Friday, October 30, 2009

Want some fixer-upper $? Sorry, wrong zip code

Posted By on Fri, Oct 30, 2009 at 9:30 AM

click to enlarge Crosby Kemper III
  • Crosby Kemper III

Kansas City, Missouri's tax-increment financing (TIF) program gets criticized for enriching developers. TIF's defenders point to projects like the "Glover plan," which, in addition to delivering a Costco and a Home Depot, provided money for midtown homeowners to fix up their property.

Housing programs have become a popular add-on to various TIF plans. The TIF plan featured in this week's Martin column has made grants to residents in the Southmoreland neighborhood.

Eighty-nine homeowners in Southmoreland have taken part in the program. An additional $585,000 will become available. "I'm a big proponent of these housing programs," says Kate Corwin, a Southmoreland resident who serves on a committee that advises the TIF plan. "I think they're great."

To be sure, it's nice to see regular folks benefiting a program that developers and attorneys have used to trim their business cards in gold leaf. The community benefits, as well, because the money helps homeowners keep their exteriors looking nice.

But are TIF housing programs really fair?

The inequity stems from the fact that TIF housing programs award public money to some residents but not others.

Sure, the 43rd and Main TIF plan has been good for Southmorelanders. But Kansas City residents who live who in other neighborhoods are ineligible to participate simply because their home does not abut an area in which a Fortune 1000 company wanted to expand. Gone Mild blogger Dan Ryan has called the Southmoreland program a "PIMBY," as in, "Please, In My Backyard."

click to enlarge Crosby Kemper III
  • Crosby Kemper III
Crosby Kemper III, the Kansas City Public Library's executive director, is troubled by the proliferation of housing programs. The 43rd and Main TIF plan, Kemper says, was created so that H&R Block might expand its presence in Kansas City. "The project wasn't about the neighborhood," he says.

The library, Jackson County and the Kansas City, Missouri, School District lobbied the TIF Commission to end the 43rd and Main plan and put the land and the buildings therein back on the tax rolls. The taxing jurisdictions also wanted a $2.2 million surplus returned to them.

But city officials, who largely control TIF decisions, were reluctant to end the plan without making a constituency happy. In a compromise that left a bitter taste in Kemper's mouth, the Southmoreland housing program will receive $585,000 on top of the $605,000 that's been spent already.

On its face, $585,000 in home-improvement grants hardly represents a gross abuse of taxpayer dollars. But Kemper's frustration seems justified. TIF, after all, redirects property taxes that schools and libraries receive when development occurs naturally. City officials essentially took money that might have been bought books and spent it on façade repair.

Not only did the schools and libraries miss out, so did the residents of Indian Mound, Loma Vista and all other neighborhoods not named Southmoreland. Kemper suggests that if the taxing jurisdictions have to suffer, the housing program "should be available to anyone."

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