City staff and developers are seeking a compromise to settle a dispute over what to tell customers about the price they would pay for a new kind of economic development district.
The Wichita City Council is set to vote today on a re-write of the policy for community improvement districts.
The districts, created in 2009 by the Kansas Legislature, allow businesses to charge customers an extra 2 percent in sales tax to pay for a development's construction, landscaping, bus stops and artwork. The tax can last up to 22 years, but goes away when the work is paid for.
Immediately popular with developers, the council has already approved districts for a hotel at WaterWalk and a retail development at Central and Oliver. The council approved districts for Bowllagio, a bowling and retail complex proposed for Kellogg and Maize Road, and a grocery store proposed in Planeview, but both projects were put on hold when they failed to gain approval for other subsidies.
But during a discussion this fall on tweaking the rules for the districts, four City Council members said that the customers paying the extra tax should be told about it up front. They suggested a sign in the store.
City staff, which has recommended that customers be notified by listing the stores on a website, said developers believe that if customers were reminded about the extra tax while shopping it would hurt the businesses.
Urban Development Director Allen Bell said that if the council insists on a sign or door sticker he offers two possibilities:
* A sign saying that the development is made possible by district financing, as is done in Springfield, Mo.
* A sign laying out the percentage of district tax collected, as in Lawrence.
The second version would be "viewed by the developers as a poison pill," Bell said.
Developers wouldn't get stores to lease space, and without leases the projects couldn't find financing, he said.
The first sign, letting people know about the district and pointing the curious to a website, is a good compromise.
"This is a way to a middle road," he said. "People will be able to find out more, without it being such that it puts the total kibosh on the project."
Developer Christian Ablah, who has two projects approved as improvement districts, said he would be happy with the first version of the sign.
"We'll do what the city wants," he said. "We're all on the same page."