Voice For Liberty

Tag: Wichita city government

  • Wichita property tax on commercial property: High

    Wichita property tax on commercial property: High

    An ongoing study reports that property taxes on commercial and industrial property in Wichita are high. In particular, taxes on commercial property in Wichita are among the highest in the nation.

    Click for larger.

    The study is produced by Lincoln Institute of Land Policy and Minnesota Center for Fiscal Excellence. It’s titled “50 State Property Tax Comparison Study” and may be read here. It uses a variety of residential, apartment, commercial, and industrial property scenarios to analyze the nature of property taxation across the country. I’ve gathered data from selected tables for Wichita.

    In Kansas, residential property is assessed at 11.5 percent of its appraised value. Commercial property is assessed at 25 percent of appraised value, and public utility property at 33 percent. (Appraised value is the market value as determined by the assessor. Assessed value is multiplied by the mill levy rates of taxing jurisdictions to compute tax.)

    This means that commercial property faces 2.104 times the property tax rate as residential property, according to this study. (1)The ratio of 25 to 11.5 is 2.174, so some small factors have a role. The U.S. average is 1.713. Whether higher assessment ratios on commercial property as compared to residential property is desirable public policy is a subject for debate. But because Wichita’s ratio is high, it leads to high property taxes on commercial property.

    For residential property taxes, Wichita ranks below the national average. For a property valued at $150,000, the effective property tax rate in Wichita is 1.19 percent, while the national average is 1.34 percent. The results for a $300,000 property were similar.

    Of note is the property taxes on a median-valued home. In this case, Wichita is a bargain, due to our lower housing prices. A home at the median value in Wichita pays $1,655 in taxes, while the nationwide average is $4,562. (The median home value in Wichita is $139,800 and for the nation, $326,392, according to this report.)

    Looking at commercial property, Wichita taxes are high. For example, for a $100,000 valued property, the study found that the national average for property tax is $2,206 or 1.84 percent of the property value. For Wichita the corresponding values are $3,229 or 2.69 percent, ranking seventh-highest among the 50 largest cities. Wichita property taxes are 46 percent higher than the national average, for this scenario.

    For industrial property taxes, the situation in Wichita is better, with Wichita ranking near the middle of the 50 largest cities. For an industrial property worth $1,000,000, taxes in Wichita are $29,372. The national average is $30,498.

    References

    References
    ↑1The ratio of 25 to 11.5 is 2.174, so some small factors have a role.

  • Wichita aerospace manufacturing concentration

    Wichita aerospace manufacturing concentration

    Wichita leaders want to diversify the area economy. Has there been progress?

    In the wake of layoffs at Textron Aviation and Spirit Aerosystems, Wichita’s leaders shifted their attention to the need to diversify the Wichita metropolitan area economy. This has been a recognized need for a long time. 1

    Recently the Wichita Eagle published an article addressing this matter. 2 It did not, however, cite any statistics that measure the diversity — or lack of — in the Wichita economy.

    One way to measure the concentration of an industry in a location is by the proportion of employment in that industry. The Bureau of Labor Statistics provides the number of employees by industry for metropolitan areas. I’ve gathered the data for the Wichita MSA for two industries: Aerospace Product and Parts Manufacturing (NAICS code 3364) and all manufacturing. I compare it to total private sector employment. This data is not adjusted for seasonality, as some are available only in that manner. Data is through June 2020.

    First, note the effects on employment due to the response to the pandemic.

    Here are the employment ratios.


    As the charts illustrate, there was a large downward shift in the two industry’s share of employment around the time of the Great Recession. Since then, the ratios have been more stable, with a slow decline until a small reversal of that trend over the last two years until the effects of the pandemic. That caused the ratios of employment in manufacturing to fall.

    The charts of employment ratio changes from the same month one year ago confirms: Manufacturing and aerospace employment has grown faster than total private employment for the last two years or so, until the pandemic.


    Another way to measure the concentration of industry is through location quotients. The Bureau of Labor Statistics provides these, most notably for counties as part of the Quarterly of Census and Wages. 3 As described by BLS, “Location quotients are useful for studying the composition of jobs in an area relative to the average, or for finding areas that have high concentrations of jobs in certain occupations. As measured here, a location quotient shows the occupation’s share of an area’s employment relative to the national average.” 4

    Further: “For example, a location quotient of 2.0 indicates that an occupation accounts for twice the share of employment in the area than it does nationally, and a location quotient of 0.5 indicates the area’s share of employment in the occupation is half the national share.”

    This data is available by industry. I’ve gathered data for Aerospace Product and Parts Manufacturing (NAICS code 3364) for Sedgwick County and present it in a nearby chart. Data is through the end of 2019, and so does not reflect the pandemic.

    First, note that the location quotient is large, averaging around 32 in recent years. This means the concentration of workers in this industry in Sedgwick County is 32 times the concentration nationwide.

    Second, the location quotient fell from 2007 through 2014. Since then, it has been steady.

    Has the Wichita area diversified its economy? Based on these two measures, the answer is yes. That increase in diversity coincided with a large decline in aviation-related employment, with that decline being larger than the decline in all Wichita-area private-sector employment. That was not planned or desired. It was a result of worldwide trends, most notably the Great Recession.

    But since 2014, concentration in aviation-related employment has changed little, meaning no progress in diversification.

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    Notes

    1. See, for example: Roe, John. Where To From Here? Surviving The Coming Bad Times Will Require A Direction, Wichita Eagle, February 7, 1993. ↩
    2. Stringer, Megan. Aviation is key to Wichita. For workers, what does a diversified economy mean? Wichita Eagle, July 26, 2020. Available at https://web.archive.org/web/20200728163347/https://www.kansas.com/news/business/aviation/article244420152.html. ↩
    3. Bureau of Labor Statistics. Quarterly Census of Employment and Wages. Available at https://www.bls.gov/cew/datatoc.htm. ↩
    4. Bureau of Labor Statistics. Using Location Quotients to Analyze Occupational Data. Available at https://www.bls.gov/oes/highlight_location_quotients.htm. ↩
  • Century II maintenance to be considered

    Century II maintenance to be considered

    The Wichita city council will consider spending $250,000 on maintenance for Century II. There are questions regarding the source of funding.

    This week the Wichita City Council will consider spending $250,000 on maintenance items for Century II and the attached expo hall. The items are mostly ventilation, air conditioning, and plumbing. 1 There is some uncertainty as to how the city plans to fund these projects.

    In a Facebook conversation, an unknown city official was quoted: “We are using Transient Guest Tax funds for these repairs. The bonding resolution provides us with the flexibility to cash fund or debt fund the improvements. But in either case it will be paid from the TGT.” 2

    This seems at odds with material from the agenda packet for the meeting, which states: “Financial Considerations: The 2019-2028 Adopted CIP includes $250,000 in General Obligation bond funding for Century II Repairs in 2020. Staff recommends initiating $250,000 at this time”

    The city’s 2019-2028 Adopted Capital Improvement Program shows these amounts as either actual or adopted for the category “Cash Transfer to CIP Projects” from the Tourism and Convention Fund”

    2017 $1,624,585
    2018 $891,960
    2019 $1,857,891
    2020 $550,000
    2021 $2,050,000

    The same document notes for this fund: “Revenues are received primarily from the Transient Guest Tax, currently set at 6% of gross receipts.” From other city documents, the fund receives no dollars other than the transient guest tax in some years, 2019 and 2020 specifically. In 2021, the city budget projects the fund will receive $350,000 in other revenue and $7,635,348 from the transient guest tax.

    As is common with these expenditures, even as small as this, the city plans to borrow the funds: A related ordinance states: “Section 2. Project Financing. All or a portion of the costs of the Project, interest on financing and administrative and financing costs shall be financed with the proceeds of general obligation bonds of the City.”

    As you can see, there is some confusion. One source says the funding is the transient guest fund, while other sources state funding is general obligation bonds, which could, of course, be paid with transient guest funds revenue. Hopefully, city staff will clarify this at the July 14, 2020 meeting.

    I’ve gathered relevant pages from city documents and present them here.

    Painting courtesy Goffrier Studio.

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    Notes

    1. The bonding resolution, number 20-192, states: “Facility repairs and improvements to Century II (District I). Including, but not be limited to, prioritized critical building system improvements, renovation and repairs as well as replacement of Expo Hall HVAC Roof-Top Unit systems and Century II circulation pumps throughout the facility and mechanical, electrical and plumbing and fire/life safety and structural concerns where hazardous conditions may develop.” ↩
    2. Facebook. Available at https://www.facebook.com/groups/CenturyII/permalink/1439270942947133/. ↩
  • Effects of pandemic on Wichita metro employment

    Effects of pandemic on Wichita metro employment

    Here is the effect of the pandemic — or rather, the effect of the response to the pandemic — on Wichita metropolitan area employment. For more data on this topic, see Wichita jobs and employment, May 2020.

  • Stephen Ware: Debate on masks, freedom

    Stephen Ware: Debate on masks, freedom

    Can libertarians accept a mask mandate?

    This op-ed by Kansas University Law Professor and noted libertarian Stephen Ware shows how libertarians can tolerate, if not embrace, a government mandate to wear masks to help slow the spread of COVID-19. It is free to read in the Topeka Capital-Journal here.

    Here is an excerpt that I believe presents the heart of the reasoning:

    In that sense, a mask requirement is less like a seatbelt law designed to protect the wearer and more like a law against driving under the influence of alcohol. Many deaths have been caused by drunken drivers who did not intend to harm anyone, and many of those drivers likely did not even realize they were dangerous.

    Similarly, science may be discovering that many of us endanger those around us even when we do not realize we are dangerous because we are not yet experiencing COVID-19 symptoms, although we have been infected and are contagious.

    COVID-19 raises the possibility that each of us is, without knowing it, like the dangerously intoxicated person getting into the drivers’ seat.

    Protecting others, not yourself, is the main reason for masking. Although, protecting others has the benefit of helping tamp down the pandemic, making it less likely that you will contract the disease in the future.

    We don’t praise intoxicated drivers for “bravely” creating and accepting risk to their safety while creating a substantial risk to innocent others. In the same way, those who “bravely” venture out in public unmasked should be criticized for the unnecessary risk they present to others.

    Photo by Vera Davidova on Unsplash

  • Metropolitan employment and labor force

    Metropolitan employment and labor force

    A visualization of employment, labor force, and the unemployment rate for metropolitan areas, now with data through May 2020.

    How does the Wichita metropolitan area compare with others regarding employment, labor force, and unemployment rate? The Bureau of Labor Statistics, part of the United States Department of Labor, has data that provides the answer.

    I’ve gathered data from BLS and present it in an interactive visualization with tables, charts, and a map. This monthly data is from 1990 to May 2020, which is the last month for which BLS has produced data for metropolitan areas. Click here to learn more and use the visualization. Below is an example from the visualization.

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  • Wichita jobs and employment, May 2020

    Wichita jobs and employment, May 2020

    For the Wichita metropolitan area in May 2020, the number of unemployed persons is up, the unemployment rate is up, and the number of people working is down, all by large amounts, when compared to the same month one year ago, but improving from April.

    Data released yesterday by the Bureau of Labor Statistics, part of the United States Department of Labor, shows the effects of the response to the pandemic in the Wichita Metropolitan Statistical Area for May 2020.

    Click charts and tables for larger versions.

    Total nonfarm employment fell from 307,500 last May to 285,000 in May 2020, a loss of 22,500 jobs (7.3 percent). (This data is not seasonally adjusted, so month-to-month comparisons are not valid.) For the same period, employment in the nation fell by 11.7 percent. The unemployment rate in May 2020 was 13.9 percent, up from 3.2 percent one year ago.

    Considering seasonally adjusted data from the household survey, the labor force rose by 4,407 persons (1.3 percent) in May 2020 from April 2020, the number of unemployed persons fell by 14,143 (23.2 percent), and the unemployment rate was 14.2 percent, down from 18.2 percent in April. The number of employed persons not working on farms rose to 283,562 in May from 273,826 the prior month, an increase of 9,736 persons (3.6 percent).

    The following chart of the monthly change in the labor force and employment shows the magnitude of the drop in April overwhelming other months, and then a positive change in May.

    The following chart of changes from the same month one year ago shows a similar same trend — fewer jobs, although the labor force grew.

    The following chart of changes in employment from the same month of the previous year shows months when the Wichita MSA performed better than the nation. For April and May 2020, the two full months first affected by the pandemic, we see the decline in employment Wichita has not been as severe as the nation..

    The following two charts show changes in jobs for Wichita and the nation over longer periods. The change is calculated from the same month of the previous year. For times when the Wichita line was above the nation, Wichita was growing faster than the nation. This was often the case during the decades starting in 1990 and 2000. Since 2010, however, Wichita has rarely outperformed the nation and sometimes has been far below the nation.

  • Wichita city population rises in 2019

    Wichita city population rises in 2019

    Wichita city population rose in 2019, but is still below its recent peak.

    Each year the United States Census Bureau produces new population estimates through its Population and Housing Unit Estimates program.

    For the City of Wichita on July 1, 2019, the estimated population was 389,938. This is an increase of 707 over the prior year, which is 0.18 percent. It is below Wichita’s peak population of 390,519 in 2016 by 581 people (0.15 percent).

    When the Census Bureau produces estimates for a new year, it also revises the estimates for prior years. For the city of Wichita in recent years, the revisions have been very small, almost always less than one-tenth of one percent.

    A nearby chart plots the population of the city, along with Overland Park, which is the second-largest city in Kansas. The chart also plots the percent change from the prior year. It is common for large changes to appear in decennial census years like 2010, as estimates are recalibrated to the census.

    For the population of the Wichita metropolitan area, see Wichita metro population for 2019.

    I’ve created an interactive visualization of this and other population data. Click here to learn more and access the visualization.

    Click for larger.
  • Effects of pandemic on Wichita metro employment

    Effects of pandemic on Wichita metro employment

    Here is the effect of the pandemic — or rather, the effect of the response to the pandemic — on Wichita metropolitan area employment. For more data on this topic, see Wichita jobs and employment, April 2020.