Kansas City architecture
Patrick Tuohey

No sooner had Show-Me Institute published “Some Positive Signs on Economic Development Incentives in Kansas City” than one of the points of optimism fell away. What does this mean for reform in Kansas City?

The Strata project—in which the taxpayers of Kansas City were asked to invest $63 million in public subsidies for a $132 million office tower with no known tenants—was flawed from the start. I previously  noted that some of the claims regarding the need for the project were false, and even the mayor said, “Strata should fail.”

The city council reworked the deal, reducing the public incentive to $36 million, indicating that the developers’ initial claims for the need for public investment were questionable all along. The mayor still opposed the new deal, but the subsidy was approved by the council on a 7–4 vote.

Activists opposing the deal demanded that the mayor veto the measure, which would have required 8 votes of the council to override. Despite voting against the measure, the mayor chose not to veto it. Why not? Why didn’t the mayor exercise his power to try to stop something he says he is against?

Research indicates that economic development incentives such as these do not change behavior in 75 percent of cases. Even those in charge of the city’s economic development policy concede the benefits are “extremely difficult to quantify.” If policymakers want to protect taxpayers from wasteful subsidies, they must start saying no.

 

About the Author

Patrick Tuohey
Patrick Tuohey
Senior Fellow of Municipal Policy

Patrick Tuohey works with taxpayers, media, and policymakers to foster understanding of the conse