E-mail:
gwelshim@sedgwick.gov
May 1, 2009 - From her April 15, 2009 article in the Derby Informer:
Tax Increment financing is a public-private partnership concept approved by the Kansas Legislature.
So far, the Sedgwick County Commission has approved TIF districts only within the city of Wichita and most are downtown.
When Wichita draws boundaries for a proposed TIF district, the county has 30 days to say no. If the county takes no action, the city is in control and can plan as many redevelopment projects within this boundary that it desires.
Revenue from all new property valuation, by appreciate or new construction, on every property within the TIF district, is diverted from the city, county and fire departments and schools to pay for a TIF district project for the next 20 years. To make up the shortfall, the county has to impose a slightly higher tax rate which effects Derby, Mulvane, Oaklawn and elsewhere outside Wichita.
The Wichita City Council has accomplished a major "makeover" in downtown Wichita using TIF. However, there is more to do.
City officials say, "it's development we never would have had without TIF." They declare that downtown Wichita is "the beating heart of Sedgwick County," and therefore a good reason to be it's number one priority.
When driving around in downtown Wichita, the results can be seen. The city now has a glorious number of uniquely restored historical office and apartment buildings with tasteful street enhancements and sculpture.
Wichita has received national recognition for its art. It is a beautiful city that reflects our culture, history and ancestry. Areas of downtown that have not received this care and attention are disappointing.
Using the future budgets of other local government units is a pretty good deal for the city. But for a newer county commission wanting to avoid future property tax hikes, it's not so great.
The last TIF district allowed by the county was the Old Town area around the Intrust Bank Arena. That was in 2007.
I voted no for District 5, but it passed with three votes. All of downtown Wichita is now within one TIF district or another.
Under this concept, developers negotiate their redevelopment plan in the TIF district with the city. The developers acquire sites, demolish, remodel or construct buildings and parking lots or garages.
The city then reimburses the developers for the negotiated amount, but the assets of the project remain under the ownership of the developer. A 300-stall parking garage could cost $6 million to build. the income from it probably wouldn't justify this cost, so the use of public funds to build it is deemed justified.
In some cases, the city's contribution is limited to streets and infrastructure, without special taxes to be paid by the developer but still spreading the cost throughout the county.
According to a report in the Wichita Eagle, the city is coming up about $30 million sort in revenues from TIF projects. but the city is claiming success, saying downtown private investment over the past decade of $411 million has outpaced public investment of $394 million.
Wichita is now working to motivate the county, regenerating partnerships for continuing downtown revitalization. The top leadership of the city of Wichita said, "there are visions to be captured, assets and weaknesses to be identified and strategies to be developed; while other cities make compelling cases for revitalizing downtown, we already know what is to be gained."