Page 3 of 7
Seated before the legislators were Wayne Carter, president and CEO of the Kansas City Area Life Sciences Institute (a research proponent), and Pete Levi, a Polsinelli lawyer doing pro bono work for the KCALSI.
Dan Tarwater, a longtime county legislator, asked Levi what would happen if one of the hospitals or UMKC successfully marketed a medical treatment that had already been in development before the tax passed. Could the institutions make some argument to keep some of the profits from the treatment?
"What's to stop an institution, from them saying, 'We were 50 percent of the way there,'" Tarwater asked. "So we [Jackson County] get 20 percent of the 50 percent? What is going to happen?"
"That will have to be one of the first things ironed out and presented to the board of directors. I can't give you an exact answer today," Levi said. "Right now, there's no particular device, no particular drug we can identify that's currently being developed or marketed."
An early copy of the proposed ballot language stated that 20 percent of profits from the commercialization of treatments developed in Jackson County would go back to the county's health-care foundation. But no reference to that 20 percent appears in the ballot language that legislators approved.
Levi tells The Pitch in an e-mail that the 20-percent profit-redirection language was taken out because it seemed confusing. He adds that because Jackson County Executive Sanders signed a memorandum of understanding — also signed by all the parties involved, such as Children's Mercy, St. Luke's and UMKC — the language can't be changed without the approval of all involved.
The Pitch wrote back to Levi, asking if the memorandum of understanding is a legally binding document, thus ensuring that the 20 percent would indeed go back to the county. Levi did not respond.
Brad Bradshaw, a physician, lawyer and leading opponent of the tax, doesn't think it is binding.
One of the main parties pushing for the tax is the Civic Council of Greater Kansas City, a nonprofit organization of local business executives who pool their influence and finances for various causes.
That they've played a role in pushing the tax so close to the voting date has been an annoyance to other civic types.
"I think it's a sign of very bad acting on the Civic Council's part that they do this in such a way that it comes out in August for approval in November, giving us no time to talk about it," says Crosby Kemper III, CEO of the Kansas City Public Library.
Tax proponents zeroed in on the November 5 ballot after Sanders announced that he wouldn't put his transit proposal up for a vote this year. Sanders couldn't work out agreements with railway companies to share their tracks for a commuter rail system. But why not put the research tax on the April 2014 ballot, when there could be more time for discussion?
That April ballot may have some other issues, like the proposed Kansas City Charter revision.
Levi says having the vote in November allows the public to focus on one issue.
"There has also been so much energy to make this happen, putting it off until April, there was a chance for that energy to dissipate," Levi tells The Pitch.
Mark Jorgenson, president of U.S. Bank in Kansas City and a member of the Civic Council's executive committee, acknowledges the skepticism about the research tax's timing.
"I understand the cynicism and if not involved, I would harbor some of the same thoughts," Jorgenson tells The Pitch. "Something like this, with as many partners, is complicated in terms of trying to put together the right organizational arrangement. You've got Children's Mercy, you've got UMKC, you've got St. Luke's, you've got Jackson County. You've got a lot of constituencies, and it takes awhile to make sure what you're putting together makes sense."