Tax incentive reform ordinance to be heard Wednesday by Kansas City Council

A long-simmering incentive reform ordinance will get its first public hearing before a Kansas City Council committee on Wednesday — but there may not be a vote on it.

“I think it will be a mistake to move that quickly on that large of an ordinance,” said Kansas City Councilman Scott Taylor, who heads the Planning, Zoning and Economic Development Committee that will hear the measure at the afternoon meeting.

An ordinance with seven sponsors first surfaced on the council docket in May, but hasn’t yet come up for a hearing as its proponents have been meeting with interested parties over the past three months.

Quinton Lucas, a councilman representing the 3rd District, has been the measure’s chief proponent. His ordinance, generally speaking, seeks to reduce the level of tax abatement and redirection from Kansas City’s menu of development incentive tools by one-fourth.

For example, a 100 percent, 10-year tax abatement under the Land Clearance for Redevelopment Authority would become a 75 percent abatement under Lucas’ ordinance. The ordinance included a number of exceptions to that limit, including for historic rehabilitation projects, certain environmentally friendly buildings and developments in distressed census tracts.

The measure is meant to address concerns by activists, school officials and others who believe Kansas City redirects too much tax money away from basic services, education and other needs for private developments. It’s also meant to curtail efforts by activists, some of which have been successful, to derail or alter subsidized developments with the threat of referendums or petition initiatives.

Various school district superintendents, library officials and others met Monday with the board of directors for the Economic Development Corporation of Kansas City, the agency that provides support for several agencies that offer incentive programs.

The Economic Development Corporation board called the meeting to talk about the Lucas ordinance, but discussion centered mostly around philosophical differences about the use of incentives.

Taxing jurisdictions generally complained that the generous use of incentives by Kansas City stung the growth of their operating budgets and that they effectively have no authority to negotiate terms of the development projects.

City officials and development proponents countered that vast improvements to places like downtown and the Crossroads Arts District would not have been possible without the involvement of incentives to lessen the financial risk to developers.

This story was originally published August 23, 2016 at 5:13 PM with the headline "Tax incentive reform ordinance to be heard Wednesday by Kansas City Council."