to use redevelopment plans such as TIF.
The fact that the DEVELOPER is getting assistance to create the infrastructure does not in any way diminish the fact that the "home improvement anchor" will have to pay ALL of their taxes. It is true that the "home improvement anchor" will get some small advantage from this, but only a very small portion compared to what the city will save on some of the street improvements previous commission has committed (61st Rd) and the much greater portion towards the rest of the development (about 6 other retailers I if I remember right).
It's a shame that so many facts are left out. There are many more considerations than get published. I hope people will come to the hearing and get ALL of the details.
Yes. Let's be clear.
If it was for local investors to develop all of the stores in Ark City and sell U.S. made products and keep all the money in town, they can start this at any time. I would imagine the same development deals would be available to them too. Knowing Ark City, locals may even get better deals.
I understand the kind of money spent on this will be a sizable fraction of the total assets of some local banks, so I doubt that the funding would be local.
Let's be clear. Development of Ark City will come from outside funding (Wall Street bucks) and the only benefits to the area will be increased employment, income taxes, developer and employee property taxes, development of unused land into an ongoing business, possible population growth, and the recirculation of millions of dollars of payroll within the local community. The development may turn Ark City back into the economic crossroads it used to be instead the Ponca City and Wichita feeder it is today. Sure, the venture may fail, but it won't be without the speculative loss of 10s of millions of dollars by the developers. Just about every advancement in Ark City gets opposed, (apartments, trucking company, processing plant, etc) and there seems to be a mean-spirited mindset that someone from somewhere else attempting to make a profit in Ark City is doing something wrong. If you take away outside investment, (GE, Creekstone, Morton, Rubbermaid, etc) you get a ghost town.
So let's be clear. The developer doesn't have to choose AC. They may have better deals on their desks and may choose one of those if they get static. Remember the personal attacks the trucking guy got? Ark City taxes are a no-brainer for a large business. The fact they are asking for a sweeter deal is no surprise and it isn't being regarded as unreasonable. So let's say they employ 150 people, how much payroll is that? How many homes does that buy? Hamburgers, TV sets, etc.?
Ark City appears to be on an upward spiral now (finally) and this may be just the thing that starts the ball rolling. IMHO
I bounce around several points of this discussion and take my sweet time in doing so:
Enhanced retail options are a step forward for a small community. It is not the strongest enhancement.
I applaud Patrick for offering more insight. There may be some subtle informational details he is missing concerning legislation and use of TIFF.
Arkansas City has, in the past four years taken advantage of expanded definitions of growth and incentive programs for soft projects such as a possible retail center and to encourage upscale housing owners to make improvements.
There is a limit to how much of these benies one can apply within a community. The problem with lowering the threshold and target from aggressively addressing the blight areas originally intended is that we replicate on a smaller scale the same urban decay that took place in metro areas.
By ignoring genuinely blighted areas, both industrial and residential we allow a continuing decay of existing infrastructure. That decay erodes the tax existing tax base. It is a detriment to the appearance of the community. It will create strata and ghetto neighborhoods.
PD will tell you that neglected, ghetto, neighborhoods become havens for crime and public safety issues. Maybe a dentist might explain it this way. It's like ignoring cavities and tooth decay while spending all your dental insurance on tooth whitening treatments. It may look good for a short while but eventually all your teeth fall out.
Can we absorb the potential of increased vacancy rate in the old downtown area? Can new housing areas outweigh continued decline in condition and worth of original township housing areas? Do we extend ourselves fully on incentive-based growth to bring retail jobs (minimum wage to minimum wage plus 10-20%) rather than being more reserved and continuing to pursue industry that might match median income for Kansas?
Remember how we got to the point of economically challenged in southern Cowley. We lost three industrial employers. Then we lost population. Then our retail base began to feel the full effects and inventory declined. Selection declined as storefronts vacated. We changed from 1980’s census of almost as many commuting workers into Cowley as those commuting out of Cowley. In Census 1990 and again in 2000 Cowley’s largest employer was located in Sedgwick County.
AS for TIFF and NRA, building new retail centers while ignoring needs for structural improvement to existing, creating more square footage of retail space while ignoring vacant fairly new retail locations, hoping for resultant new housing developments while ignoring deteriorating existing neighborhoods are all ways to simply shift the existing tax load and municipal costs from old sources to new.
The objective of those incentive programs is to expand the tax base among more population and tax payers. Someone must reserve resources to address improvement of existing infrastructure including older neighborhoods, deteriorating and yet unpaved traffic ways and preservation of industrial space for industry rather than light commercial.
The more liberal use of TIFF and NRA may appeal to some as a convenience tool but municipal revenue growth is optimized via a combination of new growth and reinvestment and refurbishment in existing infrastructure.
WHY??? should mine and everyone elses taxes pay for the parking lot, sewer and water, etc for a big business??? Maybe you should ask the city and find out just how much these things cost before you say WE should pay for it. Does the government help you with those costs when you build a new house or garage? Have you seen them help any of the local small businesses if they try to upgrade or better their little business? No, but when you help these big RICH businesses by doing that, the city raises YOUR sewer and water rates while they continue to coast along with their breaks. Most of the taxpaying public are middle to lower middle class struggling to get by, we watch the big rich businesses get all the breaks, but then we are asked to pay more when the city needs it so where is OUR break? Creekstone not only got a break, but the city extended it another ten years! and Kan Pak and other businesses continue to get breaks while at the same time the city is still raising the costs of those services for the rest of us. Most of these businesses also have a high turnover for some reason or reasons, so they cant be doing too much for their workforce if they are so unhappy they seek other employment, so why reward that anyway? Why should we give out more? To watch our rates get raised again in a few years to help pay the higher costs of supplying these services to them?! Make the guys with the big bucks pay for a change, not us little people who barely make it. We don't need anymore minimum wage paying jobs in this town anyway and with the next raise in minimum wage in 2009, even the city will barely be paying above it! This city needs to be doing things to help the people who actually live and work here that barely eek out a living instead of asking us to help them and their rich cronies with even more of our limited incomes. If they want another store in this town, let them pay for the costs of building it, they will get it ALL back in a short amount of time with the MILLIONS of dollars they claim they will keep here at home and with their minimum wage paying positions. When a big box store is able to build all over the whole country like this, they have got to have a lot of money. Look at the recent reports on Wal Mart and how they have done their employees while they continue to get richer by the billions, and what kind of breaks did we extend them? Our city leaders are supposed to be 'the people' so why would they want to help with this kind of conduct? and then ask us to pay more? somehow this just doesn't sound right, yet it continues to go on not just here but everywhere in government and we the people just stand by and continue to take it.
Well, Patrick, why dont you just tell everyone here 'the facts'. Why don't you tell them just how much money it takes to build just the sewer and water lines (by outside contractors even!). Come on, throw out some figures for us, how many HUNDREDS OF THOUSANDS of our tax dollars? And, while your at it, why don't you tell us why (since you joined the commission) the city suddenly thinks it needs to purchase more from your brothers computer business (you got the memo didn't you?)
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