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Thursday, June 26, 2014

Sedgwick County Commission votes 3-2 to not challenge Southfork TIF

By Deb Gruver
The Wichita Eagle

Sedgwick County commissioners voted 3-2 Wednesday to support a tax-increment financing district for developer Jay Maxwell’s Southfork project.

The city of Wichita already had approved the district, which will capture future taxes to be used to improve 72 acres near I-135 and 47th Street South that Maxwell plans to develop as a mix of retail and office space with hotels and restaurants.

A majority of commissioners — Karl Peterjohn, Richard Ranzau and Dave Unruh — voted against an earlier proposal for public funding for the project in January.

But Unruh said Wednesday that changes to Maxwell’s project, including elevating much of the land for the project out of a floodplain, had satisfied his concerns.

Maxwell’s first proposal requested $20.5 million in public funding — a mix of tax-increment financing and a community improvement district, which would have allowed for a special sales tax to be charged at Southfork.

The revised proposal asked for nearly $9.9 million in tax-increment financing but removed the request for a special sales tax, although that could be requested again later.

Because such financing affects county and school district tax collections, each entity had 30 days after the city’s approval to challenge it. Commissioners had one day left to make a decision.

Ranzau spoke passionately against public funding for the project, saying he didn’t think it was necessary. He said he had reservations about whether Maxwell really needed taxpayer money.

Maxwell told commissioners that he would not develop Southfork as proposed without the tax-increment financing district. He might develop something else there, he said, but it wouldn’t be as built out as Southfork.

“It is barely feasible, guys,” he told commissioners, identifying himself as someone who typically is an advocate for limited government.

“There are places for private-public partnerships,” Maxwell said.

Eight members of the public, including former commissioner Kelly Parks, spoke against the district, and four members of the public, including Goddard’s mayor, spoke in favor of it.

Dave Trabert, president of the Kansas Policy Institute, said the project sounded like a good boost to Wichita’s south side.

But he said the developer should be able to do the project himself, without taxpayer help.

He also said there are better ways for cities, counties and states to improve the business environment.

“Businesses value regulatory reform and tax reform more than incentives,” he said.

Wichita resident Shirley Koehn said the area near the proposed development doesn’t seem blighted to her. To qualify for tax-increment financing, an area must be blighted. State law says land in a floodplain is considered blighted.

Koehn rattled off a long list of nearby businesses and also noted that Maxwell plans to take most of the development out of the floodplain.

“What was once the dead duck now becomes a golden goose," she said.

Dale Carter, president of the South Wichita Business Association, said his group supported the district.

“We feel strongly that this is the right development coming to the right place at the right time,” Carter said.

And Connie Klassen, president of the South Area Neighborhood Association, noted that the “last really big improvement of living in south Wichita was the completion of the canal route in 1979. Since then, it always seems like Wichita has grown north, east and west.”

Wichita City Council member Jim Clendenin came to the commission meeting to speak in favor of the district, saying south Wichita often gets forgotten. He said the project would take undesirable land and bring in increased property and sales taxes.

Commission Chairman Tim Norton agreed.

“This is a great project,” he said.

Reach Deb Gruver at 316-268-6400 or dgruver@wichitaeagle.com.

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