Community Improvement Districts

Economic development planning in Wichita on tap

Tuesday's meeting of the Wichita City Council features four public hearings concerning Community Improvement Districts. One CID also will have a public hearing on its application for tax increment financing (TIF). CIDs are a creation of the Kansas Legislature from the 2009 session. They allow merchants in a district to collect additional sales tax of up to two cents per dollar. The extra sales tax is used for the exclusive benefit of the CID. Under tax increment financing (TIF), developers get to use their property taxes to pay for the same infrastructure (or other costs) that everyone else has to…
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For downtown Wichita, Mayor Brewer has a vision

In Sunday's Wichita Eagle, Wichita Mayor Carl Brewer penned a piece that states his belief in the importance of downtown and prepares the people of Wichita for the start of a prescriptive planning process, with accompanying subsidy to politically-favored developers willing to fulfill the plan. The mayor used the word "vibrant" twice. Asking citizens a question like "Would you like to have a vibrant downtown?" is meaningless. Who doesn't? It's only when the question is accompanied by context that citizens can start to understand how they should answer. For example, in the mayor's article, he mentions the use of special…
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More intervention for Wichita proposed

Tomorrow the Wichita City Council will consider accepting petitions for the formation of another Community Improvement District. In this case the applicant is the Broadview Hotel in downtown Wichita. This hotel is already the recipient of potentially $4.75 million in Kansas historic preservation tax credits. Despite the name of the program, the tax credits are in effect a grant of money to the developers. Now the hotel seeks permission to charge extra sales tax for its own benefit. The action the council may take tomorrow is on the consent agenda, as noticed by the Wichita Eagle's Brent Wistrom. The consent…
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Wichita Community Improvement District approvals signal increased interventionism

Yesterday's action by the Wichita City Council in approving two Community Improvement Districts signals a new era in increased intervention in free markets by Wichita politicians and bureaucrats. CIDs are a creation of the Kansas Legislature from the 2009 session. They allow merchants in a district to collect additional sales tax of up to two cents per dollar. The extra sales tax is used for the exclusive benefit of the CID. Although at past city council meetings some members seemed as though they might view the districts with skepticism, there was little meaningful discussion, and no council members voted against…
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More Wichita Community Improvement Districts proposed

Tomorrow's meeting of the Wichita City Council will consider starting the process for the approval of three Community Improvement Districts in Wichita. CIDs are a creation of the Kansas Legislature from the 2009 session. They allow merchants in a district to collect additional sales tax of up to two cents per dollar. The extra sales tax is used for the exclusive benefit of the CID. CIDs may work in one of two ways: First, the city might sell special obligation bonds, give the money to the applicant, and pay off the bonds with the extra sales tax that is collected.…
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Community Improvement Districts discussed in Wichita

At yesterday's meeting of the Wichita City Council, council members approved the start of the process to create two Community Improvement Districts in Wichita. Yesterday's action sets August 10 as the date for a public hearing. CIDs are a creation of the Kansas Legislature from last year. They allow merchants in a geographic district to collect additional sales tax of up to two cents per dollar. The extra sales tax is used for the exclusive benefit of the CID. More background may be read in the article Wichita community improvement districts should have warning signs. In my remarks to the…
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Wichita should follow Lawrence’s lead in tax warnings

Is there a point where sales taxes become so high that consumers need to be warned? Sales tax is already high in the northeast Kansas college town of Lawrence, home to the University of Kansas Jayhawks. After July 1, the combined sales tax rate -- state, county, and city -- will be 8.85 percent. Lawrence has two districts where an extra one cent per dollar is added to that. Like Wichita, Lawrence is considering creating Community Improvement Districts, where merchants add up to another two cents per dollar in sales tax. The proceeds of that extra sales tax go to…
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Wichita community improvement district questions unanswered

This week the Wichita city council approved the use of Community Improvement Districts. These districts are a new creation of the Kansas legislature from last year. In a CID, merchants may charge additional sales tax, up to an extra two cents per dollar. Sometimes bonds might be sold by the city with the bond proceeds being given to the occupants of the district. Then the bonds are repaid by the extra sales tax collected. Or, the extra sales tax might simply be given to the occupants of the district, after deduction of a small amount for expenses. A presentation created…
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