Economic development incentive to be canceled

The City of Wichita will consider canceling an economic development incentive for a firm that no longer meets policy requirements.

Two years ago the Wichita City Council granted an economic development incentive for a freestanding emergency department in northeast Wichita. The incentive was in the form of property tax relief. The firm would be exempt from paying 88 percent of its property taxes for five years, with the possibility of renewal for another five years. ¹

At the time, the city estimated the first-year property tax savings to be $61,882, allocated this way: City of Wichita: $17,226. State of Kansas: $792. Sedgwick County: $5,520. USD 259 (Wichita public school district): $28,345.

The facility closed earlier this year, and will be converted to a cardiology office. This change means the facility no longer meets the criteria in the city’s economic development policy in two ways. First, the city’s policy requires medical facilities to attract at least 30 percent of its patients from outside the Wichita MSA, and the city says the new use of the facility does not meet this requirement.

Second, the new use of the facility is not the use that was approved by the council two years ago.

The city’s office of economic development recommends canceling the tax incentive after this year. This item appears on the meeting’s consent agenda, which means there will be no discussion or individual vote on this matter unless a council member requests.

I hope that a council member asks that this item receive discussion and perhaps an individual vote. This is a positive moment for the city. Not that a business failed to survive — that is unfortunate — but that the city is applying policy as designed.

Freestanding emergency departments are controversial. The notes to this article hold references to news articles and academic studies looking at the costs and usage of these facilities. ^{2 3 4 5 6 7 8 9}

Researchers note that the emergency rooms are much more expensive than traditional doctor offices or urgent care facilities, yet many of the diagnoses made at the ERs are the same as made at non-emergency facilities.

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Notes