Large businesses in Johnson County are the biggest beneficiaries of the Promoting Employment Across Kansas tax-break program.
But smaller companies also are participating, which just exacerbates the state’s current fiscal problems.
Known as PEAK, the plan allows companies to divert millions of state income dollars every year from the already cash-strapped Kansas budget for up to 10 years. The state rewards the businesses for either staying in Kansas or, often, for just hopping across the state line from Missouri and bringing in new jobs.
Seven of the nine companies in Kansas that collect and retain more than $1 million a year in state taxes from their employees are in Johnson County, led by Teva Pharmaceuticals ($3.9 million annually).
However, dozens of other entities in the county also use the program to keep Kansas income tax revenue and use it for their own purposes.
Most get the award for fewer than 10 years because they aren’t creating or retaining that many jobs in the state.
According to the state’s KanView website, some of the smaller PEAK grants have been awarded to Wachter Inc. ($14,000 a year), AMC Card Processing Services ($13,430), Shield Casework ($13,000), Si Memorials ($6,300), Bukaty Property & Casualty Services ($4,000) and TradeNet Publishing ($3,800).
The PEAK program is overly generous and should be changed so — at the least — it doesn’t give tax breaks to large companies that just move from Missouri to Kansas.
Letting so many private companies keep tax revenues even as the state budget collapses is not a good way to invest in the future of strong public services for Kansas residents.