The Center School District just hit the jackpot.
By YAEL T. ABOUHALKAH
The Kansas City Star
Freightquote broke ground this week for its new headquarters on long-vacant land in south Kansas City.
In a few years, land that has yielded only $7,000 a year in property taxes for the school district will be creating upward of $600,000 annually in property taxes to educate 2,300 children. Just over 75 percent are minorities; 71 percent are eligible for the free/reduced-price lunch program.
Wait, whats that? The kids arent going to get much of that money from Freightquote?
Oh, thats right. Its all coming back to me now.
Freightquote, an online freight-shipping broker, is going to get a staggering amount of taxpayer incentives to leave Lenexa and hop the state line.
Missouri is kicking in $33 million in taxpayer incentives and, incredibly, Kansas City decided to sweeten the pot even more with an outlandish $31 million in extra tax breaks.
That includes a 100 percent abatement on local property taxes for 20-plus years. So the city, Jackson County, Mid-Continent Public Library, Jackson County Community Mental Health Fund and other taxing jurisdictions will get next to nothing in property taxes from Freightquote, which essentially will get to keep that money.
Center Superintendent Bob Bartman told me Wednesday that his district does expect to get a payment in lieu of taxes approaching $25,000 annually because of the Freightquote deal. But thats still far short of the $600,000 a year and more over time that the district could have received.
In an email, Mid-Continent library Director Steve Potter said, Freightquote is HORRIBLE public policy.
But it turns out school and library officials had no real voice in this matter.
Thats because local school districts, counties, libraries and other taxing jurisdictions dont control how millions of dollars in public incentives are granted.
Instead, state laws allow the decisions to be made by TIF commissions stacked with city-appointed members and by city councils.
After years of wrangling and being ignored by city officials, the taxing jurisdictions are fit to be tied.
As Kansas City Public Library Director R. Crosby Kemper III recently wrote to Mayor Sly James and the City Council:
Is there any chance a few of you might just think something needs to be changed rather than continuing to shove this down our throats?
Kemper was upset that the city decided to use hundreds of thousands of dollars from the Kansas City Public Schools, the library and other jurisdictions to give away in incentives to Lockton Cos. on the Plaza.
Theres no shortage of other flashpoints in this longstanding battle.
• One plan under review would spend $3.1 million for extended streetscape improvements on Main Street, produced by tax revenues from the Federal Reserve Bank headquarters south of Penn Valley Park.
Kansas City Public Schools would lose $1.9 million, and the library and Jackson County close to $200,000 each, in future revenues in the deal.
The school district and library TIF officials oppose this plan because it would force them to do the job of the city or private companies in paying for infrastructure repairs and landscaping along Main Street.
• The Raytown School District wants to control up to $4 million in potential school funds from a southeast Kansas City TIF plan. But the city instead might use the money to build youth soccer fields.
• In North Kansas City, city officials are supporting a plan to divert $6 million in North Kansas City School District funds to development of a mostly residential community. School officials voted against the plan at the TIF meeting.
But that panel is controlled by city-appointed members who wanted to use educational funds to back a private development.
So how will things change?
Cities sure wont give up their control of the money.
Lets hope the excessive local subsidies for Freightquote become Exhibit No. 1 in the taxing jurisdictions attempts to overhaul state regulations in 2013.