Sedgwick County seems to be in a rush to make a huge decision that will have far-reaching and long-lasting effects on our county. We don’t have, however, anywhere near all the information we need to make this decision. We need to slow down and decide what role we want to have county government play in economic development.
The stated goal of Sedgwick County’s purchase of the Bel Aire industrial park is to have a site ready for companies of 1,000 or more employees. The Wichita Eagle article Sedgwick County seeks to attract industry with land plan tells us, though, that there are just five or six deals like this each year. Research by the Eagle reporter found more than 100 sites already exist, from all across the country, that meet the necessary criteria. So we’re entering a contest with pretty long odds.
On top of that, according to Sedgwick County, the goal of the industrial park is “to welcome only companies in the composites and alternative-energy fields.” This limits the companies the county would pursue to a number smaller than the five or six deals each year mentioned above.
(It’s worth noting that alternative-energy companies, such as wind turbine companies, exist only because of government subsidy aimed at curing a problem that can’t be fixed. Last year, as the production credit for wind power was about to expire, Congress was told that no further wind power would be developed unless the subsidy was restored.)
If the county asks “do you need rail access?” and it is provided for free, why wouldn’t any company say they need it? I’ve been told, however, that it’s not uncommon for companies to list rail access as part of their requirements, but then never need any rail cars once the facility opens. Some of the industries that composites may be used in are industries like medical devices. These products aren’t shipped by rail.
The issue of needing water and sewer utilities in place before the park can be marketed doesn’t make sense. These utilities could, if government wanted to, be installed very quickly, much faster than a building can be built.
That brings up another point — what about electricity and natural gas service? Depending on the type of industry, these utilities are vitally important. We don’t hear about the lack of these utilities being a problem. The likely reason for this is that electricity and gas are provided by private sector companies (even though most are highly regulated).
If a private utility can provide complicated and expensive electrical service infrastructure quickly to a building, why can’t a government quickly provide water and sewer?
It’s also claimed that the reason Wichita didn’t get the Target Distribution Center a few years ago was the lack of land ready to go. “Shovel ready,” so to speak. But according to reporting in the Topeka Capital-Journal, that city had to use eminent domain to forcibly acquire some of the land needed to assemble the tract.
Topeka used purchase options to secure the availability of land, too. I am told that when this strategy was presented to county staff, they had no idea of what this meant. This is evidence that Sedgwick County is not experienced and equipped to be in the land development business.
If Sedgwick County is determined to proceed and acquire the industrial park, we need to find some way to mitigate the damage to existing real estate developers in the Wichita area. That’s because when government can give away land, when it can dish out tax exemptions and other perks, the private sector is at a severe disadvantage.
Some ideas that have surfaced are these:
- Limit the industrial park to large — very large — buildings only. Don’t allow smaller buildings that compete with what the private sector already has made available.
- Restrict tenants to companies from outside the Wichita metropolitan area.
- When existing Wichita-area companies see the perks — free land, etc. — lavished upon companies that move to the industrial park, they will want the same incentives. These incentives could be made available to companies in all industrial parks in the county. After all, we need to retain existing jobs.
There seems to be a great deal of haste towards making a decision on purchasing this land and the county being in the industrial park development business. This decision process is moving much too quickly. Finding a stable set of facts from which to conduct debate is a problem too, as some of the details in the Sunday Wichita Eagle story are different from what was presented at the commission meeting less than one week before.
A project of this scope would take from four to six months for experienced land developers to consider and perform due diligence. Sedgwick County has been considering this deal for about two weeks. As we’ve seen, the county is in no way experienced in this type of business.