This bill would punish us for trying to grow

Legislation proposed by the Kansas Senate Committee on Assessment and Taxation would penalize cities and counties for giving tax breaks to prospective businesses and industries



February 22, 2024 - 2:58 PM

Sen. Caryn Tyson, R-Parker, is chair of the Senate Committee on Assessment and Taxation. Photo by Kansas Reflector file photo

When it comes to saving taxpayers money, Kansas lawmakers are confusing prudence with punishment. Proposed legislation would penalize cities and counties for giving tax breaks to prospective businesses and industries.

If cities and counties were to extend such perks, according to Senate Bill 468, they could not exceed their revenue neutral property tax rate adopted the previous year to accommodate the inherent growth.

The bill originated in the Senate Committee on Assessment and Taxation. Sen. Caryn Tyson is its chair. 

According to the bill, any governing bodies that issue tax abatements, industrial revenue bonds and other economic development tools “shall be limited to generating the same amount of property tax revenue as levied the previous year.”

Could this be any more anti-growth?

The bill also gives cities and counties no recourse. 

Currently, taxing entities must hold public hearings — or what city administrators like to call “public floggings” — when they need to increase their budgets. 

For most, the single line item of ever-increasing health insurance will trigger the need.

In the case of Senate Bill 468, however, entities that would exceed their RNRs because of the tax exemptions would need to cut expenditures elsewhere. In most cases, that would mean positions and critical services.

The proposed measure is counterintuitive.

If the goal is to lighten the load on taxpayers, then a funding base needs to be broadened.

A goal in luring prospective industries with tax abatements is the knowledge that after a relatively short period of time they will be on a city and county’s tax roll big time, more than paying their share for road and bridge maintenance, schools, water lines and municipal services.

The money put up front to help industries get established is more than offset by what they pay in utilities and taxes, not to mention the additional families they bring to our communities.

It’s by spreading out the tax burden that you keep a community growing and moving in a positive direction.

It’s also a competitive world.

Companies expect to be wooed. 

Which is why tax abatements, industrial revenue bonds and TIF (tax increment financing) designations are a municipality’s necessary tools. 

Senate Bill 468 puts taxing entities between a rock and a hard space: Either they eliminate economic development projects or they cut critical services.

Neither is tolerable.

— Susan Lynn