When pursuing a large Wichita city contract, did the winning company lobby all council members, or primarily Mayor Jeff Longwell?
The role of Wichita Mayor Jeff Longwell in the awarding of the contract for the new Wichita water plant has been in the news. A recent Wichita Eagle article showed how the mayor steered the award to a company other than the company recommended by the city’s selection committee. 1
Central to the story is the relationship between the mayor and the company he favored. There was, according to Eagle reporting, a close relationship including a cash gift that was not disclosed 2 and some eerily chummy emails. 3
The mayor, however, downplayed his role. In a response from Longwell posted on the city’s Facebook page, he said he is part of a team: “A team that deliberately keeps each other in check. We question and challenge each step, and that is an intentional process designed to ensure we have the best deal for our city.” 4
Some council members agree. In the Eagle article, two council members were interviewed, Brandon Johnson (district 1, northeast Wichita) and James Clendenin (district 3, southeast and south Wichita):
Johnson and Clendenin both downplayed Longwell’s role in awarding the contract, saying the mayor is just one vote.
“You give the mayor too much credit,” Johnson said.
“Yeah, this idea that the mayor of the city of Wichita has enough power to make any decision he would like is something that I think is a misconception,” Clendenin said.
What, then, is the power of the mayor to lead or steer the council in his preferred direction?
The answer to this question holds the answer: Did the winning company (Wichita Water Partners) lobby, flatter, or gift any Wichita City Council members with anything approaching the consideration directed to Mayor Jeff Longwell?
“Before Longwell cast the deciding vote, the president of one of the Water Partners’ companies paid for Longwell to enter a $1,000-per-person charity golf tournament. … Nor did Longwell disclose the $1,000 entry fee on a state ethics form for local officials that he filed in February.” ↩
“They frequently referred to each other in emails by nicknames — Your Eminence, His Highness, Homecoming Queen, Eye Candy, Jethro and Wine Delivery Guy, after Young, the president of PEC, offered to drop off to Longwell leftover wine from a previous dinner party.” ↩
From the Wichita Pachyderm Club this week: Wichita mayoral candidates Jeff Longwell and Brandon Whipple. This audio presentation or podcast was recorded on September 27, 2019. Todd Johnson is the moderator.
Wichita economic development officials use a convoluted method of estimating the population of downtown Wichita, producing a number much higher than Census Bureau estimates.
How many people live in downtown Wichita? The answer, according to Downtown Wichita, is 2,749.
This value comes from the 2019 State of Downtown Report, published by Downtown Wichita. 1 It is for zip code 67202, which is commonly recognized as greater downtown Wichita. While this report highlights the number of people living in downtown Wichita, it no longer reports the number of people working in downtown. 2
How does Downtown Wichita arrive at the number of residents in downtown? An endnote from the report gives the details:
The 2010 U.S. Census states the population in the 67202 area code [sic] is 1,393. Per Downtown Wichita records, 1,228 units rental units have opened in the Downtown SSMID district since 2010 when the Census was taken. Per data provided directly from the Downtown residential rental properties, the absorption rates of the market rate units has an average of 85%. Per the U.S. Census Bureau, 2013-2017 American Community Survey 5-Year Estimates, the average size of renter-occupied units is 1.3 persons. Therefore, an estimate for the current population is 2,749. 3
What Downtown Wichita has done is to take a reliable figure (the 2010 decennial census) and extrapolate forward to 2018. (Presumably 2018, as the report doesn’t say.)
There is a problem with this approach. The DW calculation makes use of two estimates, absorption rate 4 and size of renter-occupied units. Each of these is an estimate that has its own error probabilities, and those errors compound when multiplied.
There is no need to go through this roundabout calculation, as the Census Bureau has provided an estimate for the population of downtown in 2017. Data from the American Community Survey 5 estimates that the population in downtown Wichita for 2017 was 1,587, with a 90 percent confidence interval of plus or minus 221. 6 This means the Census Bureau is confident the population of downtown Wichita in 2017 was in the range of 1,366 to 1,808, that confidence factor being 90 percent. (2018 values should be available soon.)
But Downtown Wichita says the population of downtown is 2,319, which is far — really far — outside the range the Census Bureau gives for the 2017 population. While Downtown Wichita’s population estimate is probably for 2018, it still lies far outside the range of probability, based on Census Bureau estimates.
A nearby chart plots the Census Bureau’s population estimates (labeled ACS, for American Community Survey) with the lower and upper bounds of 90 percent confidence levels. This is compared with Downtown Wichita’s population estimate. From 2015 to 2017, Downtown Wichita’s population estimates are far above the Census Bureau’s estimates. The probability that Downtown Wichita’s figures are correct is vanishingly small.
It’s curious that Downtown Wichita, if it wants to know how many people live in downtown, doesn’t simply use the Census Bureau estimate of population. That estimate is available annually in the Bureau’s American Community Survey. Downtown Wichita didn’t use that number, but it relied on the same body of data to get “average size of renter-occupied units.”
Why would Downtown Wichita use the Census Bureau for one datum but not another, especially when the Census Bureau data reports the statistic Downtown Wichita is trying to estimate in a roundabout manner?
It’s simple. DW’s calculations produce 2,319 people living in downtown. The Census Bureau estimate is a much smaller number: 1,587.
By the way, DW’s calculations start with the 2010 Census Bureau population for downtown. Of the downtown population of 1,393 that year, 253 were men living in institutions like the Kansas Department of Corrections Wichita Work Release facility at Emporia and Waterman Streets. It has a capacity of 250. 7
“Absorption is the amount of space or units leased within a market or submarket over a given period of time (usually one year). Absorption considers both construction of new space and demolition or removal from the market of existing space.” Institute of Real Estate Management. Calculating Absorption. Available at https://www.irem.org/education/learning-toolbox/calculating-absorption. ↩
U.S. Census Bureau, 2013-2017 American Community Survey 5-Year Estimates ↩
From the Wichita Pachyderm Club this week: Wichita city council candidates from districts 4 and 5. This audio presentation or podcast was recorded on September 20, 2019. Todd Johnson is the moderator.
Wichita city hall again places a controversial matter on the consent agenda, where it might pass without notice.
Should the City of Wichita lease part of a new park to a private entity for its exclusive use? That’s what the Wichita City Council will consider this week. But there are issues apart from the lease itself.
The subject of the item this week is Naftzger Park in downtown Wichita. The new building on the east side of the park has ground floor retail space, including a restaurant. To have an outdoor patio area in which alcohol is served, the restaurant’s patio must be fenced in. Furthermore, the proposed patio sits on park land, which requires execution of a lease.
The problem is that plans for the fenced patio were not known by the mayor, the city council, or the public until last week when the city council agenda for its September 10, 2019 meeting was released.
Not only that, the item was placed on the consent agenda. That’s a section of the meeting where a number of agenda items are considered and voted on in bulk without discussion, unless a council member asks to “pull” an item. The consent agenda usually holds non-controversial items.
But the redesign of Naftzger Park has been controversial. There was much community discussion about the design, and not everyone was happy. The park and the surrounding development have received millions in taxpayer subsidy, which adds to the controversy.
So it’s surprising that anything involving this park would be handled on a consent agenda. But in February the council considered an error in the park design, correction of which cost $115,000. That was passed on the consent agenda with no discussion.
Where is the fence? Click for larger.Now, another matter regarding Naftzger Park was placed on the consent agenda, and it is definitely controversial, as is any plan to lease city park land to private interests. Credit to Wichita City Council Member Bryan Frye (district 5, west and northwest Wichita) for objecting to the consent agenda placement, according to Wichita Eaglereporting.
The city has had other trouble with its consent agenda. This summer the lease of airport land to a hotel developer was placed on the consent agenda. The lease was found to have errors and the matter was delayed twice.
According to the minutes of the July 16 council meeting, Mayor Longwell referenced “a mistake made by staff to put this on consent agenda without the knowledge of any Council Member.”
On the same matter, the Wichita Eagle reported: “‘We really don’t like, in this case, last-second changes that are brought to us,’ Longwell said. ‘And it’s not fair to the community to have last-second changes presented to the council and then ask us to vote on it.’” A few days later the newspaper reported, “On Friday, Longwell said he plans to ask the council to change its policies so “every negotiated agreement goes on a regular agenda, not consent.”
Someone didn’t get the message, it seems.
Should the city lease part of Naftzger Park for exclusive private use? That’s an issue worthy of discussion. But two things are certain:
Any lease should have been part of the original discussion on the redesign of Naftzger Park two years ago.
And, stuff like this shouldn’t be on the consent agenda.
The City of Wichita property tax mill levy was unchanged for 2018.
Wichita mill levy rates. This table holds only the taxes levied by the City of Wichita and not any overlapping jurisdictions.In 1994 the City of Wichita mill levy rate — the rate at which property is taxed — was 31.290. In 2018 it was 32.667, based on the city’s Comprehensive Annual Financial Report and the Sedgwick County Clerk. That’s an increase of 1.377 mills, or 4.40 percent, since 1994. (These are for taxes levied by the City of Wichita only, and do not include any overlapping jurisdictions.)
The rate for 2018 was unchanged from 2017 and follows two years of small decreases.
Wichita mill levy rates. Click for larger version.The Wichita City Council does not set the mill levy rate. Instead, the rate is set by the county based on the city’s budgeted spending and the assessed value of taxable property subject to Wichita taxation.
While the city council doesn’t have control over the assessed value of property in its jurisdiction, it does have control over the amount it decides to spend. As can be seen in the chart of changes in the mill levy, the city usually decides to spend more than the previous year’s mill levy generates in taxes. Therefore, tax rates usually rise.
Change in Wichita mill levy rates, year-to-year and cumulative. Click for larger version.It’s more common for the mill levy to rise rather than to fall. In those years, the council does not take responsibility for the increase, insisting that the rate has not gone up.
An increase of 4.40 percent over more than two decades may not seem like much of an increase. But this is an increase in a rate of taxation, not tax revenue. As property values rise, property tax bills rise, even if the mill levy rate is unchanged.
The total amount of property tax levied is the mill levy rate multiplied by the assessed value of taxable property. This amount has risen, due to these factors:
Appreciation in the value of property
An increase in the amount of property
Spending decisions made by the Wichita City Council
Application of tax revenue has shifted
Wichita mill levy, percent dedicated to debt service. Click for larger version.The allocation of city property tax revenue has shifted over the years. According to the 2010 City Manager’s Policy Message, page CM-2, “One mill of property tax revenue will be shifted from the Debt Service Fund to the General Fund. In 2011 and 2012, one mill of property tax will be shifted to the General Fund to provide supplemental financing. The shift will last two years, and in 2013, one mill will be shifted back to the Debt Service Fund. The additional millage will provide a combined $5 million for economic development opportunities.”
in 2018 the city budget held this regarding the debt service fund: “In both 2013 and 2014, 0.5 mills were shifted back to the Debt Service Fund.”
Taxes a homeowner pays
Following, a chart and table showing the taxes paid to the City of Wichita for a hypothetical home. This includes changes in the value of the home (based on U.S. Federal Housing Finance Agency, All-Transactions House Price Index for Wichita, KS (MSA) [ATNHPIUS48620Q]) and inflation (based on Consumer Price Index Series II: CUUR0000SA0, U.S. city average, All items, Base Period 1982-84=100, Bureau of Labor Statistics). Click for larger versions.
The City of Wichita has submitted an application to the Federal Transit Administration for a project described as “Delano Multimodal Center and Park-N-Ride.” The application was supplied in several documents. I’ve combined them in what I hope is the correct order. Click here to view.
Map submitted with application. Click for larger.The “Demonstration of Need” section starts with this: “The successful approval of the City of Wichita application will transform public transit in our city as we know it. Not only would a new, multi-modal center be key to the growth of the west bank area and mitigate increased traffic, it would replace our old and antiquated transit center.”
Of note, the application mentions a partnership “consisting of private a sports complex.” I had thought that the City of Wichita would own the new baseball stadium.
Following is more material from this section of the application:
This center is envisioned as containing transit amenities to handle connections from commuter service, connect-ability to the downtown circulator, transfer points to routes meeting education, employment and economic development key to the growth of the west bank area of the Arkansas River. Also integral to the boom in this area is a new multi-million dollar public-private economic partnership consisting of private a sports complex and other economic drivers slated to open in April of 2020. All of which presents countless public transit opportunities. Designed to rest in an urban setting, the development will have limited on-site parking and public transit will be key in providing accessibility for patrons.
With an evolving Wichita Transit and the growth of areas west and east of the city center, it is vital that services connect those areas to downtown employment (which exceeds 5,000 jobs) and to large employers (exceeding 11,000 people). The multi-modal transit center will provide vast opportunities that will meet and enhance Wichita’s education, employment and economic development needs An increase in demand for this types of service could see a huge advantage in the existence of a multi-modal center that contains transit-oriented development (TOD) space, up to 543 parking spaces as well as connect-ability to transit. This also becomes a quick charge area for our electric bus fleet (11 on order and a new application for more), improves access to our bike share program as well as any potential autonomous circulators which become possible with this type of facility.
Wichita Transit continues to explore and adopt new and innovative modes of transportation. However, our aged and outdated transit center, located at William and Emporia Streets is an old design that doesn’t always meet our ever increasing needs. Due to its inner city location, it requires constant policing and also sits less than 100 feet from Intrust Arena which hosts numerous events that necessitate closing the streets around the center; making bus operations next to impossible with foot traffic, cars and event activities so close. The land has also seen a significant increase in its value and will eventually be landlocked by future economic development by the private sector, further reducing accessibility. The multi-modal center will be a multi-functional transit center that works in today’s modern world.
Capital
Without this funding, it will be extremely difficult to fund a multi-modal center. The funding mix utilized for capital purchases up to now (FTA sections 5307 & 5339, and FHWA’s Surface Transportation Program (STP) and Congestion, Mitigation, and Air Quality (CMAQ), etc.) is not sufficient to close the funding gap to replace the transit center, as they are earmarked for normal operations (preventive maintenance, planning, operations, and other capital needs such as fare-boxes, bus IT needs, lift systems, support vehicles, security projects and bus replacements). Possible future CMAQ or STP funding will not be available to Wichita Transit until after 2020, but planned uses of eligible funds in 2021 and 2022 is for para-transit van replacement.
In 2017, Wichita Transit forged many partnership initiatives to increase economic and mobility opportunities for the Wichita community, partnerships that resulted in a 9% increase in fixed route ridership in 2018. Our partners include USD259, Wichita State University (WSU), WSU Tech, Regional Economic Area Partnership (REAP) and Workforce Alliance of South Central Kansas. In order for these minor accomplishments to become major successes it is essential that we create an impactful sustainable public transit system. This multi-modal facility would go a long way toward achieving that goal.
Above all, there is a latent demand for public transportation that is not met by the present system. While changing attitudes about automobile ownership and driving are evident among the younger population, schedules and route coverage limit expanded ridership. To date, the hub-and-spoke system has limited Wichita Transit from playing a role in adding jobs and residents downtown or creating links between employers and employees in the area workforce.
Wichita Transit has significant capital funding needs; needs that are also funded from the federal apportionment. Using the apportionment to fund operating costs is starving funding needed for capital replacements. The current transit service, system design, route configurations can be challenging for all but the most dedicated riders, who are most often transit-dependent. Providing a sustainable service level reflective of the results of citizen engagement efforts and generating improved outcomes. comparable to the local commitment to public transportation found in other communities.
Service improvement scenarios have been identified in addition to the current system – Introducing a modified grid system to improve connectivity, eliminate transfers, and shorten travel times, express bus services from Andover, Derby, Park City and West Wichita or Goddard would be introduced. Local service would also be extended to the City of Maize and Haysville.
Service enhancements would be expected to generate outcomes, including increased citizen satisfaction with the level of transit services, improved financial sustainability, and increased ridership, particularly ridership supporting downtown and economic development purposes.
It is unfortunate that Wichita city and metro populations are falling. It is unimaginable that our city’s top leader is not aware of the latest population trends.
Mayor Longwell said he wasn’t aware of the estimate, telling the audience, “census estimates are different than the census.” Absolutely correct. The census, which is an attempt to count the population, happens only once every ten years, while census estimates for population are produced annually. With only decennial data, we wouldn’t know much about recent developments.
Estimates are important. We use them in numerous circumstances when producing a count would be expensive. Mayor Longwell said he hasn’t seen estimates for population, but he knows the unemployment rate for Wichita. That is also an estimate produced by a different branch of the federal government. The city uses many estimates. The “City Overview” section of the budget document starts with: “Wichita, the largest city in Kansas with a population 389,965 …” The footnote gives the source of the data as “2015 Census population estimates.”
On Call the Mayor, Longwell said, “our population in Wichita has grown from 2000 by nearly 40,000 people.” Interestingly, if the mayor doesn’t want to use estimates, he should have said the City of Wichita population grew by about 30,000, as that is the difference between the 2010 and 2000 census counts. Based on the estimate of city population for 2018, growth has been almost 37,000.
Wichita and top 100 city population, annual change, through 2018. Click for larger.It’s too bad that the mayor doesn’t know the latest population estimates, because they don’t hold good news. The City of Wichita proper lost 1,052 in population from 2017 to 2018, a decline of 0.27 percent. 1 For the same period, the Wichita Metropolitan Statistical Area population fell by 740 persons, or 0.11 percent. Net domestic migration for the Wichita metro area showed a loss of 3,023 persons, or 0.47 percent of the population. This change, on a proportional basis, was 301st among the 383 largest metro areas. 2
Wichita’s unemployment rate is low, and has been declining
One of the reasons the Wichita unemployment rate is low is because of a declining labor force. As can be seen in the nearby chart, the unemployment rate (green line) has fallen — and by a lot — since the end of the last recession in 2009. (Click here for an interactive version of the chart.) But the unemployment rate depends on two things, one being the labor force as the denominator of a fraction, or ratio. If the denominator (labor force) falls at a greater rate than the numerator, the unemployment rate will fall. That is what has happened in Wichita.
Wichita labor force and employment. Click for larger.
For example, on January 1, 2010, the labor force in Wichita was 320,287 and the number of unemployed persons was 28,523, resulting in an unemployment rate of 8.9 percent. The number of employed persons was 291,764.
Then, on April 1, 2019, the labor force in Wichita was 311,114 (falling by 9,173 or 2.9 percent) and the number of unemployed persons was 11,576 (falling by 16,947 or 59.4 percent), resulting in an unemployment rate of 3.7 percent. The number of employed persons was 299,538 (rising by 7,774 or 2.7 percent).
If, for example, the current labor force was the same size as on January 1, 2010, and we have the same number of employed people as we do today, there would be 20,749 unemployed people, and the unemployment rate would be 6.5 percent instead of 3.7 percent. (We don’t know what would have happened had the labor force not fallen, but this is an example of how the arithmetic works.)
This is unfortunate
It is unfortunate that the city and metro populations are falling. It is unimaginable that our city’s top leader is not aware of the latest population trends. These numbers are easy to find. Until recently, they would be reported in local news media.
But the city has an economic development staff that ought to be aware of these numbers. There is the Greater Wichita Partnership, responsible for shepherding economic development. There is a city manager, assistant city manager, six city council members, and a fleet of bureaucrats. Didn’t any of these people know the population has declined? If not, why not?
And if any knew the population was declining and didn’t tell the mayor, well, that’s another problem.
Transcript from Call the Mayor, May 30, 2019
Host: We have a Facebook question from Bob. Could you please comment on the recent US Census Bureau population estimates for the city of Wichita and Wichita metro stat area for the year ending July 1, 2018. It’s very specific but the latest on the census for Wichita.
Longwell: So the census estimates are different than the census and so I’m not I haven’t seen the census estimate data specifically. I know the region … Wichita is becoming a destination for health care and so you’re starting to see many people in rural Kansas migrate to big cities and we’re no different. I know that our population in Wichita has grown from 2000 by nearly 40,000 people and so we will continue to see that growth and right now we need more people. We need people to fill these jobs that are in Wichita. Our unemployment’s at historic low right now.
To view the program on YouTube starting at the point of this question, click here.
The Wichita City Council plans to use the consent agenda to vote on an item containing confusing language.
For the Tuesday June 25, 2019 meeting of the Wichita City Council meeting, item No. II-17 concerns the city leasing land to a company wanting to build and operate a new hotel near the airport. 1 The agenda packet holds this language:
“Upon execution of the lease, WEH will provide a $2 million good faith security deposit in escrow with the Airport to ensure timely construction of the hotel. Upon completion of the roof construction, the deposit will be available to WEH for additional construction costs. WEH will invest a minimum of $12 million of private funds to build and equip the property, which the structure will be owned by the WAA in accordance with existing policy. During the life of the lease, WEH is required to make periodic capital improvements and re-investment obligations in order to maintain its franchise agreement with a national flag hotel.” (emphasis added)
(WEH is Wichita Eisenhower Hotel, LLC, a private company formed to construct and operate the hotel. WAA is the Wichita Airport Authority, which is the same as the Wichita City Council.)
Reading this, can you tell me who will own the hotel building? I wondered, so I posed this question by email to the city’s public information officer: “The sentence fragment ‘which the structure will be owned by the WAA in accordance with existing policy’ sounds like the hotel building will be owned by the Wichita Airport Authority. Is this correct?”
I received a generic response that illuminated nothing. 2 My follow-up question was not acknowledged by the end of the day.
The council will, at least according to its schedule, consider this item tomorrow morning. Will city council members, acting as the Wichita Airport Authority, have a clear idea of the meaning of this agenda item and the supporting contract?
I think I know what it means. WEH will own the hotel and lease the land from the city. There’s language like this: “The development group requesting a lease agreement has formed a Kansas corporation to own and operate a hotel on the Airport.” (emphasis added)
Further, the lease is priced by the square foot of land (49.6 cents per square foot per year), although after four years that is replaced by a minimum agreed amount or a percent of the revenue of the hotel.
All this points to WEH owning the hotel building, not the city through the Airport Authority, although the Wichita Business Journal has a different opinion. 3 But it’s a shame that we must guess what the city means.
Will city council members also have to guess? Perhaps. This item is on the airport’s consent agenda. Unless a council member speaks up and asks for clarification, there will be no discussion on this item.
“All buildings and land are owned by the Airport Authority, with just a few exceptions. The FAA owns the control tower and the Post Office and the County owns the buildings at Jabara’s WSU Tech campus. But even in those cases, the land is owned by the Authority. Tenants pay land and building rent but do not pay property taxes.” ↩
