Downtown tax vote clears way for streetcar construction

After two decades of false starts and failures, Kansas City finally has voter-approved funding to get on track with fixed-rail transit.

Downtown Kansas City voters gave an “all aboard” OK to streetcars in election results announced Wednesday.

Voters approved, 351 to 198, a 1-cent sales tax increase, and 344 to 206 property tax increases to help pay for a $100 million, two-mile streetcar system. It will run from River Market to Union Station, primarily on Main Street.

The tax increases, authorized for 25 years, will apply only within the defined boundaries of a downtown streetcar district. That covers roughly River Market, the Central Business District, the Crossroads and Crown Center.

Yet already, Jackson County Executive Mike Sanders is floating the possibility of a broader countywide transit tax that might alleviate some of the burden on downtown.

Wednesday’s results occurred in an unusual mail-in election and involved only registered voters living within the streetcar district.

The city hopes to begin construction next year and start running the streetcars in 2015.

“This is going to be a game changer for our city, especially our downtown,” City Councilwoman Jan Marcason said.

“It will be historic,” Mayor Sly James said. “This is only a beginning.”

Supporters emphasized that just running streetcars through two miles of downtown was never the goal. They hope Wednesday’s results springboard a more extensive system of streetcars running to the Plaza and the University of Missouri-Kansas City, and along east-west corridors such as 12th Street or 18th Street.

Councilman Russ Johnson, who has been the council’s point person on transit for four years, said more information on future streetcar extensions should come early next year.

Approval of the taxes was considered a foregone conclusion, ever since downtown voters endorsed creation of the taxing district in a separate mail-in election earlier this summer. The mail-in elections were allowed by state law.

The election process was controversial, because many major property owners who will be paying a big chunk of the new taxes don’t live downtown and didn’t have a vote. They argued the vote should have been put to the entire city, because the streetcars will benefit the entire city and will tax many people who don’t live in the district.

Some opponents have hinted at litigation against the election, but no lawsuit has been filed.

Sue Burke, who owns an air filter business in River Market but couldn’t vote because she doesn’t live downtown, said Wednesday she considered the process to be a “rigged, phony election.”

She said many people who voted for the tax are renters who can move, while landlords and business owners are “stuck paying for something long after the people who voted for it are gone.”

Supporters of the process responded that the main beneficiaries of the new streetcars will be downtown property owners, so they were the ones who should be taxed.

The 1-cent sales tax increase will take effect next spring.

The property taxes include a commercial assessment of 48 cents per $100 of assessed value and residential assessment of 70 cents per $100 of assessed value. Those property taxes begin to come due late next year.

The district taxes will help pay the debt service and operating costs for the streetcar system. The city has also received about $18 million in up-front federal grants and is expected to receive about $4.5 million in water utility contributions toward the construction cost.

The city itself has pledged to contribute $2 million annually for the system. Other funds will come from parking fees and advertising revenues.

Public Works Director Sherri McIntyre said Wednesday that the final design for the system should be done by midsummer, and construction should also start by summer, including utility relocations and even some laying of track. City officials have said they hope to construct the system in two- or three-block increments, to minimize disruption in downtown.

Major property owners still have lots of questions about how this will unfold.

“We remain concerned about the impact on access to all of our garages on Main Street,” said Thomas R. “Buzz” Willard, president of Tower Properties, which owns the Commerce Trust Building and other major downtown properties.

City officials said those concerns should be addressed in the coming months.

Ultimately, there may be a way to spread the tax burden beyond the downtown transit district, at least the sales tax.

The 1-cent district sales tax could go away, if Jackson County voters approve a countywide 1-cent sales tax next summer or fall to pay for the regional transit plan envisioned by Sanders.

“That’s our commitment,” Sanders told The Star.

So far, no decision has been made on whether to go ahead with that $650 million plan for two commuter rail lines, expanded bus service to the suburbs and a network of trails. Agreements with local railroads still have to be worked out.

But were the plan to go on the ballot and pass, Sanders said some of the revenue generated by the countywide tax would be funneled to the city to help pay for the streetcar.

“One of the things we’re looking to do,” Sanders said, “is rolling that into this so that you don’t double tax people for transit.”

In addition to fairness, the promise is aimed at improving the chances for the county transit tax. It could potentially face more opposition than it otherwise might, if downtown residents and businesses felt they were being hit up twice for transit.

James said he has been talking to the county and supports the direction Sanders is moving on his plan.

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