In the last few weeks, Johnson County Commissioner Ed Peterson has been making the rounds of his northeast Johnson County district pointing out some disconcerting trends about the local economy. Peterson has appeared before city councils to brief them on county budget issues, but also has been packing a set of slides that show some uncomfortable numbers.
Among the key indicators Peterson shows are per capita revenue from property tax, personal income per capita, the market value of new construction, retail sales, residential permits and commercial permits. Taken individually, each has a possible explanation, Peterson suggests. But taken as a group: “We are looking at stagnation,” he says.
Each of the indicators have taken a long slide since the beginning of the recession in 2008. But aside from that downturn, Johnson County personal income growth over the last 10 years trails both Kansas and the nation in percentage change. It still has higher incomes, but not the growth you expect from the “economic engine” of the state, Peterson points out. A lot of people in Johnson County have dropped down from high income levels and more people are at the poverty rate than before.
The value of new construction has fallen dramatically in the last five years. “We are seeing an uptick in 2013, but it’s not dramatic,” Peterson says. It could be years before it is back to 2008 levels and there are concerns it won’t return to its old stair-step growth model, he says.
In the face of these trends, Peterson suggests that government policy could help add fuel to the local economy. First, invest in infrastructure that will create jobs, tailoring budgets where it can make a difference.
We have an ongoing dispute over school funding, but we need to look at seriously beefing up education funding, he says, where there is value in both K-12 and post-secondary education as economic contributors.
Look at our development patterns, Peterson says, to re-develop the interior of our communities which is more cost effective than outward expansion. It’s more efficient and appeals to younger people, he says. Mixed-use, higher density developments with green space could help, but we have few examples in place. Developments like Mission Farms and the planned Gateway in Mission could be examples that prove the concept, Peterson says.
During the recession, no public sector growth has been helping the economy, Peterson suggests. He points to 300 unfilled, budgeted positions in county government and the loss of hundreds of employees in the Shawnee Mission School District as examples.
One of the slides shows that services provided by county government on behalf of the state have grown slightly through the years, but state support for those services has dropped by double digits over the same period.
“It’s on cruise control at a low speed,” Peterson says of the local economy. “We are in for a bit of a long slog.”
The slides from Petersen’s presentation are below.