Port KC has agreed to lay down its arms in an effort to cooperate with the economic development ceasefire between Kansas and Missouri.
On Monday, the development committee of the Port Authority of Kansas City’s board unanimously approved a measure intended to mirror its incentives with those available in Kansas.
It’s an important move because Port KC potentially could have stood in the way of a recent agreement between Kansas Gov. Laura Kelly and Missouri Gov. Mike Parson. For years, Kansas City-area economic developers on both sides of the state line have offered tax breaks to companies hopping State Line Road — a heavily criticized process because the moves rarely created new jobs for the region.
Kelly’s Aug. 2 executive order ending subsidies for companies in Missouri border counties specifically called out the port authority. In it, she warned she may rescind her order if Missouri-side governments, including the port authority, offered incentives that exceeded what’s available in Kansas.
The border war truce, which goes into effect Aug. 28, will end state incentives for companies that hop the state line without creating new jobs. But it doesn’t necessarily address what Kansas officials perceive as a persisting imbalance: In Kansas, economic developers can offer local property tax abatement for a period of up to 10 years. In Missouri, that limit is 25 years.
Newly inaugurated Kansas City Mayor Quinton Lucas recently announced he would introduce a city council ordinance that would limit local property tax abatements to 10 years to correspond with the cap in Kansas. John Stamm, the mayor’s chief of staff, said the administration was drafting that ordinance this week.
Port KC is the city’s only incentive-awarding agency outside the umbrella of economic development organizations controlled by the Economic Development Corporation of Kansas City. That creates the potential for developers to approach the port in an effort to get around the border war truce.
But board members on Monday said they had no intention of going against the spirit of the bi-state agreement.
“This is probably appropriate as we are a state agency,” board member Linda Clark said. “So we need to get in line with the governor.”
Under Missouri law, Port KC is a political subdivision of the state, though board members are appointed by the Kansas City mayor.
Jon Stephens, president and CEO of Port KC, said the agency could “proactively recruit” businesses from the Kansas side of the border.
“But I know that is not the intent of this organization, nor should it be the intent of this organization,” he said at the meeting. “This organization is committed to growing the economy of Kansas City, Missouri, growing jobs and opportunity in Kansas City, Missouri, but not at the expense of the greater Kansas City metro area.”
The resolution passed by the port authority committee on Monday is expected to be approved by the full board later this month. It states that the organization “unequivocally supports” ending the border war for the greater good of the region. But the resolution included a caveat: In it, Port KC “recognizes that it cannot prohibit its tenants from marketing or leasing space to employers based in other states, counties and cities.”
Stephens said he will attend a summit held by Parson and Kelly on Tuesday morning. The governors plan to celebrate the economic development truce, even as both Kansas and Missouri continue efforts to recruit businesses across the state line before the Aug. 28 deadline.
The Hall Family Foundation estimates the border war has cost Missouri and Kansas taxpayers a combined $335 million to shuffle some 12,000 jobs across the state line between 2011 and 2018.