KS credit rating downgraded (tax, live in, refunds)

[kcmo]

Originally Posted by Ztonyg

Heck, there's also a culture within businesses that's developed where businesses expect cities in the Kansas City area to pay for interior renovations to their stores. Case in point, I read that the Hy-Vee supermarket in Leawood is closing because Leawood won't allow Hy-Vee to use $1 million of Community Improvement District funding to pay for renovations to the interior of their store.

In the olden days, businesses renovated their own stores. However, somehow, the prevailing culture now is to let cities renovate stores, it seems.

The fact that a private retail business is even asking for subsidization of interior remodeling and that fact that they are saying they can't survive without such a subsidy is pretty telling of the corporate welfare situation in KC. Nearly all retail and most office space in metro KC including affluent suburbs is subsidized development. Developers now demand it or don't build or as in this case, will vacate and probably go to a new subsidized development elsewhere probably in a greenfield.

And people wonder why sales taxes are so high in the KC area with little basic large city infrastructure to show for it. Regional transit funding, regional parks and rec funding, regional arts funding, regional stadium funding etc, don't exist in KC. But tax payers are propping up nearly every office park and every strip mall in the metropolitan area now. It's all backwards. Malls should be paying their own way and any extra sales tax they produce should be going to things like bike trails, regional light rail etc.

At least Leawood is drawing the line. Most suburban cities will help developers buy and clear land and build structures, but they don't want to set a precedent for going inside the structures just yet. Give it time though. I think both KCK and Lee's Summit have allowed companies to subsidize interiors of brand new businesses. For example much of the interior of Cabela's in KCK was funded with STAR bonds, not just the building itself. What's next, subsidization for inventory? When does it end?

[Ztonyg]

Originally Posted by kcmo

The fact that a private retail business is even asking for subsidization of interior remodeling and that fact that they are saying they can't survive without such a subsidy is pretty telling of the corporate welfare situation in KC. Nearly all retail and most office space in metro KC including affluent suburbs is subsidized development. Developers now demand it or don't build or as in this case, will vacate and probably go to a new subsidized development elsewhere probably in a greenfield.

And people wonder why sales taxes are so high in the KC area with little basic large city infrastructure to show for it. Regional transit funding, regional parks and rec funding, regional arts funding, regional stadium funding etc, don't exist in KC. But tax payers are propping up nearly every office park and every strip mall in the metropolitan area now. It's all backwards. Malls should be paying their own way and any extra sales tax they produce should be going to things like bike trails, regional light rail etc.

At least Leawood is drawing the line. Most suburban cities will help developers buy and clear land and build structures, but they don't want to set a precedent for going inside the structures just yet. Give it time though. I think both KCK and Lee's Summit have allowed companies to subsidize interiors of brand new businesses. For example much of the interior of Cabela's in KCK was funded with STAR bonds, not just the building itself. What's next, subsidization for inventory? When does it end?

They did a lot of that in Phoenix around 10-15 years ago. I believe the Cabelas and Bass Pro Shops that we have here were in developments that were heavily subsidized. Many of the borders between the cities around here have competing oversize "power centers" that are heavily incentivized (including several locations where there are large multiplex movie theaters of competing chains within 1 mile or less of one another). It ended during the recession when cities couldn't afford to play these types of games anymore for retail development. The City of Glendale has almost bankrupted itself with these types of incentives (including several for a shopping center around the suburban hockey arena). The state government is still doing it, to a degree, but only for industrial development or corporate relocation. I'm pretty sure that most, if not all, of the supermarkets around here were renovated by the companies that operate the supermarkets.

Not to get political, but this corporate welfare is something that people that subscribe to the TEA (taxed enough already) Party movement should be focusing their energies on. They certainly raise taxes (as does abuse of traditional welfare mechanisms) and don't really do what they're sold as. At least around here in Arizona, there's essentially a moratorium on cities doing this anymore. The only to create that moratorium is to have regional cooperation amongst the cities.

[luzianne]

Kansas City Missouri businesses get CID funds, the same as Johnson County cities do. The only reason Leawood Hy-Vee is in the news is that LEAWOOD is trying to stop imposing taxes for improvements to businesses.

I think it's funny that if this had happen in KCMO, no one would say a word about it or they would put a whole different spin on it. But since it's Leawood, they act as if Hy-Vee is being greedy and expecting something extraordinary because it's Johnson County. The truth is, they are requesting what they get in other areas INCLUDING KCMO. The only place saying "no" is Leawood.

By rejecting sales tax increase for Hy-Vee, Leawood sticks up for taxpayers - KansasCity.com

[kcmo]

Try again, existing CID districts in KCMO are used for "improving the community". The plaza one is used for parking structures so parking is free, others are used to hire people to clean up sidewalks etc. Some are used to pay for the new streetcar line. There is one up north near zona rosa that is used to fund all the new highway improvements in the tiffany springs area (not the actual retail developments themselves). I don't even agree that they should be use at all because the more you raise the sales tax for that type of stuff, the less room you have in the sales tax to use it as a method to properly fund the same things on a larger scale. There are no cases of a CID overlay tax in KCMO being used to fund interior improvements to a private business.

And it’s just the opposite with the press. Typically, it's KCMO projects that get all the bad press. KCMO is constantly slammed in the press for using TIFs even though KCMO uses them for their intended purposes (urban redevelopment or infrastructure improvements). The press will rip KCMO all day long for subsidizing the P&L district or even the idea of building a convention hotel while a slew of suburban malls on 135th get the same incentives to build greenfield developments in affluent growing areas and super subsidized hotels are built in JoCo all the time such as the OP Convention Center, new hotels in Lenexa (Hyatt Place) and Olathe (Embassy Suites) currently under construction. The Star will mention they are heavily subsidized, but nobody cares that Lenexa is paying for half of a new hotel with incentives when that money should be going to schools etc. Not a single comment and the Star won't cover it any more due to lack of interest. But if a similar hotel is proposed for downtown or the plaza with even less incentives, all hell breaks loose and KCMO becomes a corrupt city, stories get tons of negative online comments, facebook pages are started. Quite hilarious actually.

A new hotel is finally going up in downtown KCMO right now without incentives into a location that will require demolition and structured parking. At the same time those two hotels in Lenexa and Olathe are breaking ground:

Three major hotels UC in metro area. Which ones would you think would need incentives the most?

Suburban greenfield location, 23 million dollar 127 room Hyatt Place hotel. 11 million in incentives via TIF and CID (nearly half the cost of the project)
Hyatt Place hotel is planned for Lenexa - KansasCity.com

Suburban greenfield location, 51 million dollar 200 room Embassy Suites hotel. 20 million in incentives via TIF and CID (nearly half the cost of the project)
Construction to begin on Embassy Suites in Olathe - KansasCity.com

Urban redevelopment location, 46 million dollar 257 room Marriott hotel. 0 dollars in incentives
KC Council committee backs plan for $46 million hotel in the Crossroads - KansasCity.com

So while the joco projects go on withouth so much of a blink, this project in KCMO was killed because of opposition to using incentives much less in incentives:

Urban redevelopment location, 80 million dollar 225 room Hyatt hotel. 12 million dollars in incentives (1/6th the cost of the project) Project killed, no longer active.
Story pulled from KC Star, no link.

It’s comical how much the KS suburbs are subsidized.

[luzianne]

I thought you had me on ignore, kcmo? I don't have you on ignore, but I make it a point not to respond to your posts. And I only read the first sentence of your post.

[kcmo]

I do ignore your posts, but I noticed a false post and responded of which you blew off. If I were from Kansas and didn't want to acknowledge that everything in KS is propped up by tax payers , I would blow that post off too. Some things don't change!

PS, I don't care if you read that post or not, it was not posted to get into with you, heck you can't even discuss these these topics. It was posted for others to see what is going on with CIDs and to show that what you posted was incorrect.

[luzianne]

It's not just Kansas where everything is propped up by taxpayers. Missouri does it too. And I have been a resident/taxpayer in both Kansas and Missouri, and I have to say that my tax dollars are better spend in Kansas. The taxes are comparable in both states. So I choose to live in Kansas, where the quality of life, to me, is better.

PS - I blow off all your posts. I'm quite capable of discussing the topics, but will not discuss them with you.

[kcmo]

Originally Posted by luzianne

PS - I blow off all your posts.

I'll hold you to that one!

[luzianne]

Originally Posted by kcmo

I'll hold you to that one!

I've been doing it for a long time. The only time I ever comment on your posts is if you are making a comment directly to me or about something I have posted. But I probably miss a lot of your comments directed at me because if I look at your posts at all, it's just a cursory glance.

[kcmo]

Originally Posted by luzianne

I've been doing it for a long time. The only time I ever comment on your posts is if you are making a comment directly to me or about something I have posted. But I probably miss a lot of your comments directed at me because if I look at your posts at all, it's just a cursory glance.

promise?