Tag Archives: Wichita city government

Wichita and other airports

How does the Wichita airport compare to others?

The nearby chart shows data starting in 2010 for Wichita and selected airports, as well as all U.S. airports. For all measures except load factor, Wichita is at or near the bottom. Often the trend for Wichita underperforms the other airports, too.

It is not too surprising that the Wichita airport lags others, as the Wichita economy has been underperforming, even losing jobs in 2017. Now we know that the metropolitan area and city proper have lost population.

Local business leaders have formed a campaign to promote using the airport. The statistics in this chart and the visualization end shortly before that campaign started.

This chart was created from a visualization holding data from TranStats, a service of the Bureau of Transportation Statistics (BTS), which is the independent statistical agency within the United States Department of Transportation (DOT). While monthly data is available, this visualization holds annual totals through 2018.

The visualization holds data for all U.S. airports with scheduled flights. To view and use the interactive visualization, click here.

Wichita and selected airports. Click for larger.

Airport traffic statistics, 2018

Airport traffic data presented in an interactive visualization, updated through 2018.

This visualization holds data from TranStats, a service of the Bureau of Transportation Statistics (BTS), which is the independent statistical agency within the United States Department of Transportation (DOT). While monthly data is available, this visualization holds annual totals.

The nearby example shows data starting in 2010 for the nation (blue lines) and Wichita. The visualization holds data for all U.S. airports with scheduled flights.

Example from the visualization, showing Wichita compared to all airports, through 2018. Click for larger

A few observations regarding Wichita airport traffic as compared to the nation:

  • Since 2014, passenger traffic (departing passengers) at the Wichita airport is higher, but traffic for the nation as a whole is much higher.
  • The number of scheduled departures has been declining in Wichita, while increasing for the nation after a decline.
  • The number of available seats on departing flights from Wichita has been mostly level, while rising sharply for the nation.
  • Load factor for Wichita has been rising, while level and declining slightly for the nation.

To view and use the interactive visualization, click here.

New metropolitan rankings regarding knowledge-based industries and entrepreneurship

New research provides insight into the Wichita metropolitan area economy and dynamism.

The Walton Family Foundation has released a study titled “The Most Dynamic Metropolitans,” saying it is new research ranking the economic performance of metropolitan areas in the Heartland and across the country. 1

Of the study, the authors write “Our Most Dynamic Metropolitan Index, and the analysis contained in this report provides objective insight into the communities providing economic opportunity for their residents, separating high performers from the low. Most Dynamic Metropolitans provides fact-based metrics on near-term and medium-term performance and prospects for long-term growth. The index allows economic development officials the ability to monitor their metro’s vivacity relative to others on a national basis or within their region and state.”

In the overall rankings, Wichita was number 319 of 379 metropolitan areas examined. Of note, this research recognizes the importance of young firms:

While most of our metrics are commonly used indicators of economic development, the young firm employment ratio is a relatively new measure. We use factor analysis to test our hypothesis that the ratio is an indicator of longer-term economic growth. Factor analysis is a statistical tool that can derive categories, called factors, from several variables by finding the ways clusters of variables move together. A factor analysis on all of our metrics tells us that we generally have the two factors we claimed to have above: one closely relating to variables such as 2016-2017 growth in average annual pay and 2017-2018 job growth. The second most closely relating to per-capita personal income, 2013-2017 growth in real GDP, 2013-2017 average annual pay growth and the young firm employment ratio. Thus, our hypothesis regarding the young firm employment ratio seems valid.

There have been some rankings showing Wichita doing well in jobs at young firms. 2 That’s good, as young firms — which are different from small business — are vitally important to economic growth. 3

This study, however, shows Wichita lagging in young firm employment ratio. In these rankings, Wichita came in at position 247 of 379 metro areas. That is better than the overall ranking for Wichita, which is at number 319.

The young firm employment ratio is calculated using data from 2016. Perhaps newer data will show something different.


Notes

  1. Walton Family Foundation. New Metropolitan Rankings Show Knowledge-Based Industries and Entrepreneurship Drive Success. June 10, 2019. Press release with links to documents available at https://www.waltonfamilyfoundation.org/about-us/newsroom/new-metropolitan-rankings-show-knowledge-based-industries-and-entrepreneurship-drive-success.
  2. Weeks, Bob. Metro Monitor evaluates the Wichita economy. Available at https://wichitaliberty.org/economics/metro-monitor-evaluates-wichita-economy-2018/.
  3. Jason Wiens and Chris Jackson. The Importance of Young Firms for Economic Growth. Available at https://www.kauffman.org/what-we-do/resources/entrepreneurship-policy-digest/the-importance-of-young-firms-for-economic-growth.

Wichita airport traffic

Traffic is rising at the Wichita airport. How does it compare to others?

Click for larger.
Passenger traffic at Wichita Dwight D. Eisenhower National Airport has been rising. We know that from news reports and social media. While rising activity is good, it’s important to place Wichita in context with other airports.

(The Wichita airport has reported data through April 2019, while comprehensive national data from the Bureau of Transportation Statistics is available through February, so these comparisons are through February.)

Media reporting on the Wichita airport often uses “passengers” as the measure. The industry, however, uses “enplanements” as the most important measure of airport traffic. When Bureau of Transportation Statistics uses the term passengers, the precise meaning of the data is enplanements. 1

Looking at passengers (that is, enplanements) for the Wichita airport, we see that monthly Wichita passenger counts are rising, generally. 2 But not for all months. Over the past year, there were three months when traffic fell, compared to the same month of the previous year.

Compared to the nation, there were seven months in the past year when the increase in passengers in Wichita was greater than the change for all airports, as shown in the bars for each month in the nearby chart. Because of several slow months in Wichita coupled with some the of good months in Wichita being only slightly better than the nation, the overall picture is not as good for Wichita. This can be seen by the lines in the same chart, where the change in passengers over the last year is always higher for the nation.

Besides the number of passengers, we should also consider the number of flights departing an airport. This is particularly important to business travelers, as for them, the availability of a flight today or tomorrow may be more important than a bargain-price fare. In this chart, there are some months where the number of flights fell from the year before. The 12-month trend for Wichita is falling while rising for the nation.

Is the reported rising passenger count at the Wichita airport good news? Of course it is. But a useful assessment requires placing the Wichita data in context. In that context, the Wichita airport is underperforming.

Click charts for larger versions.

In the following chart of passengers, Wichita counts are generally rising, but not as fast as the nation. This data is indexed with January 2011 representing 100. The thicker lines are the average of the prior 12 months in order the smooth the seasonality of the monthly data.

In the following chart of the number of flights, Wichita is on a downward trend generally, although in the last two years the value has increased slightly.


Notes

  1. The government requires carriers to report enplanements, so it is a consistent measure across all airports. Further, airports generate revenue primarily from enplaned passengers rather than arriving passengers. The number of enplanements is almost exactly half the number of passengers. Over the last 15 years, enplanements in Wichita have accounted for 49.88 percent of passengers, with deplanements being 50.12 percent.
  2. Passenger traffic data is highly seasonal. It is not uncommon for passenger counts in the summer months to be 25 or 30 percent higher than winter counts. Therefore, comparisons are to the same month in the previous year.

Naftzger Park, according to Wichita Mayor Jeff Longwell

He had an opportunity to learn the true history of Naftzger Park in downtown Wichita. But Mayor Jeff Longwell didn’t learn, or maybe he doesn’t care.

In March, Wichita Mayor Jeff Longwell answered a question about Naftzger Park, telling viewers of the KPTS Television program Call the Mayor that:

“Actually what we found out is when our city fathers put in that park years ago they put the park in on private development land and so the development’s actually not on Naftzger Park. Naftzger Park used to be planted on private development land and so they had to change the boundaries of the park.”

The mayor blamed past city administrations for not being to read a survey. (Click here to view the video starting with this question.)

Chase M. Billingham, who is assistant professor of sociology at Wichita State University, has researched the history of this part of downtown. 1 He submitted a piece to the Wichita Eagle shortly after that episode of Call the Mayor aired. He wrote:

This claim — that the public park was erroneously built on privately owned land — has been one of the most common arguments offered by city officials in favor of their strategy to bulldoze Naftzger Park and rebuild it on a new footprint. This argument has been voiced repeatedly by elected officials and city staff during City Council meetings and public hearings. As the developers of the Spaghetti Works property have begun to build a new mixed-use development there, the city has maintained that it must fix that previous error and restore the developers’ property rights by relinquishing Naftzger Park’s eastern edge.

The claim that Naftzger Park was built on private land is wrong, however, and it epitomizes the disregard for history and due diligence that has characterized much of the city’s disjointed effort to overhaul this key public downtown space.

Billingham then explained the documented history of land ownership in the area, with the upshot being this: “As a result, small areas on the eastern edge of the park did, indeed, sit on privately owned land. But it was not because the park was built on private land; instead, it was because Wichita sold parts of its own public park to private owners for far less than it had paid for the land just a few years earlier.” (emphasis added)

Concluding, he wrote:

When city officials argue that destroying and rebuilding Naftzger Park was necessary, in part, because their predecessors mistakenly built the public park on private land, they are not being truthful. Among other questions surrounding the demolition of that important public space, then, Wichitans deserve to know why their leaders were so eager to relinquish the public access to this land that they had been entitled to for decades.

Why is this incident from March relevant today, two months later? Because on the May 30, 2019 edition of the monthly show Call the Mayor, Longwell repeated the same falsehood.

I’m reluctant to call someone a liar, as a lie means “a false statement deliberately presented as being true” or “something meant to deceive.” But as Billingham wrote, Wichita city officials, including Longwell, are not telling the truth.

Mayor Longwell, along with other Wichita city officials, had an opportunity to learn the truth in both the online and print editions of the largest newspaper in Kansas. If they did not agree with Billingham’s research and conclusion, there are many ways to have a public dialog on the matter. For example, the city has a popular website and social media presences, with the city’s Facebook page being liked by 27,230 people. 2 The city has a communications staff, including a strategic communications director, marketing services director, assistant director of strategic communications, and communications and special events manager. 3 There is a city manager, assistant city manager, six city council members, and a fleet of bureaucrats.

Don’t any of these people care about the truth? Don’t they want to help the mayor of the city present accurate and truthful information?


Notes

  1. Billingham is also the author of a fascinating history of the area, but it was published in an academic journal that is not freely available online. See Billingham, C. M. (2017) “Waiting for Bobos: Displacement and Impeded Gentrification in a Midwestern City”, City & Community, 16(2), pp. 145–168. doi: 10.1111/cico.12235.
  2. Facebook, https://www.facebook.com/cityofwichita/, observed on May 31, 2019.
  3. City of Wichita. Meet the Communications Team. Available at https://www.wichita.gov/News/Pages/Team.aspx.

Wichita jobs and employment, April 2019

For the Wichita metropolitan area in April 2019, the labor force is up, the number of unemployed persons is down, the unemployment rate is down, and the number of people working is up when compared to the same month one year ago. Seasonal data shows small declines in labor force and jobs from March.

Data released today by the Bureau of Labor Statistics, part of the United States Department of Labor, shows an improving, but also mixed, employment situation for the Wichita Metropolitan Statistical Area.

Click charts and tables for larger versions.

Total nonfarm employment rose from 298,500 last April to 303,400 this April. That’s an increase of 4,900 jobs, or 1.64 percent. (This data is not seasonally adjusted, so month-to-month comparisons are not valid.) For the same period, jobs in the nation grew by 1.76 percent.

The unemployment rate in April 2019 was 3.3 percent, down from 3.5 percent one year ago.

Considering seasonally adjusted data from the household survey, the labor force fell by 227 persons (0.1 percent) in April 2019 from March 2019, the number of unemployed persons fell by 97 (0.8 percent), and the unemployment rate was unchanged at 3.7 percent. The number of employed persons not working on farms fell to 299,538 in April from 299,668 the prior month, a decline of 130 persons, or 0.0 percent.

The following chart of the monthly change in labor force and employment shows a general decline over the past year, with some recent months of losses for both measures.

The following chart of changes from the same month one year ago shows a general decline in the rate of growth.

Looking at the charts of changes in employment year-over-year, we see some months in the past year where Wichita outperformed the nation. That last happened in 2012.

This article has been updated to correct a mistake in the original version.

Wichita population, 2018

The City of Wichita lost 1,052 in population from 2017 to 2018, a decline of 0.27 percent.

Data released today by the United States Census Bureau shows the City of Wichita losing population from July 1, 2017, to July 1, 2018. 1

The bureau’s estimate of city population on July 1, 2018 is 389,255. This is a decline of 1,052 (0.27 percent) from the year before. These are populations of cities, not metropolitan areas, although the Wichita metropolitan area also lost population. 2

The estimate of population on July 1, 2017 was revised from 390,591 to 390,317, meaning that for 2017, Wichita population declined by 242 from the July 1, 2016 population of 390,509.

With the revised 2017 figure, Wichita has had two years of declining population, as can be seen in the nearby chart.

While Wichita lost 0.27 percent of its population in one year, the top 100 cities gained 0.51 percent. Since 2010, Wichita has grown by 1.71 percent, while the top 100 cities grew by 7.57 percent.

Wichita is the fifty-first largest city, down from fiftieth the two prior years.


Notes

  1. Annual Estimates of the Resident Population for Incorporated Places of 50,000 or More, Ranked by July 1, 2018 Population: April 1, 2010 to July 1, 2018 Source: U.S. Census Bureau, Population Division Release Date: May 2019
  2. Weeks, Bob. Wichita population falls; outmigration continues. Available at https://wichitaliberty.org/wichita-government/wichita-population-falls-outmigration-continues/.

Sedgwick County job growth continues strong pace

In the fourth quarter of 2018, Sedgwick County continued strong job growth.

Data released today by the Bureau of Labor Statistics, part of the United States Department of Labor, show a continuing strong jobs picture for Sedgwick County.

Data from the Bureau’s Quarterly Census of Employment and Wages (QCEW) program show that from December 2017 to December 2018, Sedgwick County gained 5,500 jobs, which is a rate of 2.2 percent, as calculated by BLS. For the nation, growth was 1.5 percent.

The job growth rate for Sedgwick County was 100th best among the nation’s 350 largest counties.

While the job growth rate in Sedgwick County for the fourth quarter of 2018 exceeded the national rate, for the most recent four quarters the average rate for Sedgwick County was 1.3 percent, and 1.6 percent for the nation.

Average weekly wages in Sedgwick County increased by 3.8 percent over the year to $946. For the nation, wages rose by 3.2 percent to $1,144.

Click charts for larger versions.

What could be done with WaterWalk

There is an opportunity for Wichita to break the logjam holding up development at WaterWalk.

Critics of city development projects point to WaterWalk as an example of a failed downtown development. Some $41 million of city funds were spent there with few positive results, With the closing of the Gander Mountain store, its fortunes were trending downwards until the King of Freight deal was announced. Although, it is debatable whether offices are a good use for this property, given its promotion as “Wichita’s Next Great Gathering Place,” a center of retail, entertainment, and residence. 1

The King of Freight deal might be a way to get something from a failed development, at least for now. But the city could do more.

The city has many excuses for the failure of WaterWalk. In a recent social media town hall concerning the new baseball stadium and surrounding development, the city’s attitude was clear: WaterWalk is different, the city says. In the social media town hall, the city stated, “Waterwalk wasn’t the deal we put together nor did it have the safeguards of this project. Waterwalk is not a city owned development.” 2

(While the city criticizes the WaterWalk deal for not having safeguards, the protections built in the baseball deal aren’t very strong. And while the city says “WaterWalk is not a city owned development,” neither is the ballpark land development deal. Remember, the city is selling the land.)

What is the meaning of “we?” True, most current city officials weren’t in office at the time of the WaterWalk deal. KFDI reported “Mayor Longwell said it was unfair to “armchair quarterback” the decision that led to the the Waterwalk, especially since everyone on the council, including the Mayor, were not there for the decisions that led to the Waterwalk.”

Accountability belongs to others is the attitude of Wichita Mayor Jeff Longwell and other city officials.

But there is a grain of truth in the city’s answer. The city granted development rights for the WaterWalk property to a private development group, and there are about 85 years left in the agreement. That group is now headed by Jack P. DeBoer. He is in control of the land and its use.

That’s troubling. Recently DeBoer confessed to being “confounded” by WaterWalk, telling the Wichita Eagle, “It’s a business I don’t know anything about.” 3

DeBoer has had many years to produce development at WaterWalk. He has the ability to earn profit. But having produced very little and being “confounded” by WaterWalk, I think the key to moving forward is for the city to remove DeBoer and his group from the picture.

DeBoer has a long-term development deal with the city. Now he is asking the city to reconfigure a lease in which he is the tenant. Presumably, the changes he wants are worth something to him.

That’s an opportunity for the city to get something in return. I don’t know what that “something” might be, but this is an opportunity for the city to get some type of modification that might lead to progress at WaterWalk.


Notes

  1. Wichita Mayor Carl Brewer, 2008 State of the City Address. Available at https://www.wichita.gov/Council/CityCouncilDocument/2008%20State%20of%20the%20City%20Address.pdf.
  2. City of Wichita social media town hall on Facebook, March 7, 2019. See https://wichitaliberty.org/wp-content/uploads/2019/03/City-of-Wichita-Facebook-Waterwalk-2019-03-07.png.
  3. Then, of course, there’s his WaterWalk development downtown, which seems to be confounding him a bit.

    “It’s a business I don’t know anything about,” DeBoer says.

    A Bass Pro Shop once was planned for the mixed-use development and a Gander Mountain opened instead and then closed last year.

    “I’ve had opportunities to do, you know, a restaurant or something, and I’ve said, ‘No.’ ”

    DeBoer says he’s willing to take more time to be sure he makes the right decisions.

    “It’s the key piece of land in all of Wichita,” he says. “I don’t want to spend my life screwing it up.” Rengers, Carrie. Jack DeBoer talks life after Value Place and WoodSpring Suites. Wichita Eagle, November 2, 2018. Available at https://www.kansas.com/news/business/biz-columns-blogs/carrie-rengers/article220992720.html.

King of Freight move a step sideways

A Wichita firm plans to move its offices to what was billed as the city’s premier entertainment district.

King of Freight, a Wichita freight brokerage firm, is planning to move its operations to the vacant Gander Mountain building in WaterWalk. This requires a modification to the lease of the land.

It’s important to recognize that King of Freight is not the tenant in the lease. The landlord is the City of Wichita. The tenant is WaterWalk LLC, a Kansas limited liability company, whose president is Jack P. DeBoer. The lease covers only the land, not the building. The city does not own the building. While the city rents the land to DeBoer, there is undoubtedly a deal between him and King of Freight. Details of that are unknown.

When WaterWalk was conceived, the goal was a destination of retail, entertainment, and residences, and some $41 million of tax money was spent. The original lease for the Gander Mountain ground reflected that. Now, that a non-retail firm will be using the ground, a change was needed.

The reason is that the original lease included a provision for “additional annual rent.” If the business — Gander Mountain — exceeded certain financial parameters, the city could collect additional rent. The additional rent clause was never triggered. Other WaterWalk deals with similar provisions have never paid additional rent, either. 1)

The new lease abolishes the additional rent provision, although it could be reinstated if employment goals are not met. Since the additional rent clause is toothless, so there is no real penalty.

The tenant will continue to pay the city $1 per year in rent. King of Freight will pay $15 per month to use city parking spaces. This is perhaps half the market rate for long-term parking arrangements.

Is the move of King of Freight a good deal for the city and its citizens? King of Freight anticipates adding jobs in the future, and the new lease with the city requires certain job goals to be met. But immediately, the effect is simply moving employees from one downtown office to another. When King of Freight occupies new space, empty space will be left behind.

While putting the Gander Mountain building to use is good, its use as office space moves away from the original concept for WaterWalk, once touted as “Wichita’s Next Great Gathering Place.” 2

Will retail and entertainment establishments wish to locate near an office building? They didn’t want to locate in WaterWalk anyway, so maybe there is no change.

Of interest is DeBoer’s confession of being “confounded” by WaterWalk, recently telling the Wichita Eagle, “It’s a business I don’t know anything about.” 3

Before that, he told the Eagle that whatever becomes of the Gander Mountain building, it will be “something fun and good for the city.” 4

I don’t think that goal has been realized.

Of note: DeBoer told the Eagle he’s had opportunities to “do a restaurant or something,” but he declined. Former Wichita Mayor Carl Brewer, in State of the City addresses, promised specific named restaurants would be opening in WaterWalk. 5

In more detail

Excerpts from the city’s agenda packet for this item:

“The lease’s current rent requirement, which was drafted for a retail use, would be suspended if the job requirement is met, and would terminate in 10 years if KOF and its entities maintains the presence of 400 net new jobs in Wichita through the 10-year period.”

“KOF has also agreed to pay for parking spaces at an initial rate of $15/month per space. Revenue from KOF’s employee parking is estimated at approximately $70,000/year.”

From the lease agreement: “Section 5.01. Minimum Rent. As of the date first written above, Tenant has paid Landlord a minimum fixed annual rent (“Minimum Rent”) of One Dollar ($1) in one (1) installment covering the Term of this Lease as defined in Article I above.”

“Section 5.02. Additional Rent. The Tenant will also pay, without notice, and without abatement, deduction, or setoff, except as otherwise specifically allowed herein, as additional rent, all sums, taxes, assessments, costs, expenses, and other payments which the Tenant in any of the provisions of this Lease assumes or agrees to pay, and, in the event of any nonpayment thereof, the Landlord shall have (in addition to all other rights and remedies) all the rights and remedies provided herein or by law in the case of nonpayment of rent.”

This section then describes the mechanism of calculating “Additional Annual Rent.” This mechanism was crafted for a retail store so that if “Adjusted Net Cash Flow” was ever positive, the city would be paid 25 percent of that. But the activity of the retail store, Gander Mountain, never triggered the payment of additional rent. 6

The section goes on to modify the additional rent provision for uses other than retail, like an office: “No Additional Retail Rent and no Additional Rent involving any payment of any portion of the Adjusted Net Cash Flow shall be owed for any use of the Premises that is not a Retail Use under codes 4400 through 454390 of the 2017 NAICS.”

The property will be paying property taxes: “Section 6.01. Taxes. Tenant shall pay as additional rent during the Term and any extensions thereof, all ad valorem taxes, and all other governmental taxes or charges that may be levied against the Premises.”

Since the property is within a tax increment financing (TIF) district, the taxes flow to that, not to fund the general operations of government.

“Section 9.03. Parking. The parties agree that Tenant’s employees will have nonexclusive access to the 430-space Parking Garage and the 60 spaces of surface parking under U.S. 400 (“Kellogg”) for an initial rate of $15/month per employee for parking between the hours of 8:00 a.m. – 6:00 p.m., Mondays-Fridays. Tenant shall be responsible for providing a monthly report of the number of employees who are parking in Parking Garage and on surface parking lot under Kellogg, and shall remit $15.00 per employee on a monthly basis. At each one-year anniversary of this agreement, the parking rate shall increase 3%.”

“Section 16.06. Assignment; Sublease. Tenant may freely assign or sublease all or any portion of the Premises without Landlord’s consent.”


Notes

  1. Weeks, Bob. Wichita WaterWalk contract not followed, again. Available at https://wichitaliberty.org/wichita-government/wichita-waterwalk-contract-not-followed/.
  2. Wichita Mayor Carl Brewer, 2008 State of the City Address. Available at https://www.wichita.gov/Council/CityCouncilDocument/2008%20State%20of%20the%20City%20Address.pdf.
  3. Then, of course, there’s his WaterWalk development downtown, which seems to be confounding him a bit.

    “It’s a business I don’t know anything about,” DeBoer says.

    A Bass Pro Shop once was planned for the mixed-use development and a Gander Mountain opened instead and then closed last year.

    “I’ve had opportunities to do, you know, a restaurant or something, and I’ve said, ‘No.’ ”

    DeBoer says he’s willing to take more time to be sure he makes the right decisions.

    “It’s the key piece of land in all of Wichita,” he says. “I don’t want to spend my life screwing it up.” Rengers, Carrie. Jack DeBoer talks life after Value Place and WoodSpring Suites. Wichita Eagle, November 2, 2018. Available at https://www.kansas.com/news/business/biz-columns-blogs/carrie-rengers/article220992720.html.

  4. “It’s a great building,” DeBoer says.

    “It’s just scratch your head, now what the hell’s going to happen?” he says. “We will come up with a plan.”

    The “we” includes George Laham of Laham Development and J.P. Weigand & Sons.

    “George and his team are the best,” DeBoer says.

    “Everything’s on the table.”

    That includes potential office, retail or entertainment uses – and a possible redesign for the building to make better use of the river behind it.

    “We just have to be sure of the direction,” DeBoer says. “We’re going to be very careful and think it through.”

    Whatever it is, he says that it will be “something fun and good for the city.”

    “We don’t have to depend on a guy who’s not as interested as we are.” 3. Rengers, Carrie. WaterWalk owner to make new plans for Gander Mountain building. Wichita Eagle, September 11, 2017. Available at https://www.kansas.com/news/business/biz-columns-blogs/carrie-rengers/article172482736.html.

  5. In his 2008 address, Brewer promised specific development at the struggling Waterfront development, which is heavily subsidized. Beaming with pride, Brewer said to the audience: “And, great strides are being made at Wichita Waterwalk. The topping out ceremony for Waterwalk Place is scheduled for this Thursday and I invite everyone to this event. I am pleased to announce two more national tenants that will be a part of the WaterWalk restaurant and entertainment development. … I am pleased to announce two more national tenants that will be a part of the WaterWalk restaurant and entertainment development. Joining Saddle Ranch Chop House will be Funny Bone Comedy Club and Wet Willies restaurant and daiquiri bar. These are just a couple of the fun and exciting tenants that will help make WaterWalk — Wichita’s Next Great Gathering Place.” This address was delivered a year before DoBoer took full control over WaterWalk, although he was involved before that.
  6. Email with Wichita City Manager Layton, May 10, 2019.

Wichita personal income growing, but slowly

Among the nation’s 383 metropolitan areas, Wichita ranked 347th for personal income growth.

Statistics released today by the Bureau of Economic Analysis, an agency of the United States Department of Commerce, show personal income in the Wichita metro area growing at a slow rate.

The figures released today are through calendar year 2017. For that year, personal income in the Wichita metropolitan statistical area was $30,801 million, up 2.3 percent from $30,103 million the previous year. These are current dollars.

Using inflation-adjusted dollars, income growth was 0.7 percent.

Of 383 metropolitan areas, Wichita ranked 347 for growth from 2016 to 2017.

Per capita personal income in the Wichita MSA for 2017 was $47,708 in current dollars, up 2.2 percent from $46,696 in 2016. In inflation-adjusted dollars, per capita personal income grew by 0.5 percent from 2016 to 2017. This growth rate ranked at position 327 among 383 metropolitan areas.

BEA offers these definitions:

Personal income is the income received by, or on behalf of, all persons from all sources: from participation as laborers in production, from owning a home or business, from the ownership of financial assets, and from government and business in the form of transfers. It includes income from domestic sources as well as the rest of world. It does not include realized or unrealized capital gains or losses.

Personal income is measured before the deduction of personal income taxes and other personal taxes and is reported in current dollars (no adjustment is made for price changes). Comparisons for different regions and time periods reflect changes in both the price and quantity components of regional personal income.

The estimate of personal income for the United States is the sum of the state estimates and the estimate for the District of Columbia; it differs slightly from the estimate of personal income in the national income and product accounts (NIPAs) because of differences in coverage, in the methodologies used to prepare the estimates, and in the timing of the availability of source data.

Per capita personal income is calculated as the total personal income of the residents of a given area divided by the population of the area. In computing per capita personal income, BEA uses Census Bureau mid-year population estimates.

More Wichita planning on tap

We should be wary of government planning in general. But when those who have been managing and planning the foundering Wichita-area economy want to step up their management of resources, we risk compounding our problems.

As announced by the City of Wichita, “In response to recent recommendations from Project Wichita and the Century II Citizens Advisory Committee, community organizations and their leadership are stepping forward to take the next step to create a comprehensive master plan and vision that connects projects and both banks of the Arkansas River.”

The city says these organizations will be involved:

We should note that these organizations have been responsible for developing the Wichita-area economy for many years. Despite recent developments like Cargill and Spirit Aerosystems, the Wichita economy has performed below the nation. While improving, our economic growth is perhaps half the national rate, and just two years ago Wichita lost jobs and population, and economic output fell.

Thus, the question is this: Why these organizations?

Then, recent behavior by the city, specifically surrounding the new ballpark, has resulted in a loss of credibility. Few seem happy with the city’s conduct. To this day, we still do not know the identities of the partners except for one.

In the future, can we trust the city and its partners are telling us the truth, and the whole truth?

Then, there are the problems with government planning. Randal O’Toole is an expert on the problems with government planning. His book The Best-Laid Plans: How Government Planning Harms Your Quality of Life, Your Pocketbook, and Your Future

Planning seems like a good thing. But O’Toole tells us the problem with government plans: “Everybody plans. But private plans are flexible, and we happily change them when new information arises. In contrast, special interest groups ensure that the government plans benefiting them do not change — no matter how costly.”

He continues: “Like any other organization, government agencies need to plan their budgets and short-term projects. But they fail when they write comprehensive plans (which try to account for all side effects), long-range plans (two to 50 years or more), or plans that attempt to control other people’s land and resources. Many plans try to do all three.”

Other problems with government planning as identified by O’Toole (and many others):

  • Planners have no better insight into the future than anyone else
  • Planners will not pay the costs they impose on other people
  • Unlike planners, markets can cope with complexity

Some will argue that the organizations listed above are not government entities and shouldn’t exhibit the problems inherent with government planning. But their plans will undoubtedly need to be approved by, and enforced by, government.

Further, some of these organizations are funded substantially or nearly entirely by government, are in favor of more government (such as higher taxation and regulation), and campaign vigorously for candidates who support more taxes and planning.

Following, from Randal O’Toole as published in 2007.

Government Plans Don’t Work

By Randal O’Toole

Unlike planners, markets can cope with complexity and change.

After more than 30 years of reviewing government plans, including forest plans, park plans, watershed plans, wildlife plans, energy plans, urban plans, and transportation plans, I’ve concluded that government planning almost always does more harm than good.

Most government plans are so full of fabrications and unsupportable assumptions that they aren’t worth the paper they are printed on, much less the millions of dollars taxpayers spend to have them written. Federal, state, and local governments should repeal planning laws and shut down planning offices.

Everybody plans. But private plans are flexible, and we happily change them when new information arises. In contrast, special interest groups ensure that the government plans benefiting them do not change — no matter how costly.

Like any other organization, government agencies need to plan their budgets and short-term projects. But they fail when they write comprehensive plans (which try to account for all side effects), long-range plans (two to 50 years or more), or plans that attempt to control other people’s land and resources. Many plans try to do all three.

Comprehensive plans fail because forests, watersheds, and cities are simply too complicated for anyone to understand. Chaos science reveals that very tiny differences in initial conditions can lead to huge differences in outcomes — that’s why megaprojects such as Boston’s Big Dig go so far over budget.

Long-range plans fail because planners have no better insight into the future than anyone else, so their plans will be as wrong as their predictions are.

Planning of other people’s land and resources fails because planners will not pay the costs they impose on other people, so they have no incentive to find the best answers.

Most of the nation’s 32,000 professional planners graduated from schools that are closely affiliated with colleges of architecture, giving them an undue faith in design. This means many plans put enormous efforts into trying to control urban design while they neglect other tools that could solve social problems at a much lower cost.

For example, planners propose to reduce automotive air pollution by increasing population densities to reduce driving. Yet the nation’s densest urban area, Los Angeles, which is seven times as dense as the least dense areas, has only 8 percent less commuting by auto. In contrast, technological improvements over the past 40 years, which planners often ignore, have reduced the pollution caused by some cars by 99 percent.

Some of the worst plans today are so-called growth-management plans prepared by states and metropolitan areas. They try to control who gets to develop their land and exactly what those developments should look like, including their population densities and mixtures of residential, retail, commercial, and other uses. “The most effective plans are drawn with such precision that only the architectural detail is left to future designers,” says a popular planning book.

About a dozen states require or encourage urban areas to write such plans. Those states have some of the nation’s least affordable housing, while most states and regions that haven’t written such plans mostly have very affordable housing. The reason is simple: planning limits the supply of new housing, which drives up the price of all housing and leads to housing bubbles.

In states with growth-management laws, median housing prices in 2006 were typically 4 to 8 times median family incomes. In most states without such laws, median home prices are only 2 to 3 times median family incomes.

Few people realize that the recent housing bubble, which affected mainly regions with growth-management planning, was caused by planners trying to socially engineer cities. Yet it has done little to protect open space, reduce driving, or do any of the other things promised.

Politicians use government planning to allocate scarce resources on a large scale. Instead, they should make sure that markets — based on prices, incentives, and property rights — work.

Private ownership of wildlife could save endangered species such as the black-footed ferret, North America’s most-endangered mammal. Variably priced toll roads have helped reduce congestion. Pollution markets do far more to clean the air than exhortations to drive less. Giving people freedom to use their property, and ensuring only that their use does not harm others, will keep housing affordable.

Unlike planners, markets can cope with complexity. Futures markets cushion the results of unexpected changes. Markets do not preclude government ownership, but the best-managed government programs are funded out of user fees that effectively make government managers act like private owners. Rather than passing the buck by turning sticky problems over to government planners, policymakers should make sure markets give people what they want.

State of the City, Wichita: Employment strength

Wichita Mayor Jeff Longwell’s State of the City video relies on flimsy evidence and plucks scant good news from a sea of bad. This is a problem.

Recently Wichita Mayor Jeff Longwell delivered the State of the City video. It was posted to YouTube on March 28, 2019, and may be viewed here.

In this video, the mayor said, “The recent Livability.com study measured employment rates strength over time, affordability, and community amenities.” This isn’t the first time the mayor and other city officials have mentioned this study, if we can even call it that. 1 In January, a tweet from the official @CityofWichita Twitter account contained: “We have been named one of the top two recession-proof cities in the nation by @Livability. Wichita was praised for its ability to withstand turbulence in the national economy, steady job growth and the state’s low income-to-debt ratio.” 2

What does the data tell us? The nearby chart illustrates that since the end of the last recession, job growth in Wichita has been below job growth in the nation as a whole. Generally, job growth in Wichita has been at about half the rate of the nation. In 2017, Wichita lost jobs. Yet, City of Wichita officials, including Mayor Longwell, tout “steady job growth,” relying on a study that obviously isn’t based on evidence.

Click for larger.

The mayor also said: “Wichita’s unemployment rate is at a historically low 3.5%, and WSU forecasts that Wichita is expected to see an across-the-board increase in overall jobs this year.”

Look at the data. In this table, we see that the unemployment rate (monthly average) for 2018 is nearly unchanged from 1999. Also nearly unchanged for these 19 years are the civilian labor force and number of jobs. Both values are slightly lower now. This is not “steady job growth,” as Wichita officials proclaim. It is stagnation.

It’s not only employment that has been bad news. In 2017 the Wichita economy contracted, which is the definition of a recession. 3 Personal income has grown only slowly. 4

Regarding jobs, the mayor accurately reports what the Center for Economic Development and Business Research at Wichita State University forecast said: Jobs are forecast to rise in Wichita for 2019. 5 Specifically, the report said: “Wichita is estimated to add approximately 2,500 jobs in 2018, and growth is projected to increase modestly to 0.9 percent in 2019, with more than 2,700 new jobs added.”

Is 0.9 percent job growth good? Nationally, the economy is expected to continue strong growth, although perhaps slightly slower than in 2018. 6 Nationally, job growth is forecast at 1.7 percent for 2019. 7 Wichita’s forecast rate of 0.9 percent is 53 percent of the national rate.

It’s good news that jobs are set to grow rather than shrink. But in a surging national economy, that’s setting a low standard for success.

What’s unfortunate is the mayor and city promote things like this as good news. But when we use readily accessible data from sources like the Bureau of Labor Statistics (part of the United States Department of Labor) and Bureau of Economic Analysis (a division of the United States Department of Commerce), we easily see that we’re not being told the entire story. “Recession-proof” glosses over recent years of declining production. “Historically low” unemployment rates ignore a stagnant and declining labor force. “An across-the-board increase in overall jobs this year” doesn’t contextualize that the forecast rate of growth for Wichita is anemic compared to the nation.

What we need to know is this: Are the mayor and city officials aware of the actual statistics, or are they ignorant?


Notes

  1. Weeks, Bob. Wichita, a recession-proof city. Available at https://wichitaliberty.org/wichita-government/wichita-recession-proof-city/.
  2. Twitter, January 22, 2019. https://twitter.com/CityofWichita/status/1087832893274157059.
  3. “For 2017, the Wichita metropolitan area GDP, in real dollars, fell by 1.4 percent. Revised statistics for 2016 indicate growth of 3.8 percent for that year. Last year BEA reported growth of -1.4 percent.” Weeks, Bob. Wichita economy shrinks, and a revision. Available at https://wichitaliberty.org/economics/wichita-economy-shrinks-and-revision/.
  4. “For all metropolitan areas in the United States, personal income rose by 4.5 percent. For the Wichita metro area, the increase was 2.3 percent. Of 383 metropolitan areas, Wichita’s growth rate was at position 342.” Weeks, Bob. *Personal income in Wichita rises, but slowly. Available at https://wichitaliberty.org/economics/personal-income-in-wichita-rises-but-slowly/.
  5. Center for Economic Development and Business Research at Wichita State University. Wichita Employment Forecast. January 8, 2019. Available at http://www.cedbr.org/forecast-blog/forecasts-wichita/1558-economic-outlook-wichita-2019-january-revision.
  6. Minutes of the Federal Open Market Committee. December 18-19, 2018. Available at https://www.federalreserve.gov/monetarypolicy/fomcminutes20181219.htm.
  7. Yandle, Bruce. Block out the noise: Here’s the 2019 economic outlook. Available at https://www.washingtonexaminer.com/opinion/block-out-the-noise-heres-the-2019-economic-outlook.

Wichita jobs and employment, March 2019

For the Wichita metropolitan area in March 2019, jobs are up, the labor force is up, and the unemployment rate is unchanged when compared to the same month one year ago. Seasonal data shows a small decline in jobs from February.

Data released today by the Bureau of Labor Statistics, part of the United States Department of Labor, shows an improving, but also mixed, employment situation for the Wichita Metropolitan Statistical Area.

Click charts and tables for larger versions.

Total nonfarm employment rose from 296,000 last March to 300,700 this March. That’s an increase of 4,700 jobs, or 1.6 percent. (This data is not seasonally adjusted, so month-to-month comparisons are not valid.) For the same period, jobs in the nation grew by 1.7 percent.

The unemployment rate in March 2019 was 3.9 percent, the same as one year ago.

Considering seasonally adjusted data from the household survey, the labor force rose by persons (0.0 percent) in March 2019 from February 2019, the number of unemployed persons rose by 149 (1.3 percent), and the unemployment rate rose from 3.7 percent to 3.8 percent. The number of employed persons not working on farms fell to 299,597 in March from 299,738 the prior month, a decline of 141 persons, or 0.0 percent.

The following chart of the monthly change in labor force and employment shows a general decline over the past year, with some recent months of losses for both measures.

The following chart of changes from the same month one year ago shows recent declines in the rate of growth.

Looking at the charts of changes in employment year-over-year, we see some months in the past year where Wichita outperformed the nation. That last happened in 2012.

State of the City, Wichita: The bright future

Wichita Mayor Jeff Longwell’s State of the City video doesn’t seem to be based on reality.

Recently Wichita Mayor Jeff Longwell delivered the State of the City video. It was posted to YouTube on March 28, 2019, and may be viewed here.

Not long into the address, the mayor says, “… we must embrace the challenges we face and forge ahead into the bright future that is just around the corner.”

Wichita MSA population, percent change from prior year. Click for larger.
On that bright future: Since the mayor spoke, learned that the Wichita metropolitan area lost population during the year ending July 1, 2018. 1 So at the time of the address, Longwell didn’t know the area had lost population, but he should have known that the trend of population growth has been slowing, as can be seen in the nearby chart.

What about the population of Wichita city proper, as that is the jurisdiction the mayor was elected to represent? (It’s better to look at the MSA, for a number of reasons. 2 For one, several major “Wichita” employers are not located within the Wichita city limits. Major portions of Spirit Aerosystems, for example, lie outside the city, and the city certainly takes credit for job creation there.)

Wichita and top 100 city population, annual change. Click for larger.
City populations are available through July 1, 2017. 3 From 2011 to 2017, the top 100 cities averaged annual growth of 1.03 percent. For the City of Wichita, the average was 0.29 percent, barely more than one-fourth the rate. (Wichita was the 50th largest city in 2017.) The trendline of growth for Wichita is down, as it is for the top 100 cities in general.

We have to ask: With a population growing much slower than the nation — and declining in the most recent year — what is the future of Wichita?

More importantly: Is Mayor Longwell aware of these statistics, and if so, why does he not recognize them? I hope this isn’t what he means by “embrace the challenges.”


Notes

  1. Weeks, Bob. Wichita population falls; outmigration continues. Available at https://wichitaliberty.org/wichita-government/wichita-population-falls-outmigration-continues/.
  2. Weeks, Bob. Wichita metropolitan area population in context. Available at https://wichitaliberty.org/wichita-government/wichita-metropolitan-area-population-in-context/.
  3. Annual Estimates of the Resident Population for Incorporated Places of 50,000 or More, Ranked by July 1, 2017 Population: April 1, 2010 to July 1, 2017 U.S. Census Bureau, Population Division. Release Date: May 2018

Wichita aerospace manufacturing concentration

Wichita leaders want to diversify the area economy. Has there been progress?

One way to measure concentration of an industry in a location is by the proportion of employment in that industry. The Bureau of Labor Statistics provides employment by industry for metropolitan areas. I’ve gathered the data for the Wichita MSA for two industries: Aerospace Product and Parts Manufacturing (NAICS code 3364) and all manufacturing. I’ve gathered this data for the Wichita Metropolitan Statistical Area and compare it to total private sector employment. This data is not adjusted for seasonality, as some is available only in that manner.

Click for larger.
Click for larger.

As the charts illustrate, there was a large shift in the two industry’s share of employment around the time of the Great Recession. Since then, the ratios have been more stable, with a slow decline until a small reversal of that trend over the last year.

The chart of employment ratio changes from the same month one year ago confirms: Manufacturing and aerospace employment has grown faster than total private employment in the recent year or so.

Click for larger.

Another way to measure concentration of an industry is through location quotients. The Bureau of Labor Statistics provides these, most notably for counties as part of the Quarterly of Census and Wages. 1 As described by BLS, “Location quotients are useful for studying the composition of jobs in an area relative to the average, or for finding areas that have high concentrations of jobs in certain occupations. As measured here, a location quotient shows the occupation’s share of an area’s employment relative to the national average.” 2

Further: “For example, a location quotient of 2.0 indicates that an occupation accounts for twice the share of employment in the area than it does nationally, and a location quotient of 0.5 indicates the area’s share of employment in the occupation is half the national share.”

This data is available by industry. I’ve gathered data for Aerospace Product and Parts Manufacturing (NAICS code 3364) for Sedgwick County and present it in a nearby chart.

First, note that the location quotient is large, 30 or more. This means the concentration of workers in this industry in Sedgwick county is over 30 times the concentration nationwide.

Second, the location quotient fell from 2007 through 2014. Since then, it has been steady.

Has the Wichita area diversified its economy? Based on these two measures, the answer is yes. That increased in diversity happened at the same time as a large decline in aviation-related employment, that decline being larger than the decline in all Wichita-area private-sector employment. That was not planned or desired. It was a result of worldwide trends. But since then, concentration in aviation-related employment has changed little, and shows signs of increasing concentration.

From General Aviation Manufacturers Association.


Notes

  1. Bureau of Labor Statistics. Quarterly Census of Employment and Wages. Available at https://www.bls.gov/cew/datatoc.htm.
  2. Bureau of Labor Statistics. Using Location Quotients to Analyze Occupational Data. Available at https://www.bls.gov/oes/highlight_location_quotients.htm.

Wichita population falls; outmigration continues

The population of the Wichita MSA fell from 2017 to 2018, and net domestic migration continues at a high level.

New data from the United States Census Bureau shows the Wichita Metropolitan Statistical Area losing population from July 1, 2017, to July 1, 2018.

The population estimate for 2017 was 645,628, and for 2018, 644,888. This is a decline of 740 persons, or -0.11 percent. Population changes in the seven years before 2018 averaged 0.30 percent each year.

The Wichita MSA ranked 89th largest among 383 metro areas, falling from rank 82 as recently as 2011.

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 metro areas. It is less than the loss of 3,235 persons the year before.

Click charts for larger versions.

Wichita MSA population and change from prior year.
Wichita MSA population, percent change from prior year.
Rank of Wichita MSA population.
Rank of Wichita MSA population one-year change.
Wichita MSA net domestic migration.

Wichita jobs and employment, February 2019

For the Wichita metropolitan area in February 2019, jobs are up, the labor force is up, and the unemployment rate is down when compared to the same month one year ago. Seasonal data shows a return to job growth.

Data released today by the Bureau of Labor Statistics, part of the United States Department of Labor, shows an improving employment situation for the Wichita Metropolitan Statistical Area.

Total nonfarm employment rose from 295,400 last February to 300,700 this February. That’s an increase of 5,300 jobs, or 1.8 percent. (This data is not seasonally adjusted, so month-to-month comparisons are not valid.) For the same period, jobs in the nation grew by 1.7 percent.

The unemployment rate in February 2019 was 3.9 percent, down from 4.2 percent from one year ago.

Considering seasonally adjusted data from the household survey, the labor force rose by 1,115 persons (0.4 percent) in February 2019 from January 2019, the number of unemployed persons fell by 64 (-0.5 percent), and the unemployment rate fell from 3.9 percent to 3.8 percent. The number of employed persons not working on farms rose to 300,080 in February from 298,01 the prior month, an increase of 1,179 persons, or 0.4 percent.

Looking at the charts of changes in employment year-over-year, we see some months in the past year where Wichita outperformed the nation. That last happened in 2012.

Click charts for larger versions.

Pay no attention to the Ferris wheel on the riverbank

When the City of Wichita shows architectural renderings, are we to treat them as promises, or as someone’s unrealizable dream?

Click for larger.
A rendering of the new Wichita baseball stadium and environs shows — prominently — a large Ferris wheel. Is this something Wichitans and visitors can look forward to?

No, as Wichita City Council Member Cindy Claycomb (district 6, north central Wichita) found out when she asked, there will be no Ferris wheel on the banks of the Arkansas River in downtown Wichita.

Or maybe not. On Facebook, Council Member Bryan Frye (district 5, west and northwest Wichita) wrote, “Doesn’t mean that a Ferris Wheel can’t happen somewhere else in the footprint.”

Of course, there could also be a roller coaster and a petting zoo with unicorns.

So what is the value of architectural renderings like this? Does the existence of a Ferris wheel constitute a promise to deliver?

It’s not like the city showed a Ferris wheel that’s 100 feet tall but delivered one just 75 feet tall. Maybe we could excuse that.

But there will be no Ferris wheel.

I don’t know who created the illustration with the Ferris wheel, but someone in authority at Wichita city hall included it in a presentation to the city council and people of Wichita.

Things like this are meant to generate excitement and enthusiasm. But this is done by making false promises.

Since we know there is no Ferris wheel, what else in the illustration is just sizzle without substance?

And when the city shows renderings of the next project (performing arts center, convention center, etc.), will we have to figure out what is real, and what is only vaportecture?

In Wichita, we don’t know who we’re dealing with

Wichita takes a big risk entering in a public-private partnership without knowing its partners.

When entering a public-private partnership, the City of Wichita tells us it vets its partners thoroughly. But this can’t be the case for the partners in the new Wichita baseball stadium and surrounding land.

That’s because we don’t know the identities of all the partners. All we know is that one Lou Schwechheimer is a majority owner. When asked what proportion of the team he owns, the city replied, “Over 50%.” Either the city does not know the number, or is not willing to tell us. 1 There’s a big difference between owning 51 percent of something and, say, 95 percent.

We are supposed to learn these names at some time. The development agreement passed by the city council on March 19, 2019 holds this:

Section 2.03 Conditions to the Effectiveness of this Agreement. Contemporaneously with the execution of this Agreement, and as a precondition to the effectiveness of this Agreement, to the extent they have not already done so, the Developer will submit the following documents to the City:

(c) the identity of the manager of the general partner of the Developer;
(d) a list of the Principals of the Developer

I’ve asked the city when the agreement might be executed and become effective.

Once the city receives the names, will it release them to the public? If we’ve learned anything lately, we know the city withholds information from the public. Even when it does not need to.

Will the list of principals reveal the share of ownership of each of the principals?

Is the list of principals that own the team the same as the owners of the surrounding land the city is selling?

What if we don’t like principals? What if they have unsavory reputations or a poor business and credit history? What do we do then?


Notes