The future of the Bowllagio development at Kellogg and Maize remained as uncertain as ever Wednesday after Sedgwick County commissioners struck down a proposed tax-increment financing district for the project.
Commissioners unanimously voted that the TIF district would have an adverse effect on the county. The Wichita City Council approved the TIF district last month, but the county and the Goddard School District had the right to weigh in on the project.
Tax-increment financing is a development tool that captures property tax on the increase in assessed valuation and allows the money to be used for improvements. In this case, funding would have gone to drainage improvements.
Although commissioners said they understood there are flooding issues in the area, they said they couldn’t make the numbers work.
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Tim Austin, who represented developer Jay Maxwell at the meeting, said later Wednesday he wasn’t sure how the commission’s vote would affect the project.
“I talked with Jay, and he has partners in that deal. We will have to assess going forward,” Austin said.
He acknowledged, however, that the commission’s vote was disappointing to proponents of the project.
“There’s been a lot of time, energy and effort put into it,” Austin said.
City Council members had split in their vote on the district, coming down 4 to 3 in favor of it on Nov. 20.
“I’m just concerned about how these numbers add up in my mind,” Commissioner Dave Unruh said.
Commissioner Karl Peterjohn made a motion to find that the district would be a bad deal for the county, and Unruh gave it a second.
Unruh said it appeared to him that the first phase of the development could proceed without public tax dollars from a TIF district.
The city already has approved a community improvement district for the project, would allow special sales taxes to be collected.
The development would feature a family bowling center, retail, office space, restaurants and hotels.
Owners of existing bowling alleys told commissioners Wednesday that the TIF district would give competitors an unfair advantage. They said there already are about 220 bowling lanes in Wichita.
Frank DeSocio, who owns The Alley at 13th and Greenwich with his wife, Cathy, noted he didn’t ask for taxpayer help when he built the entertainment complex near Warren Theatre East.
“We welcome competition, just not government subsidized” competition,” DeSocio told commissioners.
He said allowing special financing for Bowllagio would hurt his family business.
Austin emphasized the public benefits of drainage improvements, but that wasn’t enough to convince commissioners.
“This project is all about flood control," Austin said.
Peterjohn said he was worried about hidden costs to the county.
The county’s policy on TIF districts is to support efforts to eliminate blight and promote redevelopment by allowing county tax revenues to be diverted as long as doing so creates no adverse impacts.
It has a five-step test. A proposed district is considered adverse if:
• Potential loss of tax revenue would hinder the county from delivering future public services effectively.
• The project is economically feasible without the county’s support.
• There’s not enough private funding to affect default risk.
• The cost is greater than the benefits.
• Timely information was not available for a review.