Tax abatements Archives - Page 3 of 13 Voice For Liberty

Aug

Wichita Business Journal reporting misses the point

Reporting by the Wichita Business Journal regarding economic development incentives in Wichita makes a big mistake in overlooking where the real money is. In a recent article discussing economic development incentives, the Wichita Business Journal looks at the situation in North Texas. (Incentives have meant big business in North Texas, Aug 24, 2015.) An example used in the article is Toyota's decision to move its North American headquarters to Plano. Toyota received incentives in conjunction. The article quotes Jim Lentz, CEO of Toyota North America, as saying "The incentives are really important." But that hasn't always been the line from…

In Sedgwick County, expectation of government entitlements

Aug

By Bob Weeks

In Sedgwick County, expectation of government entitlements

In Sedgwick County, we see that once companies are accustomed to government entitlements, any reduction is met with resistance. When an executive of Spirit Aerosystems accused the Sedgwick County Commission of "working against us," the company may have forgotten the assistance and special treatment the company has received from local governments and taxpayers. This assistance has amounted to hundreds of millions of dollars over several decades, when we consider both Spirit and its predecessor, Boeing. Now, Spirit objects to a proposed reduction in funding to Wichita Area Technical College, and also cuts to local attractions such as the zoo. The…

Aug

By Bob Weeks

Cash incentives in Wichita

Wichita city leaders are proud to announce the end of cash incentives, but they were only a small portion of the total cost of incentives. Wichita city leaders say that cash incentives are on the way out. That's a welcome change. Cash incentives, however, were only a small part of the city's spending on incentives. Far more costly are property and sales tax abatements, tax increment financing, and various programs at the state level. There seems to be no appetite to reduce reliance on these. Forgiveness of taxes is more valuable to business firms than receiving cash. That's because cash…

In Kansas and Wichita, there’s a reason for slow growth

May

By Bob Weeks

In Kansas and Wichita, there’s a reason for slow growth

If we in Kansas and Wichita wonder why our economic growth is slow and our economic development programs don't seem to be producing results, there is data to tell us why: Our tax rates are too high. In 2012 the Tax Foundation released a report that examines the tax costs on business in the states and in selected cities in each state. The news for Kansas is worse than merely bad, as our state couldn't have performed much worse: Kansas ranks 47th among the states for tax costs for mature business firms, and 48th for new firms. (Starting in 2013,…

Feb

By Bob Weeks

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. Industrial Revenue Bonds are a confusing economic development program. We see evidence that citizens are concerned that the city or county is in the business of lending money to companies, when that is not the case. You see this misunderstanding revealed in comments left to newspaper articles reporting the issuance of IRBs, where comment writers complain that the city shouldn't be in the business of lending companies money. IRBs are not a loan by government A recent Wichita…

Dec

By Bob Weeks

Economic development in Sedgwick County

The issue of awarding an economic development incentive reveals much as to why the Wichita-area economy has not grown. At the December 17, 2014 meeting of the Sedgwick County Commission an economic development incentive was considered. The proceedings are of interest as a window into how economic development works. The proposal was that Sedgwick County will make a loan to Figeac Aero in the amount of $250,000 as an economic development incentive in conjunction with its acquisition of a local company and a contemplated expansion. It's likely the county will also participate in forgiving property taxes, although that decision will…

Dec

By Bob Weeks

Research on economic development incentives

As Wichita considers how to grow its economy, its reliance on targeted economic development incentives should be guided by research, not the grandstanding of politicians and bureaucrats. Here's a summary of the peer-reviewed academic research that examines the local impact of targeted tax incentives from an empirical point of view. "Peer-reviewed" means these studies were stripped of identification of authorship and then subjected to critique by other economists, and were able to pass that review. Ambrosius (1989). National study of development incentives, 1969 -- 1985. Finding: No evidence of incentive impact on manufacturing value-added or unemployment, thus suggesting that tax…

WichitaLiberty.TV: Wichita’s legislative agenda, and a bit of bad news

Dec

By Bob Weeks

WichitaLiberty.TV: Wichita’s legislative agenda, and a bit of bad news

In this episode of WichitaLiberty.TV: A look at some elements of Wichita’s legislative agenda for state government, in particular special tax treatment for special artists, problems with the city’s numbers regarding airfares, and why we should abandon the pursuit of passenger rail. Then, why are people not more involved in political affairs? View below, or click here to view at YouTube. Episode 67, broadcast December 7, 2014.

City of Wichita State Legislative Agenda: Economic Development

Nov

By Bob Weeks

City of Wichita State Legislative Agenda: Economic Development

The City of Wichita wishes to preserve the many economic development incentives it has at its disposal. The proposed legislative agenda for the City of Wichita holds this regarding economic development incentives: ISSUE: The State of Kansas provides economic development incentives through a variety of programs. RECOMMEND: The Wichita City Council supports the continuation of state economic incentive programs that assist local governments in their efforts to improve their local economies. That’s all the agenda holds. In the presentation for the previous year, the request was more complete, naming specific programs. It’s useful to revisit that list, as Wichita leaders…

City of Wichita State Legislative Agenda: Cultural Arts Districts

Nov

By Bob Weeks

City of Wichita State Legislative Agenda: Cultural Arts Districts

Wichita government spending on economic development leads to imagined problems that require government intervention and more taxpayer contribution to resolve. The cycle of organic rebirth of cities is then replaced with bureaucratic management. As the City of Wichita prepares its legislative agenda for 2015, an issue arises for the first year. It seems that the success of government spending on development has created rising property values, which creates higher tax bills, and that is a burden for some. Here’s the issue the city has identified: “Cultural arts enterprises in certain areas are threatened by rising property values and the resulting…