Kevass Harding

I don’t want to emphasize this too much, as these cases are not in the same league as listing an endorsement from a dead man (Wichita political endorsements from the other side and Campaign mailer listed endorsement from dead man ).

But for completeness — possibly, who knows — here’s the rundown on a few more people who are listed on Lavonta Williams’ campaign literature under the heading “Join us in voting WILLIAMS on April 7:”

Elder Herman Hicks. He lives in Derby.

Reverend Kevass Harding. He lives in Bel Aire, outside the Wichita city limits. But he works at a church in district 1, and is involved in Wichita taxpayer-subsidized real estate development there, too. But he can’t vote in district 1.

Brother Clifford Easiley. He lives in precinct 224, in city council district 2. (It’s spelled “Easily” on the mail piece.)

Reverend Lincoln Montgomery. He lives in precinct 218 in the exclusive Willowbend neighborhood. That’s a long way, figuratively, from the inner-city church he serves in district 1.

Tagged as: Kevass Harding, Lavonta Williams, Wichita city council

KenMar Shopping Center, Funded by Righteousness

by Bob Weeks on March 4, 2009

Can the Lord’s work be funded by taxation? If you’re Reverend Kevass Harding, the answer is sure, why not? He might even think it’s his calling.

Never mind that at its fundamental level, taxation takes money from one person against their will and gives it to another.

Sure, some people will argue that taxes are “the price we pay for civilization” or something like that. Or they will say that since we all benefit from, say, police and fire protection, we all have to pay taxes.

Even if true, these rationalizations are a long way from using taxation to support private real estate development. At least these arguments don’t invoke the name of Jesus. But Harding does in order to accomplish through government, in the form of tax increment financing, what he couldn’t through voluntary action. Is this what Jesus would do?

The Wichita Eagle story KenMar part of pastor’s work in neighborhood tells us of Harding’s belief that “he is doing the Lord’s work, in part, in renovating the run-down KenMar Shopping Center at 13th and Oliver.”

The story also states “The project is a private, for-profit venture, he said, but it springs in part from his spiritual vocation.”

This taking of money, shrouded in morality and spirituality, is even more egregious than most. High atop his moral high horse, Harding believes he is doing good for the community. For the entire city, I’m sure he believes.

Here’s something from another man of religion, C.S. Lewis, reminding us about moral busybodies: “Of all tyrannies, a tyranny exercised for the good of its victims may be the most oppressive. It may be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end, for they do so with the approval of their own conscience.”

Tagged as: Kevass Harding, Tax increment financing, TIF districts, Wichita city government

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Proposition K and TIF Districts Collide

by Bob Weeks on February 18, 2009

in Kansas state government

A recent story in the Wichita Eagle by Dion Lefler (Tax plan could leave city with TIF debt) illustrates the some of the problems that can happen with complex economic development efforts.

The problem in this case lies in the interaction of Proposition K, an effort to reform property tax appraisals in Kansas, and tax increment financing, or TIF districts.

The idea behind TIF districts is that as property is developed, its value will rise enough that the increased property taxes will pay off bonds that the city issued to benefit the developer.

Proposition K, however, alters the way that appraised values rise. According to the Eagle’s analysis of the TIF district benefiting the Ken-Mar shopping center, under Proposition K this district will generate $4.3 million less than what is needed to pay off the bonds.

So what would the city do if faced with this shortfall? The Eagle article suggests “The city could cut spending elsewhere or raise the mill levy to fill the gap.”

That would be a huge windfall to the developer of this project, which is Wichita school board member and Methodist minister Kevass Harding.

But not so fast. The city requires beneficiaries of TIF financing to make up any difference between tax revenues and what’s needed to pay off the bonds. So it appears that the taxpayers may not be on the hook, after all.

The difference, I believe, is that the debt owed to the city would simply be an obligation of Harding and his ownership team. It’s only as good as their ability and willingness to pay. Without Proposition K, the monies needed to pay the bonds would be in the form of property taxes, and the city could take various measures to collect that wouldn’t be available otherwise.

Isn’t this a fine mess? Last summer when this TIF district was being considered, I wondered out loud to the city council “Why don’t we strip away all the confusion and obfuscation surrounding TIF districts and just give the developers $2.5 million?” (See Reverend Kevass Harding’s Wichita TIF District: A Bad Deal in Several Ways.)

I didn’t know then that the confusion and obfuscation would get worse.

Tagged as: Kansas state government, Kevass Harding, TIF districts, Wichita city government

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From Kevass Harding to Lavonta Williams

by Bob Weeks on February 3, 2009

One of the unusual sightings on the campaign finance report filed last month by Lavonta Williams, current Wichita city council member and candidate for re-election, is two contributions totaling $1,000 from Kevass Harding and his wife. These contributions represent the maximum it was possible for two people to give at the time.

These contributions are unusual in that the Hardings don’t show up very often on the lists of contributors to local politicians. On May 20, 2008, Kevass Harding contributed $250 to Donald Betts, Jr. in his campaign for the U.S. House of Representatives. Then on November 24, 2008, Teketa Harding contributed $50 to Kansas House candidate Cheryl McFarthing.

So the Hardings do contribute a little bit now and then. But the $1,000 to council member Williams represents a new step forward for the Hardings.

I have a theory as to why the Hardings made these contributions, but it will have to remain just that, as none of the parties have answered direct questions about this contribution. All that we know for certain is that these contributions were made last June, right before Harding’s application for the Ken-Mar TIF district went before the Wichita city council, of which Lavonta Williams is a member, in July and August.

I’ve asked both parties to explain whether there was or was not a connection between the contributions and the application for the TIF district. Williams answered the question obliquely, not addressing the questions that Wichitans want the answer to (see Lavonta Williams Campaign Contributions Raise a Few Questions). Harding didn’t respond to email or telephone inquiries. But that’s not surprising, as last summer he wouldn’t return my telephone calls. That’s even though I am his constituent, as he is the at-large member of the Wichita school board.

So we’re left to wonder.

Tagged as: Kevass Harding, Lavonta Williams, Wichita city council, Wichita city government

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Prudence Requires Postponement of Wichita TIF District

by Bob Weeks on January 6, 2009

Remarks to be delivered to the Wichita City Council on January 6, 2009.

Mr. Mayor, members of the council:

Last month it was discovered that procedures used to investigate the background of potential city business partners were lacking in some respects. It is now recognized that the process that were in place failed to give city council members information that they needed in order to make a fully-informed decision about the desirability of partnering with a certain development firm.

Today the council is facing a similar situation. As with the previous case, the TIF district itself has already been approved. Now the actual project plan is before you.

Also as with the case last month, these developers made application under the vetting process that this council has now realized was faulty.

To my knowledge, no one has made any allegations that the developers before you today have problems like those that caused the postponement of the project in December. But since these developers applied for and were approved for TIF financing under a system that is now recognized as flawed, we really don’t know.

There is one thing in particular I would like to know: The developers have been asked to agree to what the city calls a “Tax Increment Shortfall Guaranty.” It seems to me that this guaranty is only as good as the financial condition of the guarantor. Has the city examined financial statements of Reverend Harding and his partners, in order to determine whether they have the financial capacity to make good on this commitment, if it becomes necessary?

I think the citizens of Wichita would sleep better at night if these developers would go through the new qualification process that the city is preparing. It’s been reported that this new process will be ready soon. Mr. Mayor, why don’t we wait a month or two and investigate these developers under the new process that is presently being developed? Then the citizens of Wichita can have confidence in this council and the project the taxpayers have been asked to subsidize.

Mr. Mayor and members of the council, there’s another issue that I’d like to call your attention to. That’s the possibility that the city or county — perhaps both — might decide to raise their sales tax rates in exchange for lowering the property tax mill levy. If that were to happen, what would be the impact on TIF districts? The assumptions used in the projection for this TIF district assume that the mill levy in future years is the same as it is today. But if either the city or county were to reduce or eliminate its mill levy, it seems that this — and other — TIF districts would not generate enough property tax to service their debt.

Tagged as: Kevass Harding, Tax increment financing, TIF districts, Wichita city council, Wichita city government

Records Requests Sent Today

by Bob Weeks on September 15, 2008

in Wichita and Kansas schools

Today, I’ve made two records requests under the Kansas Open Records Act.

The first, to USD 259, the Wichita public school district, is this:

All correspondence between USD 259 and Schaefer Johnson Cox Frey Architecture and its representatives from July 1, 2007 to the present. I ask for both written and electronic correspondence such as email. This would include email between USD 259 and Schaefer Johnson Cox Frey Architecture’s email accounts at sjcf.com, and also email accounts of Schaefer Johnson Cox Frey Architecture representatives such as Joe Johnson, Kenton Cox, and Ken Arnold that may not be at an sjcf.com email address.

Then, to the City of Wichita:

All correspondence between the City of Wichita and HH Holdings, LLC and its representatives from January 1, 2007 to the present. I ask for both written and electronic correspondence such as email. This would include email between the City of Wichita and Kevass Harding at both business and personal email addresses, between the City of Wichita and Key Construction and its representatives at both business and personal email addresses, and between the City of Wichita and Landmark Commercial Real Estate at both business and personal email addresses.

Tagged as: Kansas Open Records Act, Kevass Harding, Open records, Schaefer Johnson Cox Frey, TIF districts, Wichita and Kansas schools, Wichita city government

in Free markets,Wichita and Kansas schools

Wichita School District: TIF Action Tests Accountability and Ethics

by Bob Weeks on September 8, 2008

Remarks to be delivered to the board of USD 259, the Wichita public school district, at tonight’s meeting.

Regarding the Ken Mar Redevelopment District: There is simply no way to look at this TIF district other than as a transfer of $2.5 million from the taxpayers to Reverend Harding’s group. Why? According to material prepared by the City of Wichita, the development was $2.5 million short in its funding. But after the creation of the proposed TIF district, the project is fully funded.

Furthermore, as I explained at an earlier meeting of this board, a TIF district allows developers to pay for things — using their own property taxes — that non-TIF developers must pay for themselves. If this were not so, how does the TIF district benefit the development?

Some say that but for the creation of the TIF district, the project would not happen, and therefore no increased tax revenue would be collected. But as recently reported in the Wichita Eagle, these binary, either/or choices are rarely the actual case. For this development, it has been reported that the development already has $11 million in funding. So it appears that the TIF district is not required for something nice to happen to Ken Mar.

The real problem with this TIF district, however, is the conduct of the applicant, who is a member of this board.

At a meeting of the Wichita City Council, Reverend Harding told the council that he had informed his fellow school board members of what he was doing. But two members of this board have told me personally that he did not do that. So there’s a discrepancy somewhere.

Then, I am Reverend Harding’s constituent. He has not responded to my several email and telephone messages with questions about this project.

In meetings of the Wichita City Council and Sedgwick County Commission, he spoke about himself and what he wants to do for the community. But he hasn’t explained why the taxpayers need to subsidize his project with $2.5 million.

He hasn’t explained why he has voted for property tax increases, but now seeks to avoid paying some of those increased taxes. He hasn’t explained why district residents should vote to increase their property taxes — by way of the proposed school bond issue — but desires to avoid paying some of those taxes himself.

And importantly, in his role as school board member, he hasn’t explained why the school district should forgo tax revenue just so Ken Mar can be redeveloped even grander.

Recently the Sedgwick County Commission took up this matter even though they were not required to, just as this board is not required to. The commission heard testimony from the public. The commissioners spoke, and then they voted. Although the commission did not vote the way I asked, the matter was handled with a reasonable degree of openness and transparency.

This board now faces a test of accountability, openness and transparency, and most importantly, ethics. So I ask that this board consider a resolution vetoing the formation of this TIF district. Those members with a conflict of interest may then recuse themselves, and the remaining board members can vote. This must be done tonight, as any delay means automatic consent to the formation of the TIF district.

If this is not done, the citizens of the Wichita school district will wonder if the fix is in, if a political insider used his position and connections for personal gain. They will be justified in wondering.

Tagged as: Kevass Harding, Taxation, TIF districts, Wichita and Kansas schools, Wichita city government

Being Open and Transparent: A Sedgwick County Commissioner’s View

by Bob Weeks on August 28, 2008

in Sedgwick county government

Yesterday (August 27, 2008) I testified briefly at a meeting of the Sedgwick County Commission opposing the formation of a tax increment financing (TIF) district that will benefit a Wichita political insider. My concern that I wanted the commissioners to be aware of is was that the applicant, Wichita school board member Reverend Kevass Harding, has not acted in an open, transparent, and ethical manner.

Commissioner Dave Unruh said that he had thought that Harding was being open and transparent. I suppose if you’re a full-time county commissioner who, presumably, thinks about these matters on a full-time basis, and you have a staff of well-paid professionals to prepare reports and other documents for you, and you have an applicant who is seeking $2.5 million in taxpayer subsidy and would do just about anything to secure that sum, you probably don’t have any problems finding out what you want to know.

But for average citizens who don’t watch county commission meetings on television, who don’t pour over the minutes of the meetings, and who may not read the sketchy coverage of this matter in newspapers, they won’t be aware of what’s going on.

This is another example of how many members of the Wichita City Council and the Sedgwick County Commission are out of touch with the citizens they govern. Three of the last three county commissioners to face the voters for re-election have been defeated. A fourth faces an opponent this November.

My remarks from yesterday:

The concern I have with the formation of this TIF district is that the applicant may be using his political connections for profit, and he has not been forthright with his constituents and the community.

The Wichita school board, of which Reverend Kevass Harding is a member, is required, as is this commission, to consent to the formation of this TIF district. The problem is that since no vote is required by the school board, how can we ask him to declare his conflict of interest and recuse himself from discussion and a vote?

He told the Wichita City Council that he had told city staff and his colleagues on the school board of what he was doing, but it’s not to them that he has en ethical obligation. Instead, his obligation is to the residents of Sedgwick County, the City of Wichita, and USD 259. It is to them that he has the ethical obligation to make sure that this matter is handled with openness and transparency. To my knowledge, he has not done that.

This smacks of a political insider using his connections for personal profit.

Furthermore, the applicant has not been responsive to community concerns over this TIF district. I am Reverend Harding’s constituent, as he is the at-large school board member for USD 259, and I am a resident of that school district. He has not returned my several telephone calls and email messages regarding this matter.

For these reasons, I urge this commission to veto the formation of this TIF district. Let the applicant apply again, this time being open and forthright with the citizens of Sedgwick County, and perhaps this matter can be viewed differently.

Tagged as: Kevass Harding, Sedgwick county government, TIF districts, Wichita city government

Will George Fahnestock Vote For the Wichita School Bond Issue?

by Bob Weeks on August 21, 2008

in Wichita and Kansas schools

Wichita’s mysterious “Boondoggler” posted today that George Fahnestock, the businessman selected to lead the campaign for the proposed bond issue for USD 259, the Wichita public schools, doesn’t live in the Wichita school district. The post is Fahnestock’s Motivation? A map of his house, along with school district boundaries, may be viewed here.

Earlier this year, USD 259 board members Lynn Rogers and Kevass Harding made an issue of the fact that a mailing address used by Citizens For Better Education, an anti-bond group, was in the Maize school district. A “fact check” sheet on USD 259′s website raised the same issue. You can almost feel the glee school district officials must have felt when they learned this.

So when it turns out that the celebrity spokesman for the bond issue doesn’t live in the Wichita school district, I wonder what the board’s reaction will be.

To me, it’s not a very substantive issue. There are many more important reasons to oppose this bond issue. But it raises these questions:

Shouldn’t a celebrity spokesperson for an issue at least be able to vote on the issue? Fahnestock, by not living within the boundaries of USD 259, isn’t eligible to vote for the bond issue.

Then, what is Fahnestock’s motivation for wanting the bond issue passed? As part or whole owner of two companies that work in the heating and air conditioning field, would that be any motivation?

Why is business support for this bond issue so weak that a businessman who lives within the district can’t be found to speak up for the bond?

Tagged as: Kevass Harding, Lynn Rogers, Wichita and Kansas schools

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Wichita’s Naysayers Shortchanged in Council’s Record

by Bob Weeks on August 20, 2008

On August 12, 2008, the Wichita City Council considered the establishment of a TIF district that would benefit Reverend Kevass Harding and his real estate development team. At the council meeting Reverend Harding spoke, and then John Todd spoke, and then myself. We all spoke for, I would guess, roughly the same amount of time.

On Monday August 18 I looked at the city’s website to read the minutes from that meeting. I printed the part of the minutes that covered this item. My printout may be seen in this image. But you don’t need to look at the printout to see what concerns me:

Reverend Harding’s remarks are covered using about 227 words in the minutes.

John’s remarks are covered using 24 words.

Mine are covered using 11 words.

Why the discrepancy? The mayor calls John and I “naysayers.” It is as simple, and as blatant, as that?

(John’s testimony may be read in the post Testimony Opposing Tax Increment Financing for the Ken Mar Redevelopment Project, and mine may be read in Reverend Kevass Harding’s Wichita TIF District: A Bad Deal in Several Ways. I make these remarks available on this website before I deliver my testimony, and I email notice of its posting to all council members plus a few other people at city hall.)

Even more curious, after we three testified, Mayor Carl Brewer delivered his “covered wagon” speech. You can read my transcription of it in Wichita Mayor Carl Brewer, August 12, 2008, and some commentary in Wichita Mayor Carl Brewer Saves Us From Covered Wagons.

But nowhere in the minutes is it recorded that the mayor spoke, much less what he spoke about.

Then, even more curious, the minutes of this meeting are not available on the city council’s website today (Wednesday August 20, 2008). The minutes of the August 5 meeting are missing, too. A short while ago I wrote and asked for an explanation.

August 21, 2008 update: The missing city council minutes have been located. I forgot that they’ve been moved. The page Council Meetings Video On Demand is where minutes may be found.

Tagged as: Carl Brewer, Kevass Harding, TIF districts, Wichita city council, Wichita city government

Wichita Mayor Carl Brewer, August 12, 2008

by Bob Weeks on August 13, 2008

Update: some commentary about these remarks may be read here: Wichita Mayor Carl Brewer Saves Us From Covered Wagons.

Wichita Mayor Carl Brewer delivered these remarks after John Todd and I testified against the creation of a tax increment financing (TIF) district benefiting Wichita minister Kevass Harding. My remarks can be read here: Reverend Kevass Harding’s Wichita TIF District: A Bad Deal in Several Ways. John’s remarks are here: Testimony Opposing Tax Increment Financing for the Ken Mar Redevelopment Project.

I took the time to transcribe the mayor’s remarks not only because I think Wichitans need to know more about his philosophy of the way government should work, but also because they reveal a few of the mayor’s beliefs that I found astonishing. The mayor appeared to be speaking informally, without prepared remarks.

You know, I think that a lot of individuals have a lot of views and opinions about philosophy as to, whether or not, what role the city government should play inside of a community or city. But it’s always interesting to hear various different individuals’ philosophy or their view as to what that role is, and whether or not government or policy makers should have any type of input whatsoever.

I would be afraid, because I’ve had an opportunity to hear some of the views, and under the models of what individuals’ logic and thinking is, if government had not played some kind of role in guiding and identifying how the city was going to grow, how any city was going to grow, I’d be afraid of what that would be. Because we would still be in covered wagons and horses. There would be no change.

Because the stance is let’s not do anything. Just don’t do anything. Hands off. Just let it happen. So if society, if technology, and everything just goes off and leaves you behind, that’s okay. Just don’t do anything. I just thank God we have individuals that have enough gumption to step forward and say I’m willing to make a change, I’m willing to make a difference, I’m willing to improve the community. Because they don’t want to acknowledge the fact that improving the quality of life, improving the various different things, improving bringing in businesses, cleaning up street, cleaning up neighborhoods, doing those things, helping individuals feel good about themselves: they don’t want to acknowledge that those types of things are important, and those types of things, there’s no way you can assess or put a a dollar amount to it.

Not everyone has the luxury to live around a lake, or be able to walk out in their backyard or have someone come over and manicure their yard for them, not everyone has that opportunity. Most have to do that themselves.

But they want an environment, sometimes you have to have individuals to come in and to help you, and I think that this is one of those things that going to provide that.

This community was a healthy thriving community when I was a kid in high school. I used to go in and eat pizza after football games, and all the high school students would go and celebrate.

But, just like anything else, things become old, individuals move on, they’re forgotten in time, maybe the city didn’t make the investments that they should have back then, and they walk off and leave it.

But new we have someone whose interested in trying to revive it. In trying to do something a little different. In trying to instill pride in the neighborhood, trying to create an environment where it’s enticing for individuals to want to come back there, or enticing for individuals to want to live there.

So I must commend those individuals for doing that. But if we say we start today and say that we don’t want to start taking care of communities, then tomorrow we’ll be saying we don’t want more technology, and then the following day we’ll be saying we don’t want public safety, and it won’t take us very long to get back to where we were at back when the city first settled.

So I think this is something that’s a good venture, it’s a good thing for the community, we’ve heard from the community, we’ve seen the actions of the community, we saw it on the news what these communities are doing because they know there’s that light at the end of the tunnel. We’ve seen it on the news. They’ve been reporting it in the media, what this particular community has been doing, and what others around it.

And you know what? The city partnered with them, to help them generate this kind of energy and this type of excitement and this type of pride.

So I think this is something that’s good. And I know that there’s always going to be people who are naysayers, that they’re just not going to be happy. And I don’t want you to let let this to discourage you, and I don’t want the comments that have been heard today to discourage the citizens of those neighborhoods. And to continue to doing the great work that they’re doing, and to continue to have faith, and to continue that there is light at the end of the tunnel, and that there is a value that just can’t be measured of having pride in your community and pride in your neighborhood, and yes we do have a role to be able to help those individuals trying to help themselves.

Tagged as: Carl Brewer, Kevass Harding, Role of government, TIF districts, Wichita city council, Wichita city government

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Reverend Kevass Harding’s Wichita TIF District: A Bad Deal in Several Ways

by Bob Weeks on August 12, 2008

Remarks to be delivered to the Wichita City Council on August 12, 2008.

There’s several reasons why this council should not approve this request for TIF financing.

Material in today’s agenda packet doesn’t specify an amount, but past materials indicated that the project was $2.5 million short of the total needed for the project.

Now some on this council feel that TIF financing isn’t an outright subsidy or gift to the developers of a project. But let me ask you this: if the project is $2.5 million short without TIF financing, and then with City of Wichita TIF financing the project is fully funded, what does that tell you about the value of the TIF district to the developers of this project?

Under TIF financing, the City of Wichita doesn’t directly give developers the money. Instead, the city issues bonds, and then uses the proceeds from the bonds to do things that directly benefit the developers.

Now if the developers borrowed that money from a bank, they’d have to pay back the loan. Each year the developers would have to make the loan payments, and also, just like everyone else, they’d have to pay their property taxes. (Those taxes have increased as now the development is worth more due to the improvements made by the developer. That’s the “increment” in TIF.)

But with a TIF district, the bank is the City of Wichita, which issued bonds to pay for things the developers needed to make the project work. So the developers have to pay back the city. But instead of making payments on a loan from a bank and their property taxes, all the TIF developers have to do is pay their property taxes. By merely paying the same taxes that everyone else has to pay based on the value of their property, their loan is repaid.

That’s why a TIF district allows developers to effectively avoid paying some or all of the increased property taxes on their development. When a development is undertaken without the benefit of a TIF district, developers have to repay loans and pay higher taxes. With a TIF district, all the developers have to pay is higher taxes.

I’m tempted to ask this rhetorical question: Why don’t we strip away all the confusion and obfuscation surrounding TIF districts and just give the developers $2.5 million? This way, we fund the development, the shopping center is remodeled, and we wouldn’t have to come back year after year, evaluating the TIF district to see if it is meeting its goals, perhaps pouring in more funds if it isn’t. Instead, we could just give Reverend Harding’s group $2.5 million, wish them good luck, and be done with it.

But I don’t want to seriously pose that question, because I’m afraid of what this council’s response might be.

Besides this, there’s another reason to oppose this TIF district, or at least insist this be handled in a special way. Reverend Harding is a member of a board that has to give its tacit approval to the formation of this TIF district. That board doesn’t have to take any positive action; all it has to do is nothing. I spoke to this council about the thorny ethical issues surrounding this on July 8th. At that time Reverend Harding said that he informed the city and his colleagues on the Wichita school board of what he was doing. But it’s not to them that he has an ethical obligation. Instead, it is to the citizens of Wichita and the residents of USD 259 that he has the ethical obligation to make sure that this matter is handled with appropriate transparency. To my knowledge, he has not done that.

Finally, I have asked Reverend Harding several questions, but he has not answered me, even though I am his constituent: How much tax revenue will the Wichita public school district forgo if this TIF district is granted? And given Reverend Harding’s votes to increase property taxes and his urging for taxpayers to pass an expanded bond issue, shouldn’t he set an example and pay his full share of taxes like everyone else?

Tagged as: Kevass Harding, Subsidy, Taxation, TIF districts, Wichita and Kansas schools, Wichita city government

Questions Wichita Reverend Kevass Harding Will Not Answer

by Bob Weeks on August 7, 2008

in Wichita and Kansas schools

The Reverend Kevass Harding, a member of the board of USD 259, the Wichita public school district, is also a real estate developer (New life for Ken-Mar Shopping Center: Harding plans to revitalize 13th Street mall, March 14, 2008 Wichita Business Journal).

The problem is that Harding plans to ask the taxpayers of the City of Wichita to pay for part of his development. Not outright, but through a scheme known as tax increment financing, or TIF. Through this scheme, property taxes that the development pays — taxes that would normally be used to fund general city, county, and school district operations — would instead be rebated to Harding and his team of developers. Well, not directly to Harding’s company, but the increased taxes the development will pay will be used to repay bonds that paid for things that benefited the development.

This is bad enough. But Harding, as member of the school board, must know that the effect of the TIF district is that less money will flow to USD 259. As the school board firmly believes that taxpayers never send enough tax money to USD 259, I wonder how board members will react to one of their own seeking to avoid paying property taxes. (Well, not really avoiding paying property taxes, but asking that the taxes he pays directly benefit himself, rather than the city, county, and school district.)

It may turn out, however, that we’ll never know how Harding’s colleagues on the school board feel about this. As explained in Reverend Kevass Harding and His Wichita TIF District, the board of USD 259 doesn’t have to approve the Reverend’s request. All they have to do is nothing, and the request will pass. This is a problem, too.

I’ve sent these questions several times to two email addresses for Reverend Harding. I’ve called and left telephone messages at the number listed on his USD 259 contact page, and at his church, too. He hasn’t responded.

Reverend Harding, if you do decide to answer these questions, I will gladly post your responses. You can contact me here

1. Why is there a financing shortfall for this project that makes it necessary to seek the TIF district financing?

2. The TIF district financing provides your company with the benefit that the property taxes that would otherwise go to various governmental entities would instead be redirected back to your project. Specifically, the funds would be used, according to City of Wichita documents, to pay for site acquisition costs. Would you please comment on the equity of your firm having its site acquisition costs paid for by the public, when most real estate development companies in Wichita do not have this privilege?

3. As a member of the Wichita public school district board, you have voted to increase taxes and are on record as supporting a bond issue that would further increase taxes. Have you calculated how much tax revenue the Wichita school district would forgo if your TIF district request is approved?

4. Please comment on the apparent hypocrisy of your company seeking to avoid paying the property taxes that you, in your role as school board member, demand others pay.

Tagged as: Kevass Harding, TIF districts, Wichita and Kansas schools, Wichita city government

Wichita City Council’s misunderstanding of tax increment financing

by Bob Weeks on July 23, 2008

On July 8, 2008 I testified at a public hearing at a Wichita city council meeting. Afterward, a council member told me that I had a “glaring error” in my arguments. I won’t identify this member in order to avoid embarrassing the member. The minutes of the meeting don’t identify the member who said this, but video is available.

My purpose in testifying that day was not to question the merits of tax increment financing (TIF) districts. Instead, I was identifying an ethics problem that a Wichita school board member has regarding his involvement in a proposed TIF district. (See Reverend Kevass Harding and His Wichita TIF District.) In my testimony I stated, with a qualification, that the applicant for this TIF district was asking for relief from paying some of the property tax for his real estate development. After my testimony, a council member told me that I was wrong, that the TIF district won’t allow someone to avoid paying property taxes. True, I said. It was sloppy for me to have said that without clarification, but it wasn’t the point I was making that day.

But since the city council member brought up the point, let’s examine how TIF districts work. I am sure you will be able to agree that the use of TIF districts allow developers to effectively avoid paying some of their increased property taxes.

In material prepared by Wichita’s Office of Urban Development and presented at the March 18, 2008 city council meeting, we may read this: “The developers have identified a financing shortfall of $2.5 million, for which they are seeking tax increment financing assistance. The preliminary project budget presented to City staff indicates that TIF funds would need to be used for site acquisition costs in order to spend $2.5 million on project costs eligible for TIF funding.”

So without the formation of the TIF district, the developers are $2.5 million short. With the TIF district, they’ve got the money they need. We must conclude, then, that the TIF district financing, no matter what it is used for, is worth $2.5 million to the developers.

Now if the developers borrowed that money from a bank, they’d pay back the loan over some period of years. Each year, out of the cash flow the project generates, the developers would have to make the loan payments, and also, just like everyone else, they’d have to pay their property taxes. (Those taxes have increased as now the development is worth more due to the improvements made by the developer. That’s the “increment” in TIF.)

But with a TIF district, the “bank” is the City of Wichita, which issued bonds to pay for the benefits the developers needed to make the project work. So the developers have to pay back the city. But instead of making payments on a loan from a bank and their property taxes, all the TIF developers have to do is pay their property taxes. By merely paying the same taxes that everyone else has to pay, their loan (the bonds issued by the City of Wichita) is repaid.

That’s why a TIF district allows developers to effectively avoid paying some of the increased property taxes on their development. When a development is undertaken without the benefit of a TIF district, developers have to repay loans and pay higher taxes. With a TIF district, all the developers have to pay is higher taxes.

It is as simple as this.

Tagged as: Kevass Harding, Subsidy, Tax increment financing, Taxation, TIF districts, Wichita city council, Wichita city government