How do you entice people to move out to the middle of nowhere in Kansas – besides the romance of a quiet life on the range?
That’s the simple idea that led lawmakers and Gov. Sam Brownback to approve rural opportunity zones that help students pay back college loan debt and give income tax breaks to folks who move to lonely Kansas counties from other states.
Since the program’s start in July 2011, 489 people have applied to get up to $15,000 of their student loans repaid by the state. The majority of applications came from Kansas students, about 20 percent of whom went to Kansas State University, according to the state Department of Commerce.
But 179 applications came from outside Kansas – 35 other states in all. State officials don’t know yet how many applications have been accepted, but they see the numbers as a promising start.
“That’s exactly the type of outcome we’d like to see,” said Dan Lara, a spokesman for the department. “If we get half of them to stay beyond five years, it’s a success.”
Kansas Secretary of Commerce Pat George, along with other top state officials, plans to travel the state Sept. 11 and 12 to talk about the program’s success as part of a small business empowerment tour that will highlight business recruitment efforts and tax cuts that start next year. The tour includes stops in Wichita and Hutchinson on Sept. 12.
The rural opportunity zone program, available in 50 counties, offers income tax rebates to people who move into those counties after not living in Kansas for at least five years. It also offers student loan repayments for students who move to a qualifying county.
It won’t be clear how many people have applied for the income tax rebate until next year, according to the Department of Revenue.
Kansas’ program got some national media play in business publications, generating a boost in interest, Lara said. He said the program at first seemed to draw the most interest from rural hospitals that were trying to attract health professionals.
Now, he said, the state is using it as a major incentive to oil companies getting involved in the boom in oil and natural gas fracking, particularly in southern Kansas where Kingman, Harper and Barber counties are among those participating in the opportunity zones.
With the state’s recent reduction of personal income tax rates and the elimination of nonwage income taxes for many businesses, such as limited liability companies, partnerships and farms, Kansas could be even more attractive for tax-weary workers, Lara said.
He said that means someone could move into Kansas, get some of their student loan repaid, pay no personal income taxes for five years and start a business that wouldn’t have to pay nonwage income taxes either.