Tag Archives: Sedgwick county government

For Sedgwick County Commission, too much debate

By moving to end motions and debate, the Sedgwick County Commission isn’t effectively serving citizens and taxpayers.

Yesterday’s meeting of the Sedgwick County Commission offered an opportunity to learn how we can improve local government.

The issue the commission was considering, significant in its own right, is not important to the following discussion. It’s the process that needs improvement.

There was a proposed ordinance. Commissioner Jim Howell offered two amendments — really substitute motions — that altered the proposed ordinance. Each failed by votes of three to two.

Howell had two more motions to offer. But Commissioner David Dennis moved a motion to end the offering of additional motions. In this vote the majority prevailed, and Howell was silenced. Commissioners voting to end debate were Chair Dave Unruh, Michael O’Donnell, and Dennis. Richard Ranzau and Howell opposed the motion to end debate.

The county commission is not a deliberative body like a legislature. The county does not have committees like a legislature. I’m not advocating for the county to form committees, but here’s what is missing from the county process: There is no opportunity for interested parties — often lobbyists, but also regular people — to testify before a committee as legislation is being developed. There is no committee mark-up process in which the text of a bill is crafted and finalized. There is no committee vote that decides whether to recommend the bill to the entire legislative body.

Some of this happens in Sedgwick County, of course, but mostly behind the scenes. There is the county staff meeting Tuesday morning, when the commissioners meet with staff in an informal setting. While this meeting is open to the public, there is rarely news coverage. (Hint to county staff: These meetings could easily be broadcast and archived on the internet without much cost or effort.)

In a legislature, when a bill is considered by the entire body, there is usually an amendment process. They may be many amendments that require time to debate and consider. This process was mentioned by two commission members who have served in the Kansas legislature.

But it seems a majority of Sedgwick County Commission members don’t care for this process.

I understand why some commissioners wanted to end debate. Sometimes amendments to legislation create a moment where legislators have to cast a vote on an issue, often a finely-grained issue. Sometimes that vote is used as a campaign issue in future elections. Those votes may appear in compilations of legislative activity that reveal how legislators vote.

But amendments and debate are part of the legislative process. Commissioner Howell had several amendments that he had prepared in advance. They were not off-the-cuff, spur-of-the-moment ideas. They were crafted to attempt to find a compromise that a majority of commissioners could accept.

But a majority of Sedgwick County Commission members didn’t want that.

Perhaps some commissioners where concerned about the meeting becoming lengthy. We see that from Wichita City Council members. They’re paid a part-time salary, so maybe there’s merit to their carping about long meetings.

But Howell’s amendments took just a few minutes each to consider. And — this is highly relevant — the members of the Sedgwick County Commission are paid a handsome full-time salary. They should not object to the meeting lasting all day, if that’s what it takes to serve the citizens. And citizens were not well-served by the commission’s decision to silence one of its members.

Sedgwick County to consider raising debt limit

Tomorrow the Sedgwick County Commission will consider raising its limit on borrowing for reasons which need to be revealed, and then carefully examined.

Update: By vote of three to two, the commission adopted the second item in the following list, implementing a higher debt limit.

There are three proposals for a policy regarding a debt limit for Sedgwick County government, according to information from the county’s finance office:

  • 2017 cap in current policy (debt service payments as % of budgeted expenditures): 9% = $126,341,621
  • 2017 cap included in March 22 agenda item (debt service payments as % of budgeted expenditures): 10% = $155,303,346
  • 2017 cap using Commissioner Howell’s comments from the bench on March 22 (% of assessed value): 3% = $135,944,585

The third option has intuitive appeal as it pegs the borrowing limit to the county’s primary source of income to pay debt, which is property tax. In any case, taxpayers might wonder why the county is considering any proposal to raise the amount it can borrow.

Why borrow more?

Personal correspondence from Sedgwick County Commissioner Richard Ranzau last month explains the changes the Commission is scheduled to hear tomorrow:

In 2016, the Board of County Commissioners modified the debt policy by limiting the annual debt service obligations (the amount we pay in principal and interest on a yearly basis) to 9% of budgeted expenditures until January 1, 2019, at which time the maximum will decrease to 8%. The previous maximum had been 20% with the County’s annual debt service hovering around 10% of budgeted expenditures. The policy was amended in an effort to place meaningful yet reasonable limits out the County’s borrowing capacity so as to avoid unnecessary habitual borrowing and excessive spending on projects “just because we can.”

The County’s current annual debt service is 8.22% and will fall below 8% in 2018.

No reason or project has been given as to why this change is needed. The county currently has no plans to issue debt for anything in 2017.

A nearby table summarizes and compares the present policy with debt limits that would exist under the new policy, according to the Sedgwick County Financial Office. (There is an alternative interpretation of policy that if used, would limit borrowing in 2019 to $73,218,639.)

Ranzau’s correspondence says there have been no reasons given for the need to change the debt limit, and that there is no plan to issue debt in 2017.

But that’s the county’s public position. Internally, there is consideration of borrowing and bonding in 2017. Some is for projects already completed and paid for.

Borrowing against the Ronald Reagan Building at 271 W. Third St. is being considered in the amount of $4.0 million. That’s $2.1 million of renovations already completed, plus $1.9 million in planned renovations already paid for.

Borrowing against the Downtown Tag Office at 2525 W. Douglas is considered at $2.3 million. This project has been paid for.

Additionally, the county may borrow to pay for the new Law Enforcement Training Center, in the amount of $5.5 million. This building is under construction, but the county has already transferred cash to the capital improvement fund that is designated to pay for this building.

Why would these buildings — some paid for, another for which cash is already set aside — be under consideration for bond issues?

An analogy is in personal finance, where a family might — after many years — pay off the mortgage on their house. Or maybe they saved and purchased the house outright without borrowing.

But then, the family takes out a mortgage — a new loan — on the house to have additional money for current spending. And more current spending is likely what some Commission members have in mind, as there is no need to take out a mortgage on property owned free and clear unless one wants to spend on something else.

Further, there are more projects the county may consider starting in years through 2021, using borrowing through bonds as payment. These total to $59.4 million, which is within the $61.6 million of borrowing allowed just through 2019. (That limit rises each year.)

This seems to contradict the need for a higher debt limit.

Before approving a higher borrowing limit, Sedgwick County Commissioners need to explain the need for the higher limit, and let taxpayers know if they’re about to be saddled with new mortgages on properties we thought we owned outright.

WichitaLiberty.TV: Health care in Kansas and taxes in Sedgwick County

In this episode of WichitaLiberty.TV: Bob Weeks and Karl Peterjohn discuss health care in Kansas and taxes in Sedgwick County. View below, or click here to view at YouTube. Episode 146, broadcast April 9, 2017.

Shownotes

Sedgwick County to consider raising debt limit

This week the Sedgwick County Commission will consider raising its limit on borrowing for reasons which need to be revealed, and then carefully examined.

Update: On Wednesday the Commission decided to defer this item to a future meeting, probably in April.

Personal correspondence from Sedgwick County Commissioner Richard Ranzau explains the changes the Commission is scheduled to hear this Wednesday:

In 2016, the Board of County Commissioners modified the debt policy by limiting the annual debt service obligations (the amount we pay in principal and interest on a yearly basis) to 9% of budgeted expenditures until January 1, 2019, at which time the maximum will decrease to 8%. The previous maximum had been 20% with the County’s annual debt service hovering around 10% of budgeted expenditures. The policy was amended in an effort to place meaningful yet reasonable limits out the County’s borrowing capacity so as to avoid unnecessary habitual borrowing and excessive spending on projects “just because we can.”

The County’s current annual debt service is 8.22% and will fall below 8% in 2018.

No reason or project has been given as to why this change is needed. The county currently has no plans to issue debt for anything in 2017.

A nearby table summarizes and compares the present policy with debt limits that would exist under the new policy, according to the Sedgwick County Financial Office. (There is an alternative interpretation of policy that if used, would limit borrowing in 2019 to $73,218,639.)

Ranzau’s correspondence says there have been no reasons given for the need to change the debt limit, and that there is no plan to issue debt in 2017.

But that’s the county’s public position. Internally, there is consideration of borrowing and bonding in 2017. Some is for projects already completed and paid for.

Borrowing against the Ronald Reagan Building at 271 W. Third St. is being considered in the amount of $4.0 million. That’s $2.1 million of renovations already completed, plus $1.9 million in planned renovations already paid for.

Borrowing against the Downtown Tag Office at 2525 W. Douglas is considered at $2.3 million. This project has been paid for.

Additionally, the county may borrow to pay for the new Law Enforcement Training Center, in the amount of $5.5 million. This building is under construction, but the county has already transferred cash to the capital improvement fund that is designated to pay for this building.

Why would these buildings — some paid for, another for which cash is already set aside — be under consideration for bond issues?

An analogy is in personal finance, where a family might — after many years — pay off the mortgage on their house. Or maybe they saved and purchased the house outright without borrowing.

But then, the family takes out a mortgage — a new loan — on the house to have additional money for current spending. And more current spending is likely what some Commission members have in mind, as there is no need to take out a mortgage on property owned free and clear unless one wants to spend on something else.

Further, there are more projects the county may consider starting in years through 2021, using borrowing through bonds as payment. These total to $59.4 million, which is within the $61.6 million of borrowing allowed just through 2019. (That limit rises each year.)

This seems to contradict the need for a higher debt limit.

Before approving a higher borrowing limit, Sedgwick County Commissioners need to explain the need for the higher limit, and let taxpayers know if they’re about to be saddled with new mortgages on properties we thought we owned outright.

Sedgwick County may abolish scheduled tax decrease

The Sedgwick County Commission had scheduled a reduction in the property tax rate, but may abandon it.

Update: On Wednesday the Commission, by unanimous vote, disapproved the proposed ordinance, thereby leaving the scheduled reduction in place.

On March 23, 2016, the Sedgwick County Commission passed an ordinance, number 51-2016, which stated: “The maximum target for the mill levy to be assessed by Sedgwick County during its budgeting process for budget years 2017 — 2022 is 29.359 mills, and for budget years thereafter is 28.758, subject to requirements mandated by state law.” All commissioners voted in favor.

The resolution to be considered this week sets the maximum target for the mill levy at 29.359. Period. The language reducing the mill levy after 2022 is gone.

Does this count as a tax increase? People will have different perspectives on this.

But it is certain that if passed, this resolution abandons a plan to reduce taxes in the future.

Change in Wichita mill levy rates, year-to-year and cumulative. Click for larger version.
Of note: When formulating a budget each year, the Commission doesn’t set the mill levy by ordinance. Instead, the Commission decides to spend a certain amount. Then, based on the assessed value of taxable property in the county, the mill levy is calculated. The target established by the Commission is just that, a target. Without a strict target, the Sedgwick County might go the path of the City of Wichita, in which the mill levy drifts upward in many years, resulting in a large increase over time. See Wichita property tax rate: Level for the most recent figures.

WichitaLiberty.TV: Immunizations, spending and taxing in Kansas, and getting data from Wichita

In this episode of WichitaLiberty.TV: Should Sedgwick County be in competition with the private sector? What are attitudes towards taxation and spending in Kansas? Finally, what is it like to request data from the City of Wichita? View below, or click here to view at YouTube. Episode 138, broadcast February 12, 2017.

Shownotes

Sedgwick County economic freedom accountability index

A new initiative to provide residents of Sedgwick County with more information about their elected county commissioners.

Indexes of voting behavior are common at the national and state levels. These indexes let voters examine how elected representatives have actually voted, rather than having to rely on their rhetoric and campaign promises. Indexes also provide a useful institutional memory.

Based on my experience on producing the Kansas Economic Freedom Index for several years — a service now provided by Kansas Policy Institute — Sedgwick County will have such an index.

It’s a timely launch, as this week Sedgwick County commissioners will consider a matter that merits inclusion in this index. The item, if passed, will restart the Sedgwick County Health Department’s travel immunizations program. More information from the county commission is available here.

Some of the criteria to be considered in building the index include these, in draft form:

  • Increasing or reducing the overall tax burden.
  • Expanding or contracting agencies, programs, or functions of government.
  • Expanding or reducing government’s power to regulate free market activity.
  • Expanding or reducing government’s role in health care.
  • Improving or harming the environment for economic growth and job creation.
  • Expanding or reducing individual property rights.
  • Protecting the integrity of elections.
  • Rewarding or harming specific individuals, business firms, industries, organizations, or special interest groups.
  • Creating or eliminating functions that can be performed by the private sector.
  • Increasing or decreasing long-term debt.
  • Increasing or decreasing government transparency and open records.
  • Using government funds for political purposes.
  • Encouraging or discouraging citizen participation in government and decision-making.

Why is economic freedom important? Here’s what Milton Friedman had to say in the opening chapter of his monumental work Capitalism and Freedom:

The Relation between Economic Freedom and Political Freedom

It is widely believed that politics and economics are separate and largely unconnected; that individual freedom is a political problem and material welfare an economic problem; and that any kind of political arrangements can be combined with any kind of economic arrangements. The chief contemporary manifestation of this idea is the advocacy of “democratic socialism” by many who condemn out of hand the restrictions on individual freedom imposed by “totalitarian socialism” in Russia, and who are persuaded that it is possible for a country to adopt the essential features of Russian economic arrangements and yet to ensure individual freedom through political arrangements. The thesis of this chapter is that such a view is a delusion, that there is an intimate connection between economics and politics, that only certain arrangements are possible and that, in particular, a society which is socialist cannot also be democratic, in the sense of guaranteeing individual freedom.

Economic arrangements play a dual role in the promotion of a free society. On the one hand, freedom in economic arrangements is itself a component of freedom broadly understood, so economic freedom is an end in itself. In the second place, economic freedom is also an indispensable means toward the achievement of political freedom.

WichitaLiberty.TV: A new season, with co-host Karl Peterjohn

In this episode of WichitaLiberty.TV: Co-host Karl Peterjohn joins Bob Weeks to discuss Karl’s service as county commissioner, the new session of the Kansas Legislature, and choosing a successor to Congressman Mike Pompeo. View below, or click here to view at YouTube. Episode 134, broadcast January 15, 2017.

Year in Review: 2016

Here are highlights from Voice for Liberty for 2016. Was it a good year for the principles of individual liberty, limited government, economic freedom, and free markets in Wichita and Kansas?

Also be sure to view the programs on WichitaLiberty.TV for guests like journalist, novelist, and blogger Bud Norman; Radio talk show host Joseph Ashby; David Bobb, President of Bill of Rights Institute; Heritage Foundation trade expert Bryan Riley; Radio talk show host Andy Hooser; Keen Umbehr; John Chisholm on entrepreneurship; James Rosebush, author of “True Reagan,” Jonathan Williams of American Legislative Exchange Council (ALEC); Gidget Southway, or Danedri Herbert; Lawrence W. Reed, president of the Foundation for Economic Education; and Congressman Mike Pompeo.

January

Kansas legislative resources. Citizens who want to be informed of the happenings of the Kansas Legislature have these resources available.

School choice in Kansas: The haves and have-nots. Kansas non-profit executives work to deny low-income families the school choice opportunities that executive salaries can afford.

Kansas efficiency study released. An interim version of a report presents possibilities of saving the state $2 billion over five years.

Wichita Eagle Publisher Roy Heatherly. Wichita Eagle Publisher Roy Heatherly spoke to the Wichita Pachyderm Club on January 15, 2016. This is an audio presentation.

Pupil-teacher ratios in the states. Kansas ranks near the top of the states in having a low pupil-teacher ratio.

Kansas highway conditions. Has continually “robbing the bank of KDOT” harmed Kansas highways?

Property rights in Wichita: Your roof. The Wichita City Council will attempt to settle a dispute concerning whether a new roof should be allowed to have a vertical appearance rather than the horizontal appearance of the old.

Must it be public schools? A joint statement released by Kansas Association of School Boards, United School Administrators of Kansas, Kansas School Superintendents’ Association, and Kansas National Education Association exposes the attitudes of the Kansas public school establishment.

Kansas schools and other states. A joint statement released by Kansas Association of School Boards, United School Administrators of Kansas, Kansas School Superintendents’ Association, and Kansas National Education Association makes claims about Kansas public schools that aren’t factual.

After years of low standards, Kansas schools adopt truthful standards. In a refreshing change, Kansas schools have adopted realistic standards for students, but only after many years of evaluating students using low standards.

Brownback and Obama stimulus plans. There are useful lessons we can learn from the criticism of Kansas Governor Sam Brownback, including how easy it is to ignore inconvenient lessons of history.

February

Spending and taxing in Kansas. Difficulty balancing the Kansas budget is different from, and has not caused, widespread spending cuts.

In Sedgwick County, choosing your own benchmarks. The Sedgwick County Commission makes a bid for accountability with an economic development agency, but will likely fall short of anything meaningful.

This is why we must eliminate defined-benefit public pensions. Actions considered by the Kansas Legislature demonstrate — again — that governments are not capable of managing defined-benefit pension plans.

Kansas transportation bonds economics worse than told. The economic details of a semi-secret sale of bonds by the State of Kansas are worse than what’s been reported.

Massage business regulations likely to be ineffective, but will be onerous. The Wichita City Council is likely to create a new regulatory regime for massage businesses in response to a problem that is already addressed by strict laws.

Inspector General evaluates Obamacare website. The HHS Inspector General has released an evaluation of the Obamacare website HealthCare.gov, shedding light on the performance of former Kansas Governor Kathleen Sebelius.

Kansas highway spending. An op-ed by an advocate for more highway spending in Kansas needs context and correction.

Brookings Metro Monitor and Wichita. A research project by The Brookings Institution illustrates the poor performance of the Wichita-area economy.

March

Wichita: A conversation for a positive community and city agenda. Wichita City Manager Robert Layton held a discussion titled “What are Wichita’s Strengths and Weaknesses: A Conversation for a Positive Community and City Agenda” at the February 26, 2016 luncheon of the Wichita Pachyderm Club.

In Kansas, teachers unions should stand for retention. A bill requiring teachers unions to stand for retention elections each year would be good for teachers, students, and taxpayers.

In Kansas, doctors may “learn” just by doing their jobs. A proposed bill in Kansas should make us question the rationale of continuing medical education requirements for physicians.

Power of Kansas cities to take property may be expanded. A bill working its way through the Kansas Legislature will give cities additional means to seize property.

Wichita TIF district disbands; taxpayers on the hook. A real estate development in College Hill was not successful. What does this mean for city taxpayers?

Kansas and Colorado, compared. News that a Wichita-based company is moving to Colorado sparked a round of Kansas-bashing, most not based on facts.

In Wichita, the phased approach to water supply can save a bundle. In 2014 the City of Wichita recommended voters spend $250 million on a new water supply. But since voters rejected the tax to support that spending, the cost of providing adequate water has dropped, and dropped a lot.

Wichita Eagle, where are you? The state’s largest newspaper has no good reason to avoid reporting and editorializing on an important issue. But that’s what the Wichita Eagle has done.

April

Wichita on verge of new regulatory regime. The Wichita City Council is likely to create a new regulatory regime for massage businesses in response to a problem that is already addressed by strict laws.

Wichita economic development and capacity. An expansion fueled by incentives is welcome, but illustrates a larger problem with Wichita-area economic development.

Rich States, Poor States, 2106 edition. In Rich States, Poor States, Kansas continues with middle-of-the-pack performance, and fell sharply in the forward-looking forecast.

In Wichita, revealing discussion of property rights. Reaction to the veto of a bill in Kansas reveals the instincts of many government officials, which is to grab more power whenever possible.

‘Trump, Trump, Trump’ … oops! An event in Wichita that made national headlines has so far turned out to be not the story news media enthusiastically promoted.

Wichita doesn’t have this. A small Kansas city provides an example of what Wichita should do.

Kansas continues to snub school choice reform that helps the most vulnerable schoolchildren. Charter schools benefit minority and poor children, yet Kansas does not leverage their benefits, despite having a pressing need to boost the prospects of these children.

Wichita property tax rate: Up again. The City of Wichita says it hasn’t raised its property mill levy in many years. But data shows the mill levy has risen, and its use has shifted from debt service to current consumption.

AFP Foundation wins a battle for free speech for everyone. Americans for Prosperity Foundation achieves a victory for free speech and free association.

Kansas Center for Economic Growth. Kansas Center for Economic Growth, often cited as an authority by Kansas news media and politicians, is not the independent and unbiased source it claims to be.

Under Goossen, Left’s favorite expert, Kansas was admonished by Securities and Exchange Commission. The State of Kansas was ordered to take remedial action to correct material omissions in the state’s financial statements prepared under the leadership of Duane Goossen.

May

Spirit Aerosystems tax relief. Wichita’s largest employer asks to avoid paying millions in taxes, which increases the cost of government for everyone else, including young companies struggling to break through.

Wichita mayor’s counterfactual op-ed. Wichita’s mayor pens an op-ed that is counter to facts that he knows, or should know.

Electioneering in Kansas?. An op-ed written under the banner of a non-profit organization appears to violate the ban on electioneering.

Wichita city council campaign finance reform. Some citizen activists and Wichita city council members believe that a single $500 campaign contribution from a corporation has a corrupting influence. But stacking dozens of the same $500 contributions from executives and spouses of the same corporation? Not a problem.

In Wichita, more sales tax hypocrisy. Another Wichita company that paid to persuade you to vote for higher taxes now seeks to avoid paying those taxes.

Wichita student/teacher ratios. Despite years of purported budget cuts, the Wichita public school district has been able to improve its student/teacher ratios.

June

KPERS payments and Kansas schools. There is a claim that a recent change in the handling of KPERS payments falsely inflates school spending. The Kansas State Department of Education says otherwise.

Regulation in Wichita, a ‘labyrinth of city processes’. Wichita offers special regulatory treatment for special circumstances, widening the gulf between the haves and have-nots.

They really are government schools. What’s wrong with the term “government schools?”

July

Kansas City Star as critic, or apologist. An editorial in the Kansas City Star criticizes a Kansas free-market think tank.

State and local government employee and payroll. Considering all state and local government employees in proportion to population, Kansas has many, compared to other states, and especially so in education.

Kansas government ‘hollowed-out’. Considering all state and local government employees in proportion to population, Kansas has many, compared to other states, and especially so in education.

In Wichita, Meitzner, Clendenin sow seeds of distrust. Comments by two Wichita city council members give citizens more reasons to be cynical and distrusting of politicians.

David Dennis, gleeful regulatory revisionist. David Dennis, candidate for Sedgwick County Commission, rewrites his history of service on the Kansas State Board of Education.

Say no to Kansas taxpayer-funded campaigning. Kansas taxpayers should know their tax dollars are helping staff campaigns for political office.

Roger Marshall campaign setting new standards. Attacks on Tim Huelskamp reveal the worst in political campaigning.

Wichita Metro Chamber of Commerce on the campaign trail. We want to believe that The Wichita Metro Chamber of Commerce and its PAC are a force for good. Why does the PAC need to be deceptive and untruthful?

August

Which Kansas Governor made these proposals?. Cutting spending for higher education, holding K through 12 public school spending steady, sweeping highway money to the general fund, reducing aid to local governments, spending down state reserves, and a huge projected budget gap. Who and when is the following newspaper report referencing?

Wichita Business Journal editorial missed the news on the Wichita economy. A Wichita business newspaper’s editorial ignores the history of our local economy. Even the history that it reported in its own pages.

Sedgwick County Health Department: Services provided. Sedgwick County government trimmed spending on health. What has been the result so far?

School staffing and students. Trends for the nation and each state in teachers, administrators, and students, presented in an interactive visualization.

Intrust Bank Arena loss for 2015 is $4.1 million. The depreciation expense of Intrust Bank Arena in downtown Wichita recognizes and accounts for the sacrifices of the people of Sedgwick County and its visitors to pay for the arena.

School spending in the states. School spending in the states, presented in an interactive visualization.

September

Kansas construction employment. Tip to the Wichita Eagle editorial board: When a lobbying group feeds you statistics, try to learn what they really mean.

Wichita has no city sales tax, except for these. There is no Wichita city retail sales tax, but the city collects tax revenue from citizens when they buy utilities, just like a sales tax.

CID and other incentives approved in downtown Wichita. The Wichita City Council approves economic development incentives, but citizens should not be proud of the discussion and deliberation.

Cost per visitor to Wichita cultural attractions. Wichitans might be surprised to learn the cost of cultural attractions.

GetTheFactsKansas launched. From Kansas Policy Institute and the Kansas Chamber of Commerce, a new website with facts about the Kansas budget, economy, and schools.

The nation’s report card and charter schools.
* An interactive table of NAEP scores for the states and races, broken down by charter school and traditional public school.
* Some states have few or no charter schools.
* In many states, minority students perform better on the NAEP test when in charter schools.

School choice and funding. Opponents of school choice programs argue the programs harm traditional public schools, both financially and in their ability to serve their remaining students. Evidence does not support this position.

October

Public school experts. Do only those within the Kansas public schooling community have a say?

Kansas and Arizona schools. Arizona shows that Kansas is missing out on an opportunity to provide better education at lower cost.

Video in the Kansas Senate. A plan to increase visibility of the Kansas Senate is a good start, and needs to go just one or two steps farther.

Kansas, a frugal state?. Is Kansas a frugal state, compared to others?

Topeka Capital-Journal falls for a story. The editorial boards of two large Kansas newspapers have shown how little effort goes into forming the opinions they foist upon our state.

Kansas revenue estimates. Kansas revenue estimates are frequently in the news and have become a political issue. Here’s a look at them over the past decades.

Kansas school fund balances.
* Kansas school fund balances rose significantly this year, in both absolute dollars and dollars per pupil.
* Kansans might wonder why schools did not spend some of these funds to offset cuts they have contended were necessary.
* The interactive visualization holds data for each district since 2008.

In Wichita, developer welfare under a cloud. A downtown Wichita project receives a small benefit from the city, with no mention of the really big money.

Wichita, give back the Hyatt proceeds. Instead of spending the proceeds of the Hyatt hotel sale, the city should honor those who paid for the hotel — the city’s taxpayers.

Kansas Democrats: They don’t add it up — or they don’t tell us. Kansas Democrats (and some Republicans) are campaigning on some very expensive programs, and they’re aren’t adding it up for us.

November

How would higher Kansas taxes help?. Candidates in Kansas who promise more spending ought to explain just how higher taxes will — purportedly — help the Kansas economy.

Decoding the Kansas teachers union. Explaining to Kansans what the teachers union really means in its public communications.

Kansas school spending: Visualization. An interactive visualization of revenue and spending data for Kansas school districts.

Decoding Duane Goossen. The writing of Duane Goossen, a former Kansas budget director, requires decoding and explanation. This time, his vehicle is “Rise Up, Kansas.”

Decoding the Kansas teachers union. Decoding and deconstructing communications from KNEA, the Kansas teachers union, lets us discover the true purpose of the union.

Government schools’ entitlement mentality. If the Kansas personal income grows, should school spending also rise?

December

Wichita bridges, well memorialized. Drivers on East Twenty-First Street in Wichita are happy that the work on a small bridge is complete, but may not be pleased with one aspect of the project.

Gary Sherrer and Kansas Policy Institute. A former Kansas government official criticizes Kansas Policy Institute.

Wichita to grant property and sales tax relief. Several large employers in Wichita ask to avoid paying millions in taxes, which increases the cost of government for everyone else, including young companies struggling to break through.

Economic development incentives at the margin. The evaluation of economic development incentives in Wichita and Kansas requires thinking at the margin, not the entirety.

The Wichita economy, according to Milken Institute. The performance of the Wichita-area economy, compared to other large cities, is on a downward trend.

State pension cronyism. A new report details the way state pension funds harm workers and taxpayers through cronyism.

In Wichita, converting a hotel into street repairs. In Wichita, it turns out we have to sell a hotel in order to fix our streets.

In Wichita, we’ll not know how this tax money is spent. Despite claims to the contrary, the attitude of the City of Wichita towards citizens’ right to know is poor, and its attitude will likely be reaffirmed this week.

In Sedgwick County, Norton’s misplaced concern for an industry

In the campaign for Sedgwick County Commission, the incumbent Tim Norton touts his experience, judgment, “intellectual stamina, thirst for data and feedback,” and his efforts in economic development. Following, from January 2013, an example of how uninformed he is regarding basic facts about the Kansas economy.

In Sedgwick County, Norton’s misplaced concern for an industry

kansas-gdp-by-industry-for-2010Expressing concern about a large industry that he said is important to Sedgwick County and Kansas, Sedgwick County Commissioner Tim Norton spoke in favor of the need for comprehensive government planning. He cited the commonly-held belief that humans, with their desire for large suburban home lots, are depleting the stock of available farmland.

Specifically, Norton said “Agribusiness is the third largest economic driver in our community, in our region.”

But is this true? Using 2010 figures from the Kansas Statistical Abstract, these are the largest industries in Kansas in terms of gross domestic product:

Agriculture ranks below many other industries, contributing 3.7 percent of Kansas Gross Domestic Product. In most years agriculture would rank even lower, but because of high farm prices in recent years, it ranks higher than it has.

Norton also expressed concern that humans with large home lots would deplete the land available for agriculture. But he need not worry, as I show in Saving farms from people.

Tim Norton: Saving farms from people and their preferences

In the campaign for Sedgwick County Commission, the incumbent Tim Norton touts his experience, judgment, “intellectual stamina, thirst for data and feedback,” and his efforts in economic development. Following, from January 2013, an example of how uninformed he is. You also see his preference for government regulation over economic and personal freedom.

Tim Norton: Saving farms from people and their preferences

Last week at a meeting of the Sedgwick County Commission, Commissioner Tim Norton spoke in favor of the need for comprehensive government planning. In support, he cited the commonly-held belief that humans — especially with their desire for large suburban home lots — are depleting the stock of farmland to the point of being detrimental to agribusiness.

Here’s part of what Norton said (video below):

Now I know people don’t like the idea of sprawl and growth rings and all that, but the truth is there is a balance between where people live and preserving our good agricultural lands and how do you make that work. And that’s being able to sustain part of our economy. Agribusiness is the third largest economic driver in our community, in our region, and to say that we’re okay with every five acre tract being taken up by somebody’s rural residence sounds really good if you’re talking only property rights. But if you’re talking about preserving and sustaining agribusiness you gotta have the land and it’s got to be set aside for that enterprise.

Farms and ranches being driven out of existence by homeowners — that sounds like a problem that might threaten our food supply. But what are the facts?

First, there is an overabundance of farmland in America. There is so much farmland that we pay farmers billions each year to refrain from planting crops. We pay corn farmers billions in subsidies each year and then use their crops for motor fuel, instead of for making fine Kentucky bourbon and taco shells, as God intended.

Considering Sedgwick County, as that is what Norton represents: Despite being the second-most populous county in Kansas and home to its largest city and surrounding suburban communities, Sedgwick County ranks fourth among Kansas counties in the number of farms, thirty-fourth in farmland acres, seventh in total harvested cropland acres, thirty-third in market value of harvested crops, sixty-sixth in market value of livestock, and eighty-seventh in pasture acres. (Data from Kansas Farm Facts 2011, reporting on 2007 farm statistics.)

There’s something else that might ease Commissioner Norton’s concern, if he would only believe in the power of markets over government: That is the price system. If we were truly running short of farmland, crop prices would rise and farmland would become more valuable. Fewer people would be willing to pay the price necessary to have a five-acre home lot.

In fact, if crop prices were high enough, farmers would be buying back the five-acre lots, or perhaps paying homeowners to rent their yards for planting crops or grazing livestock.

In either case, markets — through the price system — provide a solution that doesn’t require politicians and bureaucrats. There are many other areas in which this is true, but government nonetheless insists on regulation and control.

Intrust Bank Arena loss for 2015 is $4.1 million

The depreciation expense of Intrust Bank Arena in downtown Wichita recognizes and accounts for the sacrifices of the people of Sedgwick County and its visitors to pay for the arena.

The true state of the finances of the Intrust Bank Arena in downtown Wichita are not often a subject of public discussion. Arena boosters cite a revenue-sharing arrangement between the county and the arena operator, referring to this as profit or loss. But this arrangement is not an accurate and complete accounting, and hides the true economics of the arena. What’s missing is depreciation expense.

There hasn’t been much talk of the arena’s finances this year. But in February 2015 the Wichita Eagle reported: “The arena’s net income for 2014 came in at $122,853, all of which will go to SMG, the company that operates the facility under contract with the county, Assistant County Manager Ron Holt said Wednesday.” A reading of the minutes for the February 11 meeting of the Sedgwick County Commission finds Holt mentioning depreciation expense not a single time.

Payments by Intrust Bank Arena to Sedgwick County, tableIn December 2014, in a look at the first five years of the arena, its manager told the Wichita Eagle this: “‘We know from a financial standpoint, the building has been successful. Every year, it’s always been in the black, and there are a lot of buildings that don’t have that, so it’s a great achievement,’ said A.J. Boleski, the arena’s general manager.”

I didn’t notice the Eagle opinion page editorializing this year on the release of the arena’s profitability figures. So here’s an example of incomplete editorializing from Rhonda Holman, who opined “Though great news for taxpayers, that oversize check for $255,678 presented to Sedgwick County last week reflected Intrust Bank Arena’s past, specifically the county’s share of 2013 profits.” (Earlier reporting on this topic in the Eagle in 2013 did not mention depreciation expense, either.)

All of these examples are deficient in some way, and contribute only confusion to the search for truthful accounting of the arena’s finances. As shown below, recognizing depreciation expense is vital to understanding profit or loss, and the “net income” referred to above doesn’t include this. In fact, the “net income” cited above isn’t anything that is recognized by standard accounting principles.

The problem with the reporting of Intrust Bank Arena profits

There are at least two ways of looking at the finance of the arena. Most attention is given to the “profit” (or loss) earned by the arena for the county according to an operating agreement between the county and SMG, a company that operates the arena.1

This agreement specifies a revenue sharing mechanism between the county and SMG. For 2105, the accounting method used in this agreement produced a profit of $1,150,206, to be split (not equally) between SMG and the county. The county’s share was $375,103.

While described as “profit” by many, this payment does not represent any sort of “profit” or “earnings” in the usual sense. In fact, the introductory letter that accompanies these calculations warns readers that these are “not intended to be a complete presentation of INTRUST Bank Arena’s financial position and results of operations and are not intended to be a presentation in conformity with accounting principles generally accepted in the United States of America.”2

That bears repeating: This is not a reckoning of profit and loss in any recognized sense. It is simply an agreement between Sedgwick County and SMG as to how SMG is to be paid, and how the county participates.

A much better reckoning of the economics of the Intrust Bank Arena can be found in the 2015 Comprehensive Annual Financial Report for Sedgwick County.3 This document holds additional information about the finances of the Intrust Bank Arena. The CAFR, as described by the county, “… is a review of what occurred financially last year. In that respect, it is a report card of our ability to manage our financial resources.”

Regarding the arena, the CAFR states:

The Arena Fund represents the activity of the INTRUST Bank Arena. The facility is operated by a private company; the county incurs expenses only for certain capital improvements or major repairs and depreciation, and receives as revenue only a share of profits earned by the operator, if any, and naming rights fees. The Arena Fund had an operating loss of $4.1 million. The loss can be attributed to $4.4 million in depreciation expense.

Financial statements in the same document show that $4,443,603 was charged for depreciation in 2015, bringing accumulated depreciation to a total of $30,791,307.

Depreciation expense is not something that is paid out in cash. Sedgwick County didn’t write a check for $4,443,603 to pay depreciation expense. Instead, depreciation accounting provides a way to recognize and account for the cost of long-lived assets over their lifespan. It provides a way to recognize opportunity costs, that is, what could be done with our resources if not spent on the arena.

But not many of our public leaders recognize this. In years past, Commissioner Dave Unruh made remarks that show the severe misunderstanding that he and almost everyone labor under regarding the nature of the spending on the arena: “I want to underscore the fact that the citizens of Sedgwick County voted to pay for this facility in advance. And so not having debt service on it is just a huge benefit to our government and to the citizens, so we can go forward without having to having to worry about making those payments and still show positive cash flow. So it’s still a great benefit to our community and I’m still pleased with this report.”

Earlier in this article we saw examples of the Sedgwick County Assistant Manager, the Intrust Bank Arena manager, and several Wichita Eagle writers making the same mistake.

Intrust Bank Arena commemorative monument
Intrust Bank Arena commemorative monument
The contention — witting or not — of all these people is that the capital investment of $183,625,241 (not including an operating and maintenance reserve) in the arena is merely a historical artifact, something that happened in the past, something that has no bearing today. There is no opportunity cost, according to this view. This attitude, however, disrespects the sacrifices of the people of Sedgwick County and its visitors to raise those funds. Since Kansas is one of the few states that adds sales tax to food, low-income households paid extra sales tax on their groceries to pay for the arena — an arena where they may not be able to afford tickets.

Any honest accounting or reckoning of the performance of Intrust Bank Arena must take depreciation into account. While Unruh is correct that depreciation expense is not a cash expense that affects cash flow, it is an economic fact that can’t be ignored — except by politicians, apparently. The Wichita Eagle aids in promoting this deception.

We see our governmental and civic leaders telling us that we must “run government like a business.” Without frank and realistic discussion of numbers like these and the economic facts they represent, we make decisions based on incomplete and false information.


Notes

  1. Management Agreement between Sedgwick County and SMG. August 1, 2007. Available here.
  2. The Operations of INTRUST Bank Arena, as Managed by SMG. December 31, 2015. Available here.
  3. Sedgwick County. Comprehensive Annual Financial Report of the County of Sedgwick, Kansas for the Year ended December 31, 2015. Available here.

Sedgwick County delinquent tax list for 2015

Here is the delinquent property tax list for Sedgwick County for 2015, summarized and presented in an interactive table that you may sort.

Of note, the two property owners with the largest delinquent balances are the City of Wichita and the Kansas Turnpike Authority.

Inquiry to the City of Wichita reveals that two properties, 3239 E 1st and 3244 E Douglas ($72,282.69 and $47,878.37), are left over from a real estate developer’s default. He, not the city, was responsible for these taxes. A third property is a leased property related to the East Kellogg expansion, and the tenant is responsible for the taxes. For another property, the taxes were paid late, and another was an error that has been corrected.

The Sedgwick County Treasurer issues this caution:

Public notice is hereby given that taxes on Personal Property located in Sedgwick County, State of Kansas, is unpaid, in whole or in part, and here appears the name of each delinquent taxpayer followed by his/her last known address and the total amount of unpaid taxes, penalties and costs.

Some of the names listed may have already paid their personal property taxes or may be awaiting results of a tax grievance or tax protest before paying the taxes due. Unfortunately, it is not practical to delete these names.

I regret any undue embarrassment this may cause those who are still awaiting tax protest decisions.

Linda Kizzire
Sedgwick County Treasurer

Click here to access this data.

WichitaLiberty.TV: A variety of topics, with some good news, but a lot of bad news

In this episode of WichitaLiberty.TV: Wichita’s economic development, Sedgwick County spending, editorials ignoring facts, your house numbers, Kansas governors, taxpayer-funded political campaigns, and the nature of economic competition. View below, or click here to view at YouTube. Episode 127, broadcast August 21, 2016.

Sedgwick County Health Department: Services provided

Sedgwick County government trimmed spending on health. What has been the result so far?

During last year’s Sedgwick County budget hearings, there were warnings that trimming spending on health would decimate the health department’s ability to provide services. But after six months, that hasn’t been the case.

Sedgwick County Health Department services provided. Click for larger.
Sedgwick County Health Department services provided. Click for larger.

The nearby table shows measures of services provided for the first six months of this year compared to the same period the year before. The source of this data is the Sedgwick County Health Department, with my added column calculating the percent change. For most categories of service, the amount provided has risen or fallen slightly. The exception is WIC, the Women, Infants, and Children program. Participation in this program has fallen in Sedgwick County every year since peaking in 2010, mirroring the national trend.1

Average Monthly WIC Participation per 1,000 population, Sedgwick County


Notes

  1. KansasHealthMatters.org. Average Monthly WIC Participation per 1,000 population. Available here.

Wichita Metro Chamber of Commerce on the campaign trail

We want to believe that The Wichita Metro Chamber of Commerce and its PAC are a force for good. Why does the PAC need to be deceptive and untruthful?

Wichita Chamber PAC mailing for David Dennis, excerpt

In a mailing supporting David Dennis, the political arm of the Wichita Metro Chamber of Commerce makes this statement about Karl Peterjohn: “The current county commissioner has spent his life making money from the government sector. When not working for the government, he worked as a registered lobbyist.”

If we look at reality, we find that the candidate who has been a government employee for his entire adult career, according to his bio, is Dennis. Working as a lobbyist is a private sector job, except for taxpayer-funded lobbyists. It’s not “making money from” the government sector. (Even if you disagree with lobbyists not “making money from” the government sector, Peterjohn has worked in private sector jobs that had nothing to do with government. There’s an outright lie from the Chamber.)

Karl Peterjohn lobbying for taxpayers.
Karl Peterjohn lobbying for taxpayers.
As I’m sure the Chamber knows, Karl Peterjohn lobbied on behalf of Kansas taxpayers, working to keep taxes and spending low. The Wichita Chamber, on the other hand, wants more taxes. Voters may remember that the campaign to create a Wichita city sales tax was run by the Wichita Chamber.

Why does the big-taxing Wichita Metro Chamber of Commerce and its PAC support David Dennis? The answer is they want more taxes from you. They must see Dennis as compliant with their desire for higher taxes.

Wichita and U.S. job growth. Click for larger.
Wichita and U.S. job growth. Click for larger.
Wichita and U.S. personal income growth. Click for larger.
Wichita and U.S. personal income growth. Click for larger.
Wichita and U.S. GDP growth. Click for larger.
Wichita and U.S. GDP growth. Click for larger.
It’s not only this. Another mailer says Peterjohn opposed building the Intrust Bank Arena. An accurate statement is Peterjohn opposed raising taxes to fund the arena. Many others held the same belief, as the vote for the arena tax was close, with 48 percent voting no tax for the arena. By the way, that tax was a sales tax, the type that falls disproportionately on low-income families.

We want to believe that our Chamber of Commerce is a force for good. Why does the Chamber need to be deceptive? Why does it lie to voters?

It would be one thing if the Wichita Chamber was a positive force for the Wichita-area economy. But the Chamber and its subsidiaries have been managing economic development for a long time. Nearby is a chart of job growth data from the Bureau of Labor Statistics. Wichita job growth hasn’t always lagged behind the United States. But Wichita is now behind, and as the Wichita Chamber has taken more responsibility for managing our local economy, the gap between Wichita and the country is growing. Wichita is falling behind.

Wichita and United States Job Growth 2016-07

In Sedgwick County, special interest politics on display

Campaign finance reports reveal special interest groups working to elect candidates. Their efforts to mold a candidate’s thinking appear to be working.

Why do people make political campaign contributions? I try to be optimistic. I’m willing to believe that people have sincerely-held beliefs.

But when you look under the covers, I find myself in agreement with Lily Tomlin, who quipped “No matter how cynical you become, it’s never enough to keep up.”

A few days ago I showed how the campaign finance report for David Dennis, a candidate for Sedgwick County Commission, was full of contributions from people who regularly ask government for special favors and subsidy, people who campaigned for the Wichita city sales tax, and Democrats who are ideologically presupposed to higher taxes.1 In other words, people who believe they know better than you how to spend your money, and believe David Dennis will give them more to spend.

But I didn’t go far enough. The Wichita Eagle’s Daniel Salazar found this: “He [Dennis] received at least $4,814 in direct donations from board members of the Sedgwick County Zoological Society.”2

This is classic and explicit special interest group behavior. The group members contribute a little bit to a candidate in expectation of reaping big benefits for their special interest.

Economists call this rent seeking, defined as “An attempt to obtain economic rent (i.e., the portion of income paid to a factor of production in excess of what is needed to keep it employed in its current use) by manipulating the social or political environment in which economic activities occur, rather than by creating new wealth.”3 That obscure term has been partially supplanted by a term more readily understood: cronyism.

And it appears to be working. Salazar’s article quotes Dennis: “I don’t think it’s (funding) adequate based on what I’ve learned. I think we’re going to have to do a complete review of what’s required to run the zoo.”4

There it is. I wonder who David Dennis consulted for his research?


Notes

  1. Weeks, Bob. A look at a David Dennis campaign finance report. Available at wichitaliberty.org/sedgwick-county-government/look-david-dennis-campaign-finance-report/.
  2. Salazar, Daniel. Dennis draws more donations than Peterjohn, including from zoo board members. Wichita Eagle, July 27, 2016. Available at www.kansas.com/news/politics-government/election/article92135002.html.
  3. Wikipedia, en.wikipedia.org/wiki/Rent-seeking
  4. ibid.

Sedgwick County Health Department: Services provided

Sedgwick County government trimmed spending on health. What has been the result so far?

There is an update to this article; see here.

During last year’s Sedgwick County budget hearings, there were warnings that trimming spending on health would decimate the health department’s ability to provide services. But after six months, that hasn’t been the case.

Sedgwick County Health Department Services Provided 2016-07

The nearby table shows measures of services provided for the first six months of this year compared to the same period the year before. The source of this data is the Sedgwick County Health Department, with my added column calculating the percent change. For most categories of service, the amount provided has risen or fallen slightly. The exception is WIC, the Women, Infants, and Children program. Participation in this program has fallen in Sedgwick County every year since peaking in 2010, mirroring the national trend.1

Average Monthly WIC Participation per 1,000 population, Sedgwick County


Notes

  1. KansasHealthMatters.org. Average Monthly WIC Participation per 1,000 population. Available here.

Wichita Eagle opinion watch

Another nonsensical editorial from the Wichita Eagle.

Stop messing with Sedgwick County ZooThis is contained in an editorial urging Sedgwick County government to “stop messing” with the zoo.1

Nor is there any justification for a “non-disparagement clause” in the proposed operating agreement about the zoo director’s public statements, including a prohibition against doing anything to bring the county or society “unwanted or unfavorable publicity.” Even if the county is right — and the society wrong — about the constitutionality of such a gag rule on a public employee, it’s an insult to longtime director Mark Reed’s professionalism and another case of the county trying to pre-empt criticism and punish critics.

It’s common for employees, especially those in managerial and executive positions, to have such agreements. Companies don’t want their employees bad-mouthing the company. I would not be surprised if Holman herself has such an agreement with her employer, the Wichita Eagle. Even if there is no such agreement, can you imagine how long she would last in her job if she started complaining in public about her low pay, her drab office, how her editor censors her best editorials, the crappy publisher, etc.

Employees have protection through whistleblower laws, so if there is corruption or criminality, employees can report it. And the fact that the zoo director is a government employee: I don’t know if that makes a difference, constitutionally speaking.

  1. Holman, Rhonda. Stop messing with Sedgwick County Zoo. Wichita Eagle, July 20, 2016. Available at www.kansas.com/opinion/editorials/article90624332.html.