Center for Economic Development and Business Research

Wichita presents industrial revenue bonds

Wichita presents industrial revenue bonds

A presentation by the City of Wichita regarding IRBs is good as far as it goes, which is not far enough. Recently the City of Wichita prepared a short video explaining the city's industrial revenue bonds (IRB) program. The video may be viewed on YouTube by clicking here. Several times the presenters emphasized that in the IRB program, the city does not lend money. They properly identify the true purpose of the program, which is to subsidize companies by allowing them to avoid paying property taxes and possibly sales taxes. Several times the presenters emphasized that the IRB program has…
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Intrust Bank Arena economic impact holds mistake

Intrust Bank Arena economic impact holds mistake

A report on the economic impact of the first ten years of operation of the Intrust Bank Arena in downtown Wichita incorrectly reported tax revenue. Recently Intrust Bank Arena in downtown Wichita promoted the results of an analysis of the economic impact of the arena through its first ten years of operation. [1. INTRUST Bank Arena Reports Economic Impact Study Results Through First 10 Years. February 14, 2020. Available at https://www.intrustbankarena.com/release/366/intrust-bank-arena-reports-economic-impact-study-results-through-first-10-years/.] The arena partnered with the Center for Economic Development and Business Research at Wichita State University to conduct the study. [2. Analysis by CEDBR, version 2, dated 1/6/2020. The…
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Missing from Wichita city documents: Sales tax

Missing from Wichita city documents: Sales tax

It would be simple for the City of Wichita to include additional relevant information regarding economic development incentive decisions. When the Wichita City Council makes decisions regarding economic development incentives, the Center for Economic Development and Business Research at Wichita State University prepares an analysis for the city. The purpose of the analysis is to determine benefit-cost ratios for overlapping governmental jurisdictions, purporting to show that these jurisdictions will receive more in benefits than they pay in costs. An example of the analysis for a large project is here. The city does not make this analysis document available to the…
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Wichita jobs and momentum

Wichita jobs and momentum

Given recent data and the CEDBR forecasts, Wichita's momentum is a slowly growing economy, with the rate of growth declining. The Center for Economic Development and Business Research at Wichita State University provides forecasts for the Wichita economy. In October, CEDBR wrote, "Total nonfarm employment in the Wichita metropolitan area grew 1.2 percent in 2018, with 3,500 new jobs created to bring the area’s employment to 298,600 workers. This was a turnaround after Wichita’s total employment declined by 2,200 jobs in 2017." [1. Center for Economic Development and Business Research at Wichita State University. Wichita Employment Forecast. October 3, 2019.…
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Looking at jobs in Wichita

Looking at jobs in Wichita

Examining job creation in Wichita as compared to the state and the nation. These charts show job changes in Wichita (Wichita MSA, the metropolitan statistical area, as that is the data that is provided monthly), Kansas, and the nation. Each chart shows the percentage, or relative, changes in nonfarm jobs on a common scale, using seasonally adjusted data. The source of data is Bureau of Labor Statistics, part of the United States Department of Labor. These charts are taken from an interactive visualization of this data, which is available here. For the chart starting in May 2015, we can see…
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Job growth in Wichita: Great news?

Job growth in Wichita: Great news?

A tweet from a top Wichita city official promotes great news that really isn't so great. The @WichitaEconDev Twitter account is managed by Scot Rigby, who is Assistant City Manager, Director of Development Services for the City of Wichita. Its tagline is "Promoting, building and preserving Wichita's economic strength to ensure Wichita is the preferred location for new, existing and expanding organizations." The tweet observes "great news" in a Wichita Business Journal article reporting on an employment forecast. Wichita jobs are seen to grow in 2019, according to the forecast. But the Business Journal article didn't provide any useful context.…
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Wichita City Council to consider a clawback

Wichita City Council to consider a clawback

The unrealized potential of an economic development incentive teaches lessons. This week the Wichita City Council will consider an amendment to an economic development incentive agreement. [1. Wichita City Council Agenda Packet for January 8, 2019. Item V-1.] In 2008 the city awarded an incentive to a company in the form of exemption from paying property taxes, estimated by the city to be $93,175 annually at the time the incentive was awarded. [1. Wichita City Council Agenda Packet for February 12, 2008. Item No. 34] The incentive was awarded based on the applicant company creating a certain number of jobs…
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Wichita jobs up

Wichita jobs up

Wichita employment trends are positive for three consecutive months. Seasonally adjusted data from the Bureau of Labor Statistics, part of the United States Department of Labor, shows a rise in the Wichita metropolitan area labor force and job count. This data is through May 2018 and shows three consecutive months of rising employment. This is a reversal of the long term trend for Wichita, in which the labor force and employment have been falling or trending steady while the nation's economy has been growing. An interactive visualization of employment data for all metropolitan areas is available here. While the upward…
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How much will this cost Wichita taxpayers?

How much will this cost Wichita taxpayers?

How much, if anything, do tax abatements cost? Someone asked a question regarding an item on the Wichita City Council agenda today: How much will this cost taxpayers? The item in question is agenda item IV-1: Public Hearing and Request for a Letter of Intent to Issue Industrial Revenue Bonds (WAM Investments #6, LLC). [1. Wichita City Council agenda packet for May 1, 2108.] Attached was an article from the Wichita Business Journal previewing the matter. [1. Daniel McCoy. Wichita City Council to consider $6 million in IRBs for industrial spec building. Wichita Business Journal, April 30, 2018. Available at…
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Spirit Aerosystems incentives reported

Spirit Aerosystems incentives reported

Opinions vary on economic development incentives, but we ought to expect to be told the truth of the details. The Wichita Business Journal has reported on the economic development incentives used to cement the Spirit AeroSystems expansion announced last week. Following are some quotes from its article How Wichita won the battle for Spirit AeroSystems’ expansion. Background on the aspects of the deal can be found at Spirit expands in Wichita. Wichita Business Journal: "And many aren’t shy about bringing cash to the table as an incentive. In Wichita, in the wake of the defeat at the polls in 2014…
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Spirit expands in Wichita

Spirit expands in Wichita

It's good news that Spirit AeroSystems is expanding in Wichita. Let's look at the cost. While it is good news that Spirit AeroSystems is expanding its Wichita operations, it is not without cost to several governmental agencies. Here's a summary of what is publicly available so far. First, a new "entity" will be formed in order to facilitate the construction and ownership of a new building on the Spirit campus. [1. "The CITY, COUNTY and COMPANY would each take action to establish a new legal entity separate and apart from the CITY, COUNTY and COMPANY for development of the PROJECT…
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Downtown Wichita report omits formerly prominent data

Downtown Wichita report omits formerly prominent data

The new State of Downtown Wichita report for 2017 is missing something. What is it, and why is it missing? Recently the Wichita Business Journal reported: When you're Jeff Fluhr, you don't spend much time in park -- it's usually full speed ahead. It was no different when a couple of members of the Wichita Business Journal's newsroom visited with the president of Downtown Wichita and the Greater Wichita Partnership in early October. On this day, Fluhr was excited to pass out copies of the 42-page 2017 "State of Downtown" report, which had just been released. [1. Horwath, Brian. Downtown…
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WichitaLiberty:TV: Wichita economy, Kansas schools

WichitaLiberty:TV: Wichita economy, Kansas schools

In this episode of WichitaLiberty.TV: Karl Peterjohn and Bob Weeks discuss some statistics regarding downtown Wichita and then the Kansas school finance court decision. View below, or click here to view at YouTube. Episode 169, broadcast October 14, 2017. Now, WichitaLiberty.TV has new broadcast times. The regular Sunday broadcasts on KGPT TV channel 26.1 (AT&T U-Verse 49) at 8:30 am, repeated at 4:30 pm, are unchanged. Here is the full broadcast schedule: Saturdays on KGPT channel 26.9 (Newsmax TV) 10:00 am: The new episode 10:30 am: Repeat of last week’s episode 5:00 pm: Repeat of new episode 5:30 pm: Repeat…
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Sales tax incentives yes, but no relief on grocery sales tax

Sales tax incentives yes, but no relief on grocery sales tax

Is it equitable for business firms to pay no sales tax, while low-income families pay sales tax on groceries? Last week I wondered if the city's agenda packet for economic development incentives proposed for BG Products was complete. [1. Weeks, Bob. Wichita Business Journal grants city council excess power. Available at https://wichitaliberty.org/wichita-government/wichita-business-journal-grants-city-council-excess-power/.] Since the city's narrative had no mention of a sales tax exemption, but the accompanying ordinance that was passed authorized a sales tax exemption, I wondered if the analysis performed by the Wichita State University Center for Economic Development and Business Research was correct. Now that I've received…
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Wichita Business Journal grants city council excess power

Wichita Business Journal grants city council excess power

The Wichita Business Journal and the City of Wichita team to provide incorrect coverage and missing analysis. Today the Wichita Business Journal reported: "An $11.5 million expansion of the Wichita operations of BG Products has been given the go-ahead. The Wichita City Council on Tuesday approved the expansion plan and issued industrial revenue bonds for the project." [1. Heck, Josh. Council green-lights company's $11.5M expansion. Wichita Business Journal, September 12, 2017. Available at https://www.bizjournals.com/wichita/news/2017/09/12/council-green-lights-companys-11-5m-expansion.html.] The problem with this reporting is that BG Products was not asking for the city's permission to expand its operations, as the first sentence implies. Nor…
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More Cargill incentives from Wichita detailed

More, but likely not all, of the Cargill incentives will be before the Wichita City Council this week. A division of Cargill, Cargill Meat Solutions Corporation, is moving from an office on North Main Street in downtown Wichita to the site of the former Wichita Eagle building, also in downtown Wichita. Last year it was widely reported that Cargill was considering moving this division to another city. Reports of incentives offers to Cargill from other cities spurred the City of Wichita to offer its own incentives if Cargill would remain in Wichita. This week the city council will consider additional…
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WichitaLiberty.TV: John Todd and Wichita issues

WichitaLiberty.TV: John Todd and Wichita issues

In this episode of WichitaLiberty.TV: John Todd joins Bob Weeks and Karl Peterjohn to discuss issues involving the City of Wichita, including the future of Naftzger Park and economic development. View below, or click here to view at YouTube. Episode 157, broadcast July 9, 2017. Shownotes Wichita Pachyderm Club on Facebook Article link: An information resource regarding the future of Naftzger Park in downtown Wichita Article link: Downtown Wichita business trends: There has been much investment in Downtown Wichita, both public and private. What has been the trend in business activity during this time? Article link: Downtown Wichita jobs, sort…
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Coverage of Downtown Wichita workers

Coverage of Downtown Wichita workers

The Wichita Eagle's coverage of the number of workers in Downtown Wichita isn't fake news, just wrong news. A recent Wichita Eagle article reported on the number of workers in downtown Wichita, designated as zip code 67202: "The 67202 ZIP code had lost nearly 15 percent of its businesses and 20 percent of its employees in the decade ending in 2015, according to the U.S. Census’s County Business Pattern data. The loss of the State Office Building in 2016 and the Wichita school district’s downtown office this summer -- employees are moving to the former Southeast High School -- will…
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Census data for downtown Wichita workers

Census data for downtown Wichita workers

Is the presentation of the number of workers in downtown Wichita an innocent mistake, mere incompetence, or a willful lie? There's a question regarding how many people work in downtown Wichita, the Wichita Eagle reports.[1. Morrison, Oliver. How many people work downtown? Fewer than Census says. Wichita Eagle, May 10, 2017. Available at http://www.kansas.com/news/local/article149848144.html.] Other sources have noticed a discrepancy.[2. Weeks, Bob. Downtown Wichita jobs, sort of. Available at https://wichitaliberty.org/wichita-government/downtown-wichita-jobs/.] At issue is the meaning of "working" in a certain location. Data that the Center for Economic Development and Business Research at Wichita State University supplied to the Wichita Downtown…
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