STAR bonds Archives - Voice For Liberty

Feb

Wichita taxing district to expand

The City of Wichita plans to expand a special tax district. Next week the Wichita City Council will consider expanding an existing CID, or Community Improvement District, in the Delano neighborhood near downtown Wichita. A map provided by the city is nearby. Community Improvement Districts are a mechanism whereby extra sales tax is collected within a district. For this CID, the city asks to collect an extra two cents per dollar, which is the maximum allowed in Kansas. CIDs are distinguished from STAR bonds, in which incremental sales tax revenue in a district is captured and handled differently from the…

Mar

By Bob Weeks

Wichita considers a new stadium

The City of Wichita plans subsidized development of a sports facility as an economic driver. Originally published in July 2017. This week the Wichita City Council will consider a project plan for a redevelopment district near Downtown Wichita. It is largely financed by Tax Increment Financing and STAR bonds. Both divert future incremental tax revenue to pay for various things within the district.[1. Weeks, Bob. STAR bonds in Kansas. Available at https://wichitaliberty.org/kansas-government/star-bonds-kansas/.] [1. Weeks, Bob. Wichita TIF projects: some background. Available at https://wichitaliberty.org/wichita-government/wichita-tif-projects-background/.] City documents promise this: "The City plans to substantially rehabilitate or replace Lawrence-Dumont Stadium into a multi-sport…

From Pachyderm: Economic development incentives

Oct

By Bob Weeks

From Pachyderm: Economic development incentives

A look at some of the large economic development programs in Wichita and Kansas. Here's video of a presentation I gave at the Wichita Pachyderm Club this week on economic development incentives. The video was produced by Paul Soutar of Graphic Lens. View below, or click here to view at YouTube. Following, articles that address some of the topics I presented: Industrial revenue bonds in Kansas: Industrial Revenue Bonds are a mechanism that Kansas cities and counties use to allow companies to avoid paying property and sales taxes. Wichita TIF projects: some background: Tax increment financing disrupts the usual flow…

Apr

By Bob Weeks

In Wichita, spending semi-secret

The Wichita City Council authorized the spending of a lot of money without discussion. At its March 27, 2018 meeting, the Wichita City Council passed a resolution authorizing the spending of funds for the River Vista development on the west bank of the Arkansas River in downtown. The agenda packet for the meeting gave the details: "The overall project budget is $7,862,999 with STAR Bonds financing $4,750,000 of the costs and the City financing $1,050,000. The balance of the project costs will be assessed against the Improvement District." (STAR bonds are a mechanism whereby future sales tax revenue is routed…

In Wichita, new stadium to be considered

Jul

By Bob Weeks

In Wichita, new stadium to be considered

The City of Wichita plans subsidized development of a sports facility as an economic driver. This week the Wichita City Council will consider a project plan for a redevelopment district near Downtown Wichita. It is largely financed by Tax Increment Financing and STAR bonds. Both divert future incremental tax revenue to pay for various things within the district.[1. Weeks, Bob. STAR bonds in Kansas. Available at https://wichitaliberty.org/kansas-government/star-bonds-kansas/.] [1. Weeks, Bob. Wichita TIF projects: some background. Available at https://wichitaliberty.org/wichita-government/wichita-tif-projects-background/.] City documents promise this: "The City plans to substantially rehabilitate or replace Lawrence-Dumont Stadium into a multi-sport athletic complex. The TIF project…

On Wichita’s STAR bond promise, we’ve heard it before

May

By Bob Weeks

On Wichita’s STAR bond promise, we’ve heard it before

Are the City of Wichita's projections regarding subsidized development as an economic driver believable? This week the Wichita City Council will consider a project plan for a STAR bonds district near Downtown Wichita. These bonds divert future incremental sales tax revenue to pay for various things within the district.[1. Weeks, Bob. STAR bonds in Kansas. Available at https://wichitaliberty.org/kansas-government/star-bonds-kansas/.] City documents promise this: "The City plans to substantially rehabilitate or replace Lawrence Dumont Stadium as a modern multi-sport stadium as part of a larger project to develop the river and stadium areas. ... Combined, the museum, pedestrian bridge, waterfront improvements and…

May

By Bob Weeks

Kansas economic development programs

Explaining common economic development programs in Kansas. TIF projects: Some background Tax increment financing disrupts the usual flow of tax dollars, routing funds away from cash-strapped cities, counties, and schools back to the TIF-financed development. TIF creates distortions in the way cities develop, and researchers find that the use of TIF means lower economic growth. Click here. Tax increment financing (TIF) resources Resources on tax increment financing (TIF) districts. Click here. STAR bonds in Kansas The Kansas STAR bonds program provides a mechanism for spending by autopilot, without specific appropriation by the legislature. Click here. Industrial Revenue Bonds in Kansas…

In Wichita, an incomplete economic development analysis

Aug

By Bob Weeks

In Wichita, an incomplete economic development analysis

The Wichita City Council will consider an economic development incentive based on an analysis that is nowhere near complete. Tomorrow the Wichita City Council will consider granting a sales tax exemption for a real estate development in northeast Wichita. (For background, see In Wichita, benefitting from your sales taxes, but not paying their own.) As evidence of the goodness of the project and why the city should forego collecting sales tax, the council has been presented with these benefit-cost figures: City of Wichita General Fund: 44.67 to 1 City of Wichita Debt Service Fund: NA Sedgwick County: 100.23 to 1…

In Wichita, benefitting from your sales taxes, but not paying their own

Aug

By Bob Weeks

In Wichita, benefitting from your sales taxes, but not paying their own

A Wichita real estate development benefits from the sales taxes you pay, but doesn't want to pay themselves. In Kansas, the STAR bond program allows cities to issue bonds (that is, to borrow money), give the proceeds (that is, cash) to a private business firm, and then pay off the bonds with the sales taxes paid by the business firm's customers. But sometimes this gift by taxpayers isn't sufficient. In Wichita, despite benefitting from STAR bonds, a company wishes to skip paying sales taxes itself. This is what the Wichita City Council will consider tomorrow. The Wichita Sports Forum (WSF)…

Feb

By Bob Weeks

STAR bonds in Kansas

The Kansas STAR bonds program provides a mechanism for spending by autopilot, without specific appropriation by the legislature. Under the State of Kansas STAR bonds program, cities sell bonds and turn over the proceeds to a developer of a project. As bond payments become due, incremental sales tax revenue make the payments. It's only the increment in sales tax that is eligible to be diverted to bond payments. This increment is calculated by first determining a base level of sales for the district. Then, as new development comes online -- or as sales rise at existing merchants -- the increased…