Development

Sales tax advocates say it’s time for all of KC to support inner-city redevelopment

Five things to know: Citywide eighth-cent sales tax on KC's April 4 ballot

Advocates for a citywide one-eighth-cent sales tax on Kansas City’s April 4 ballot want to spur economic development along Prospect Avenue, a central city stretch that has been deteriorating for decades.
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Advocates for a citywide one-eighth-cent sales tax on Kansas City’s April 4 ballot want to spur economic development along Prospect Avenue, a central city stretch that has been deteriorating for decades.

When the spine is injured, the rest of the body can suffer. When that spine is a decaying commercial route in a city, the damages seep into the city at large.

That spine is Prospect Avenue, say organizers of a initiative petition drive that has put a sales tax question before Kansas City voters on April 4.

If approved by a majority vote, a one-eighth-cent sales tax would be imposed citywide, with the proceeds devoted to economic development along the Prospect corridor.

The “Central City Economic Development Sales Tax,” proposal would raise an estimated $8.6 million a year for 10 years. It will compete for attention along with three general obligation, or GO, bond questions for infrastructure, flood control and public building improvements.

Supporters say that a failure to correct Prospect’s ills has led to the pathologies of poverty, high crime rates, joblessness and feeble property values.

“We don’t think you can have a great city if the urban core is depressed,” said Gayle Holliday, a president of Freedom Inc. and a member of the group supporting the sales tax.

“We’re asking the whole city to support rebuilding our urban core,” Holliday told a citizen group meeting in south Kansas City.

Most Kansas City voters live and work outside the boundaries designed to benefit from the sales tax: Ninth Street to Gregory Boulevard, The Paseo to Indiana Avenue.

Many voters have never even driven the street to see the boarded-up storefronts and houses, the blocks of vacant land, and the fences that enclose most any property of value. Occasional dots of new development do little to counter the overall appearance of decay.

But a group is appealing to voters throughout the city to direct compassionate attention to the area. Along with Freedom Inc. the group includes members of the Urban Summit, the Urban League of Greater Kansas City, the Southern Christian Leadership Conference of Kansas City, Communities Creating Opportunity and MORE2.

“Development is occurring all around the city,” said the Rev. Vernon Howard, a leader of the group. “But there’s not been an equitable focus within the inner city where most people of color and poor whites live.”

Howard said the sales tax campaign focuses on “calling it ‘One City’ and introducing a plan designed to reverse pain and suffering of the inner city that has, for decades, been neglected by a combination of civic, political and corporate investment.”

Mayor Sly James, City Manager Troy Schulte, several City Council members and other civic leaders agree that the Prospect corridor needs millions of dollars in new investment, but they generally disagree that the area has been ignored by City Hall. And many aren’t happy about the petition drive.

“They have the right to petition,” Schulte said of the tax proponents, “but I would quibble that the Prospect area has been ignored.”

Schulte itemized economic stimuli targeting the area:

“We’re building a full-service grocery store with public funds; we’re targeting demolition of Land Bank properties to eliminate blight; we just spent $74 million on a new police crime lab; we have a Super TIF for the Aldi’s store; we’re financing affordable housing in the Ivanhoe neighborhood; and we’re working with the Kansas City Area Transportation Authority to install a bus rapid-transit line on Prospect.”

City leaders also point out millions of dollars in public investment in the 18th and Vine neighborhood and public/private investments along Linwood Boulevard and other streets that are pushing redevelopment eastward.

Sales tax proponents acknowledge those major steps, which are creating “development nodes” around which other commercial projects might grow. But they say small or minority-owned businesses that might be interested in regenerating Prospect typically need some kind of pre-development or bridge financing to even consider their plans.

That’s where the sales tax revenue would come in.

“It can be used for land acquisition, pre-development costs, planning, blight removal,” suggested Gwendolyn Grant, CEO of the Kansas City Urban League. “The revenues could be used in a number of ways to spawn development, especially if it’s tied to other activities in the corridor, such as KCATA’s investment.”

Tax supporters frequently summon the Area Transportation Authority’s proposed ProspectMAX bus line — a souped-up transportation system like the ones already run on Main Street and Troost Avenue — as a vibrant economic incentive tool.

Robbie Makinen, Area Transportation Authority CEO, said the authority “takes no position for or against” any city ballot issue. But that doesn’t mean the authority isn’t interested in development.

“We don’t want to just be tires on the road,” Makinen said of the metro transportation service. “We can be a development partner. We want to help everybody succeed.”

But there’s a glitch regarding the proponents’ repeated references to the PropectMAX as a development catalyst. The $53 million transportation project depends on a federal grant that awaits congressional action in an uncertain political environment. And it must get about $12 million in city funds to go through.

“The match for us is the GO bonds,” Makinen said about general obligation bonds.

Ironically, Freedom Inc. and some of the other sales tax advocates are campaigning against the three general obligation bond issues on the April ballot.

Freedom Inc.’s Holliday said that “nobody talked to us about the MAX bus being included in the bond packages till later. Then we understood that the GO bond might go to that. But we still disagree with the bond questions. Why did the city come after so much at one time? We’re not opposed to some of the content. We might be able to support parts of it.”

But Holliday said the sales tax petitioners saw “so much poverty, hunger and homelessness in the inner city, that the other things aren’t a priority for us.”

Supporters hope the simple majority required to pass the sales tax makes it more likely to pass than the general obligation bond packages, which require a super majority.

Besides, said advocate Clinton Adams, pursuing the sales tax now was “what’s available to us and what we’re willing to use.…We have to stop incenting downtown, the Crossroads, the Plaza and Westport. We need to send dollars where they’re needed now.”

Adams also pointed out that inner city residents have supported many projects, such as Power & Light District development and Jackson County Sports Complex renovations, that perhaps benefited others more than them.

Alissia Canady, a 5th District city councilwoman, said she understands the supporters’ motivations but she disagrees with an initiative petition at this time and with the boundaries they set.

“You’ll have a challenge to get the whole city to support it,” Canady said. “The boundaries are too small, defined projects are wanted, and voters up north and elsewhere will ask, ‘What’s in it for me?’ My constituents would like it to be for a broader area with specific plans.”

Sale tax advocates counter that they want to leave exact investment decisions in the hands of a five-member commission that, by ordinance, would be appointed if the measure passes.

The Kansas City mayor and council would appoint three commissioners; Kansas City Public Schools would appoint one; and Jackson County would appoint one.

City Councilman Quinton Lucas, representing the 3rd District-at-large, said that if he were drawing the boundaries, he too would have wished for a bigger area.

“But I will never tell anybody to keep waiting,” Lucas said. “A lot of these people have been waiting for years.… Waiting for investment to trickle east won’t work. It hasn’t worked for generations. They’re tired of being patient.”

Mayor James is far less accepting.

“They should have talked to me before they went out and got the damn initiative petition, and we could have had a conversation,” James said in a meeting at The Star. “But they didn’t.…I can’t support a tax I have zero idea what it’s going to be used for and controlled by zero people that I don’t know who are going to be.”

James’ term-limited tenure ends in two years.

“Not only that,” James said, “there’s an alternative that was suggested to them. That’s the Shared Success program that would’ve taken money from existing projects and put it in a pool, and that could be used without the tax increase. But they didn’t want that.”

A Shared Success Fund was part of an ordinance passed last year that would divert some developers’ payments in lieu of taxes — that now go to the city — into a fund to provide the kind of bridge or startup financing for inner city redevelopment projects.

Both Shared Success and the sales tax would help projects that are otherwise unaffordable because planners can’t get financing or because they can’t get lease or rental rates sufficient to provide adequate returns on investment.

“There will be people consistently against all tax increases,” Councilman Lucas said. “At some budget meetings I hear that, no matter where people live, they think their taxes go to another part of the city. It’s a challenge for the (sales tax) campaign to explain why a strong core helps the entire city.

“The question is whether they can make that argument on the importance of population retention and job generation to the whole city. They don’t even have to go to the moral or religious appeal of fairness.”

Lynn Horsley of The Star contributed.

Diane Stafford: 816-234-4359, @kcstarstafford

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