School district’s abatement role called legislative non-starter
De Soto USD 232 and other Johnson County school districts would like a say in who will receive tax abatements, but it likely won't happen according to local representatives.
The school board is asking the Kansas Legislature to give school boards the right to decide if local tax abatements should apply to the school district's share of the local mill levy. The measure was among the items on a 2008 legislative agenda the USD 232 school board approved earlier this month.
De Soto's representative in the Kansas House said their was little chance the Legislature would act on the request. Rep. Anthony Brown, R-Eudora, said the state already is struggling to get businesses and grow economically.
"For that to be done this year is probably a little bit of blue sky -- too much hope," he said.
The item isn't new to district legislative platforms, said Owen Donohoe, R-Shawnee.
He said seven or eight years ago a similar measure was introduced in the Legislature, but it did not go through.
"I think there is so much opposition to it that even if many (school districts) came together, it's probably something that is not going to transpire," he said.
Another issue affecting tax abatements is competition for businesses, said Jim Martin, Shawnee executive director of economic development.
"Should something like this be enacted, it would put the state of Kansas at a tremendous disadvantage when competing for projects that are looking at both sides of the state line," he said.
If a city decided to offer or not offer tax abatement, it would affect competition within the state as well, Martin said.
"Say, for example, a company was looking in Shawnee or Overland Park, they would probably pick the location that would provide the tax abatement," he said.
Martin said he saw this kind of competition transpire when he was on the Lenexa Economic Development Council and Simmons, a mattress company, was looking at building its factory in Shawnee or Lenexa.
Simmons chose to build in Shawnee because that city offered a tax abatement not available in Lenexa.
"People can make the case that the businesses will be there anyway, but that is not always the case," Martin said.
The proposed change in tax abatements mostly is directed at pre-existing businesses.
De Soto Mayor Dave Anderson said he supported limiting tax abatements in those cases.
"I don't think (not offering them) inhibits growth," he said. "Part of our selling feature for Johnson County is that you have great schools."
Anderson said when the city looked to attract businesses, it looks for those that will fit in with the community.
"We don't want to attract businesses just for the sake of attracting," he said. "We want to attract good businesses because we are a good community."
And his definition of a good business is one that cares about supporting the community and the school district, Anderson said.
"I think the schools are a selling point, and they need to be economically viable," he said.
The city currently has a policy that allows a 50 percent, 10-year abatement to a business that is looking to expand. That abatement is applicable to the property that is being expanded and not the previously existing property.
If the Legislature allowed school districts to approve or deny tax abatements, it would be a major shift in policy, Martin said.
"Really, the state right now is trying to promote economic development more than ever," he said.
In the meantime, there is an outlet for district representatives to voice their concerns about possible tax abatements, Martin said.
"They do receive notice, and they are welcome to come to the public hearings if they need to express their concerns," he said.