The high price of the border war: Kansas is wasting tax dollars to entice HCA
Seasons change, politicians come and go, but the tiresome, counterproductive economic border war between Kansas and Missouri never ends.
The states must stop doing this.
The latest chapter in the too-oft-told tale unfolded last week when HCA Midwest Health announced plans to move from Kansas City to Overland Park. The firm’s 70 workers will shift to their new home this summer, abandoning their current offices at I-435 and Holmes.
“We are relocating our employees, roughly four miles away, to better meet our long-term, dynamic office needs,” said HCA Midwest Health president M.L. Lagarde.
The company’s needs apparently included a dynamic subsidy from Kansas. According to documents released to The Star by Gov. Jeff Colyer’s office, Kansas provided roughly $3 million in tax breaks and incentives to entice the company to make the move.
It’s hard to overstate the silliness of this latest episode of corporate welfare. The structure of the agreement suggests it will be years before the state recoups its investment.
At a time when Kansas is scraping for dollars to educate its children, coughing up $3 million is a waste.
The story gets worse. Poaching 70 jobs will likely prompt retaliation from Missouri, which has its own picnic basket of goodies to dangle before executives with itchy feet.
Or maybe the damage has already been done. Last fall, Missouri boasted of luring 400 Swiss Re jobs across the state line, at a cost of roughly $20 million over five years. Gov. Eric Greitens — who led the fight to stop tax credits for low-income housing — cheerfully endorsed the giveaway.
Greitens’ proposed budget reduces spending for higher education and fails to fully fund public schools. Swiss Re, on the other hand, is doing just fine.
Sadly, Kansas and Missouri officials suggest they’re powerless to stop this worthless competition, as if some unseen hand is forcing them to write checks.
They’re wrong. Both Colyer and Greitens should agree to a permanent economic incentive cease-fire for companies that just want to relocate in the Kansas City area.
Incentives for new firms with new jobs should be considered. Incentives for expansion or job retention can also be on the table.
But paying HCA Midwest $426 per yard to move makes no sense for any reasonable taxpayer.
Colyer deserves credit for releasing this information to The Star. The Kansas Department of Commerce refused to make the subsidy public, which is no surprise, of course.
At the same time, Colyer is a plastic surgeon who works at one of the hospitals in the HCA group. That suggests a potential conflict of interest.
The governor has denied any involvement in the decision, claiming it was worked out before he took office.
Someone should take a look at Colyer’s explanation. The Legislature could do the job — or a state auditor, if Kansas had one.
Then the two governors could meet and call it off. Kansas and Missouri would be better for it.
This story was originally published February 14, 2018 at 7:25 AM with the headline "The high price of the border war: Kansas is wasting tax dollars to entice HCA."