At the January 12 meeting of the Wichita City Council, several citizens and one council member addressed the “unlevel playing field” and its implications for development in downtown Wichita.
Speaking about the unlevel playing field, council member Janet Miller said: “My own philosophy on that would say that really, incentives are often used to actually level the paying field.” Referring to downtown Wichita, she said that there may be conditions that make development more costly, or there may be other conditions that make development more difficult.
Miller didn’t name specific factors, but often land assembly issues are mentioned as an impediment to developing in downtown Wichita. A parcel may be owned by many parties, the story goes, and it can be difficult and expensive to contact all parties and come to agreement with them.
But land assembly is not an issue with the proposed hotel in WaterWalk. There is no doubt as to land ownership. It’s just one party, and one who is willing to lease it for $1 per year.
Later in the meeting, Miller addressed the issue of unfair advantage that several citizen speakers brought up. Miller said that any developer could build downtown, if they wanted to: “Nothing in the free market prohibits them from doing that. They could take advantage of tax incentives, or not. Nothing prohibits anybody from developing downtown. That said, where are they?”
I can think of several reasons why developers might not want to accept subsidies to develop in downtown Wichita: Some might have an ethical, political, or other objection to accepting taxpayer money as an incentive. Some might not like having the city and its bureaucracy as a business partner. Some may not have supported the right candidates for mayor and city council. Some may not like the scrutiny — such as it is — that comes with accepting taxpayer money.
Some may not want to endure the scorn and contempt that many citizens justifiably feel towards those who accept taxpayer subsidy.
Miller went on to say why there’s not much development downtown: “It’s more difficult, it’s more expensive, and it’s less profitable.”
Regarding these reasons: What about developing this hotel is more difficult than developing other hotels? Why is it more expensive?
Finally, is downtown development really less profitable? Evidence of this comes from people who have multi-million dollar motives to make it appear so. That’s not good enough evidence for me, and it ought not to be good enough for the city council and Wichita city management.
If it is in fact true that downtown development is less profitable, that’s a signal that we ought not to spend any more money — at least public money — downtown. Instead, we should let developers invest their money where they believe it’s most profitable to do so. Profit is the best measure we have as to whether capital is being invested wisely. Profit is the most reliable signal that consumer wants and needs are being met in an efficient manner.
Related posts:
- Citizen activists launch protest petition in response to Wichita City Council vote on hotel development
- Tax increment financing questions topic at Wichita city council meeting
- More questions surround WaterWalk hotel proposal
- City council members on downtown Wichita revitalization
- Wichita city council: more travel on tap
- Wichita City Council, September 15, 2009
- At Wichita city council, special pleading of selfish interests
- At Wichita City Council, why are some doors open, and others closed?
- Wichita Center City South Redevelopment TIF District Testimony
- The resolve of the Wichita City Council
{ 14 comments… read them below or add one }
“She who talks much about what she knows, knows little about what she says”.
Bob, you have hit the nail on the head with this article.
It is obviously not profitable to develop downtown unless subsidies are given and the risk is minimal to a developer.
The city council continues to put the cart before the horse.
As far as Waterwalk development goes, we have gotten off track. We need an attraction not a hotel with no amenities. Where are these hotel guests going to eat breakfast?
It is also my understanding that the hotel developer is a past president of DeBoer’s Candlewood Hotels venture. Do you know if this is true?
Something is rotten in the state of Denmark and it is time this City Council started vetting to the nth degree anyone who wants the use of taxpayer money for private development!
Virtually every citizen in the City of Wichita and Sedgwick County has received some form of public subsidy or public incentive. As the saying goes, “Those who live in glass houses….”
Guess I should clarify, that virtually every citizen who in the past 30 years purchased or built a new house has been the beneficiary of a public subsidy.
And as my mother use to say, ‘If your friend jumps off the bridge are you going to’?
What’s your point Pat?
The point is what’s un-level and what isn’t? The blog once again doesn’t do a sufficient job about “development” in this community. I would say that in all likelihood that many of those who object to public assistance are calling the pot calling the kettle black. This is a political forum for one of which I’m appreciative; however, any reader should take it for what it’s worth because depth in the writing is sometimes lacking.
The point is the city government should not be invlolved in economic development at all. With the exception of providing Fire and Police protection, EMS and roads the government should leave every thing else to an unfettered free market!
It’s time for Bob to come up with these free market business people he keeps talking about. The city needs the income that this hotel will help obtain. $250,000 a year in property tax and having enough rooms to bid on bigger conventions. At no cost to the Wichita taxpayer. Stopping the Bass Pro Shop and stopping this hotel may make some feel powerful but it’s costing taxpayer’s money.
DS, yeah, but that’s not reality. The genie is out of the bottle and it isn’t going back in.
Lonny, if there is no cost to the city taxpayer, where is the money coming from to subsidize these “developers” who ask for help with these “more expensive and less profitable” hotels? What about the cost of not using the property for what it would be used for in an unfettered free market? I have to say, the city certainly wouldn’t “need” more money if it wasn’t already spending too much of ours.
Pat, could you clarify further? Where was my subsidy from the city or county when I bought my house.
Hi
I’m having a REALLY hard time understanding why any Wichita local would even consider blowing more money downtown. You go downtown to Century II, and then you drive back home. If putting a hotel downtown was such a wonderful idea, taxpayers wouldn’t have to pay someone to put the hotel there. If putting a business downtown was such a wonderful idea, taxpayers wouldn’t have to bribe them to put a business in. Of course, since we’ve already bribed the first business, the rest are smart enough to wait for their “just” share of Taxpayer dollars.
Think about it, Century II has been there for 20 years plus, and there’s a whole 2 restaurants within (Wichitan) walking distance (less than 100 yards). Same observation w.r.t. to the Coliseum. Obviously, having somewhere to shop and eat within walking distance to an entertainment venue isn’t important to Wichitans.
We need to elect council members who won’t toss tax $ down the downtown hole anymore. We’ve wasted enough money down there as it is. Eventually, the buildings will gone and the land inexpensive enough to use again. I agree with the Dismal Scientist, we need the city to do it’s job, fire, police and streets. Fire the Economic director and his staff, and get back to basics.
Lonnie, you indicated that we need more hotel rooms in downtown to attract additional conventions, but Mayor Brewer ran out of town the second largest convention besides the Olympics, the Bowling Congress.
Cybex, your comment is totally untrue with respect the Bowling Congress.
Jim. The bank will only provide up to a certain percentage of the total funding necessary. The city will allow some of the future guest taxes received from the hotel to be used as a portion of the funding. I think it is 7 or 11%. Bob would have the exact figures.
Cybex. It was the law department trying to get a better deal that irritated the Bowling Congress. Brewer made changes to identify who would be responsible in the future. And he and others made a special trip to try to recover it.