A group of Wichita residents say they're fed up with what they call a misuse of their property taxes. They're tired of the city giving their tax dollars to developers. So an effort is underway to let the public decide whether the incentives are needed and deserved. "We have to put a stop to this insanity, at least what I consider insanity with our taxes," said Donald Fender
Americans for Prosperity started a petition drive Friday. The group is upset with the city council's decision to provide millions of dollars in tax incentives to build a boutique hotel downtown. "Who would go down now and try to build knowing this hotel was subsidized so heavily," said President of the Kansans for Liberty Craig Gabel.
To prove their point, they have 60 days to collect about 2,500 signatures. If that happens, the public could be given a chance to take back a portion of the incentives, about $2.25 million. The money would come from guest taxes.
The council approved a charter ordinance to allow the developer to keep some of the guest tax instead of putting the money towards the convention and visitors bureau. Since the council passed a charter ordinance, state law allows a petition to be circulated. No other parts of the incentive package are eligible for reversal by the public. "It's going to give people a voice to be involved with downtown development," Gabel said.
But developer Paul Coury says losing the incentive would not only hurt the hotel, it could also hurt future projects. "When you see this being challenged it makes it more difficult for a developer looking at this market to take the risk," he said. Coury says he's still weighing what kind of impact losing the guest taxes would have on his project. He says there's a chance it could cancel the whole thing or make them scale back.
Coury says he wouldn't be able to build this hotel without the help of tax incentives. He says in this economy, the only communities experiencing building growth are those offering assistance. He's building a similar hotel in downtown Kansas City, Missouri. He's receiving millions in incentives for that hotel too.
But Americans for Prosperity says the city shouldn't pick and choose who gets money to build. They hope to gather the signatures so the people can decide what they think. If they are all collected and certified, the council could first decide to rescind the incentives. But that would end up cancelling all of them and not just the guests tax. If the council doesn't rescind, it goes to a public vote that Coury would be required to pay for.