Wichita sales tax issue 2014

Essential reading

Art Hall: Embracing Dynamism: The Next Phase in Kansas Economic Development Policy

Alan Peters and Peter Fisher: The Failures of Economic Development Incentives, Journal of the American Planning Association

The Colorado Springs Model: A Voluntary, Entrepreneurial City

Contrary to officials, Wichita has many incentive programs. Wichita government leaders complain that Wichita can’t compete in economic development with other cities and states because the budget for incentives is too small. But when making this argument, these officials don’t include all incentives that are available.

News articles

Real People, Real Life. A local Wichita televised talk show. The August 19, 2014 episode featured Jennifer Baysinger speaking on the sales tax. This link is to the show on YouTube, starting with Jennifer’s appearance. She also appeared in part two of the show, which you may view here.

Wichita Chamber board votes to support sales tax initiative. August 18, 2014. Wichita Business Journal.

1-cent sales tax could help fund innovation facilities. August 16, 2015. kansas.com.

A conversation with Gary Schmitt. August 10, 2014. kansas.com

Eagle editorial: Join the sales-tax debate. August 7, 2014. kansas.com

City Council votes to place proposed sales tax on November ballot. August 6, 2014. kansas.com

Jon Rolph: Let citizens vote on Wichita’s priorities. August 3, 2014. kansas.com

Proposed 1-cent sales tax would add, expand Wichita bus routes. August 3, 2014. kansas.com

Jennifer Baysinger: Sales tax hike not justified. August 1, 2014. kansas.com

Where are Wichita’s Jobs? July 25, 2014. Wichita Business Journal

Panelists at Pachyderm Club speak out against city sales tax. July 22, 2014. kansas.com

Wichita’s water challenges, proposed sales tax discussed at forum. July 17, 2014. kansas.com

Eagle editorial: Wichita taxes comparatively low. June 1, 2014. kansas.com

Dane Stangler and Jason Wiens: Young companies are the job creators. June 1, 2014. kansas.com

City, business leaders weigh transparency of jobs fund. May 31, 2014. kansas.com

Eagle editorial: City Council made big move. May 29, 2014. kansas.com

Wichita City Council approves four projects to get revenue from proposed 1-cent sales tax. May 27, 2014. kansas.com

Eagle editorial: Don’t rush tax decision. May 27, 2015. kansas.com

Wichita City Council to narrow community projects list to needs only. May 26, 2014. kansas.com

Richard Florida Concedes the Limits of the Creative Class. DailyBeast.com

Wichita mayor predicts support for projects, tax increase at polls. May 25, 2014. kansas.com, Newsbank

City Council debates projects to include in possible sales tax increase. May 20, 2014. kansas.com, Newsbank

Gary Schmitt: Is Wichita satisfied? May 18, 2014. kansas.com

Eagle editorial: Key decisions loom on sales-tax increase. May 18, 2014. kansas.com

Business Pulse Survey: Most say no to additional Wichita eco-devo money. May 9, 2014. Wichita Business Journal

Editorial: $90 million war chest — watch for details. May 9, 2014. Wichita Business Journal

How the proposed $90M job fund could work. May 6, 2014. Wichita Business Journal

$3 billion price tag for Wichita projects stuns council. May 6, 2014. kansas.com, Newsbank

Wichita jobs fund discussion set for Tuesday morning workshop. May 5, 2014. Wichita Business Journal

Wichita City Council to discuss jobs fund, transit, quality-of-life facilities. May 5, 2015. kansas.com, Newsbank

Analysts: Buy-in needed to pass sales tax increase in Wichita. May 4, 2014. kansas.com, Newsbank

Eagle editorial: Need action on jobs. May 4, 2014. kansas.com, Newsbank

Wichita leaders will assess support for sales tax increase for economic development. May 1, 2014. Wichita Business Journal

High Touch’s Chambers: Plan would give Wichita $90 million in needed eco-devo ammo. May 1, 2014. Wichita Business Journal

Wichita leaders seeking a $90 million economic development pool. May 1, 2014. Wichita Business Journal

$90 million sought to grow Wichita jobs, possibly from sales tax. May 1, 2014. kansas.com, Newsbank

‘No more spending’ won’t solve Wichita’s problems, council says. March 21, 2014. kansas.com, Newsbank

Mayor Carl Brewer: Wichita heard you. March 2, 2014. kansas.com, Newsbank

Sales tax could be on ballot as early as fall to fund Wichita projects. March 1, 2014. kansas.com, Newsbank

City Council discusses sales tax referendum at strategic planning session. February 25, 2014. kansas.com, Newsbank

Eagle editorial: Thanks for asking, City Hall. February 25, 2014. kansas.com, Newsbank

Wichitans’ top priorities for tax dollars: stable water source, more jobs. February 22, 2014. kansas.com, Newsbank

Wichitans respond to city leaders’ call for community input. January 4, 2014. kansas.com, Newsbank

Wichita conservatives voice take on city’s future at Pachyderm Club. December 21, 2013. kansas.com, Newsbank

Mayor: Chinese investors interested in Wichita. December 18, 2013. link

Eagle editorial: Do what citizens want. December 1, 2013. kansas.com, Newsbank

Council members say they’ll wait for public input before considering sales tax. November 21, 2013. kansas.com, Newsbank

Council weighs possible sales tax initiative for city’s projects. November 23, 2013. kansas.com, Newsbank

Voice for Liberty articles

What the Wichita city council could do. While the proposed Wichita city sales tax is a bad idea, the city could do a few things that would not only improve its chance of passage, but also improve local government.

Wichita sales tax hike would hit low income families hardest. Analysis of household expenditure data shows that a proposed sales tax in Wichita affects low income families in greatest proportion, confirming the regressive nature of sales taxes.

For Wichita leaders, novel alternatives on water not welcome. A forum on water issues featured a presentation by Wichita city officials and was attended by other city officials, but the city missed a learning opportunity.

For Wichita’s new water supply, debt is suddenly bad.

The state of Wichita, 2014. Wichita Mayor Carl Brewer delivered the annual State of the City address. He said a few things that deserve discussion.

Wichita downtown boom could be over before it starts.

Contrary to officials, Wichita has many incentive programs. Wichita government leaders complain that Wichita can’t compete in economic development with other cities and states because the budget for incentives is too small. But when making this argument, these officials don’t include all incentives that are available.

Wichita debt levels projected to rise.

Transparency groups want to know where Wichita tax money is going to promote Wichita.

For Wichita’s economic development machinery, failure. Compared to a broad group of peer metropolitan areas, Wichita performs very poorly. As Wichita embarks upon a new era of economic development, we need to ask who to trust with this important task.

In Wichita, the streetside seating is illuminated very well. Wichita city leaders tell us that the budget and spending have been cut to the bone. Except for the waste, that is.

WichitaLiberty.TV: Examining surveys about the future of Wichita. In this episode of WichitaLiberty.TV: What do Wichitans want for their city’s future? Surveys from the City of Wichita and Kansas Policy Institute are examined.

In Kansas, tax giveaways for job creation found ineffective.

Wichita economic development incentives: Do they help? The Wichita City Council regularly awards economic development incentives. Are these incentives helpful, or not?

Campaign contributions show need for reform in Wichita. Wichita City Council members Lavonta Williams and James Clendenin have filed campaign finance reports that reinforce the need for campaign finance reform in Wichita and Kansas.

Wichita develops plans to make up for past planning mistakes. On several issues, including street maintenance, water supply, and economic development, Wichita government and civic leaders have let our city fall behind. Now they ask for your support for future plans to correct these mistakes in past plans.

Wichita not good for small business. When it comes to having good conditions to support small businesses, well, Wichita isn’t exactly at the top of the list, according to a new ranking from The Business Journals.

During Sunshine Week, here are a few things Wichita could do. The City of Wichita says it values open and transparent government, but the city could improve several areas of providing information and records to citizens.

Wichita seeks to add more tax to hotel bills. The city of Wichita wants hotel guests to make a “marketing investment” in Wichita by paying a “City Tourism Fee.”

Regulation failure leads to tragedy in Wichita.

Where’s Wichita’s water?

Wichita planning documents hold sobering numbers.

Economic development in Wichita, steps one and two.

Wichita Chamber of Commerce: Why these panelists? Last week the Wichita Metro Chamber of Commerce conducted a panel discussion about economic development and job creation in Wichita. The experts selected as panelists tells us a lot about why the Wichita economy has suffered.

Kansas Policy Institute survey

Scientific Poll: Wichitans Don’t Want Sales Tax Increase. KPI press release with quotes and links to survey results.

Poll: Wichitans don’t want sales tax increase.

In Wichita, opinion of city spending consistent across party and ideology.

Few Wichitans support taxation for economic development subsidies. In Wichita, about one-third of voters polled support local governments using taxpayer money to provide subsidies to certain businesses for economic development.

Wichitans willing to fund basics. In Wichita, voters are willing to pay a higher sales tax for fundamentals like infrastructure and water supply, and less willing for business incentives, downtown development, and convention centers.

To fund government, Wichitans prefer alternatives to raising taxes. Wichita voters prefer adjusting spending, becoming more efficient, using public-private partnerships, and privatization to raising taxes.

Documents

A depository of documents is here. Or, view individual documents below.

CEDBR fiscal model presentation to Wichita City Council. link

Potential Allocation of 1/10 of a Cent Sales Tax Funds to Support Transit Activities. link

Strategic Plan Issues Powerpoint presentation. link

Passenger rail white paper. link

Pavement maintenance white paper. link

Water supply planning white paper. link

Strategic plan issues presentation May 13, 2014. link

Competing for jobs report: Will Wichita Accelerate Competition for Primary Jobs? Time for a community discussion. link

Economic development white paper. link

Homelessness white paper. link

Public transportation white paper. link

Quality of life facilities white paper. link

Strategic plan issues presentation. May 6, 2014. link

Wichita 2035 Growth & Community Investment Scenarios Summary Sheet. link

Wichita City Council and Plan Steering Committee Workshop Plan Development Progress Report. Februray 25, 2014. link

Proposed Community Engagement/Outreach Approach — April thru June 2014. Long-Term Wichita 2035 Growth & Community Investment Scenarios. link

Research on incentives

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 incentives were ineffective.

Trogan (1999). National study of state economic growth and development programs, 1979 — 1995.
Finding: General fiscal policy found to be mildly effective, while targeted incentives reduced economic performance (as measured by per capita income).

Gabe and Kraybill (2002). 366 Ohio firms, 1993 — 1995.
Finding: Small reduction in employment by businesses which received Ohio’s tax incentives.

Fox and Murray (2004). Panel study of impacts of entry by 109 large firms in the 1980s.
Finding: No evidence of large firm impacts on local economy.

Edmiston (2004). Panel study of large firm entrance in Georgia, 1984 — 1998
Finding: Employment impact of large firms is less than gross job creation (by about 70%), and thus tax incentives are unlikely to be efficacious.

Hicks (2004). Panel study of gaming casinos in 15 counties (matched to 15 non-gambling counties).
Finding: No employment or income impacts associated with the opening of a large gambling facility. There is significant employment adjustment across industries.

LaFaive and Hicks (2005). Panel study of Michigan’s MEGA tax incentives, 1995 — 2004.
Finding: Tax incentives had no impact on targeted industries (wholesale and manufacturing), but did lead to a transient increase in construction employment at the cost of roughly $125,000 per job.

Hicks (2007a). Panel study of California’s EDA grants to Wal-Mart in the 1990s.
Finding: The receipt of a grant did increase the likelihood that Wal-Mart would locate within a county (about $1.2 million generated a 1% increase in the probability a county would receive a new Wal-Mart), but this had no effect on retail employment overall.

Hicks (2007b). Panel study of entry by large retailer (Cabela’s).
Finding: No permanent employment increase across a quasi-experimental panel of all Cabela’s stores from 1998 to 2003.

(Based on Figure 8.1: Empirical Studies of Large Firm Impacts and Tax Incentive Efficacy, in Unleashing Capitalism: Why Prosperity Stops at the West Virginia Border and How to Fix It, Russell S. Sobel, editor. Available here.)

In discussing this research, the authors of Unleashing Capitalism explained:

Two important empirical questions are at the heart of the debate over targeted tax incentives. The first is whether or not tax incentives actually influence firms’ location choices. The second, and perhaps more important question, is whether, in combination with firms’ location decisions, tax incentives actually lead to improved local economic performance.

We begin by noting that businesses do, in fact, seem to be responsive to state and local economic development incentives. … All of the aforementioned studies, which find business location decisions to be favorably influenced by targeted tax incentives, also conclude that the benefits to the communities that offered them were less than their costs.

References:

Ambrosius, Margery Marzahn. 1989. The Effectiveness of State Economic Development Policies: A Time-Series Analysis. Western Political Quarterly 42:283-300.
Trogen, Paul. Which Economic Development Policies Work: Determinants of State Per Capita Income. 1999. International Journal of Economic Development 1.3: 256-279.
Gabe, Todd M., and David S. Kraybill. 2002. The Effect of State Economic Development Incentives on Employment Growth of Establishments. Journal of Regional Science 42(4): 703-730.
Fox, William F., and Matthew Murray. 2004. Do Economic Effects Justify the Use of Fiscal Incentives? Southern Economic Journal 71(1): 78-92.
Edmiston, Kelly D. 2004. The Net Effects of Large Plant Locations and Expansions on County Employment. Journal of Regional Science 44(2): 289-319.
Hicks, Michael J. 2004. A Quasi-Experimental Estimate of the Impact of Casino Gambling on the Regional Economy. Proceedings of the 93rd Annual Meeting of the National Tax Association.
LeFaivre, Michael and Michael Hicks 2005. MEGA: A Retrospective Assessment. Michigan:Mackinac Center for Public Policy.
Hicks, Michael J. 2007a. The Local Economic Impact of Wal-Mart. New York: Cambria Press.
Hicks, Michael J. 2007b. A Quasi-Experimental Test of Large Retail Stores’ Impacts on Regional Labor Markets: The Case of Cabela’s Retail Outlets. Journal of Regional Analysis and Policy, 37 (2):116-122.

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