The Wichita City Council approved an industrial revenue bond issue Tuesday to retain a high-tech company downtown.
The council unanimously approved a $2 million bond issue for High Touch Technologies, a Wichita computer technology firm that wants to buy its corporate headquarters at 110 S. Main. The discussion segued quickly into a debate over property values downtown.
The bond issue will allow the employee-owned, Wichita-founded company to acquire and stabilize the ownership in its 106,000-square-foot headquarters, company president Wayne Chambers said.
“This is an important day for our employee owners,” Chambers said.
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And it brings to an end the courtship of High Touch by out-of-state economic development officials that include Texas, city and company officials said.
The building needs extensive work, including elevator repairs and tenant improvements, Chambers and city officials said. The bonds, which will be purchased by High Touch, will finance the $1.15 million cost of the building, plus the repairs and improvements.
High Touch will add 50 jobs, company officials said, with an average salary of $65,000.
The company will have its property taxes frozen for at least five years at the current amount – $33,250 a year – and will receive a sales tax exemption on the construction materials involved in the building improvements.
That drew the ire of Bob Weeks, a blogger active in Americans for Prosperity.
Weeks, citing his own figures, said the High Touch property taxes equate to 31 cents a square foot, while residents of Wichita can pay up to $150 per square foot.
“Usually, we hear about a financing gap that must be bridged by the public treasury,” Weeks said. “The (High Touch) property taxes are too small. Some commercial landlords pay 10 times that much.”
Weeks said that property values are plummeting downtown, but city officials jumped on that claim, attributing the decline to the tax exemptions offered for equipment and machinery while real property values are on the rise.
“We keep hearing from speakers here that the property values in the downtown business district are declining,” council member Janet Miller said.
“While, in fact, that’s a true statement … it has been shown that’s because of state tax policy that’s been implemented and has nothing to do with the policies of the City Council or development efforts downtown.”
City Manager Robert Layton characterized the valuation losses downtown to machinery and equipment “significant.” But he said real property values have grown by 47 percent downtown in the past decade.