Overland Park City Council candidates on the issues: When, if ever, are public finances incentives appropriate?

Projects in downtown Overland Park have benefitted from public finance incentives in recent years.

Last month, we asked our readers what issues they wanted to hear the candidates running for local office address ahead of the August primary. Based on the (ample) input we received, we developed a five-item questionnaire for candidates running for city council in Overland Park.

Today, we begin publishing the candidates’ responses. The first question was as follows:

In recent years, developers have become increasingly likely to seek public finance incentives like tax increment financing and community improvement district sales taxes to pay for parts of their private projects. What’s your stance on the use of such incentives? When, if ever, is it appropriate to commit public finances to private real estate projects?

City Council Ward 1

Holly Grummert

I would consider the following criteria when considering incentives for any new project:

  • Does the project address any unique, unmet needs of the community?
  • Does the data show that the benefits of the project will pay for the cost incurred by the city and its residents?
  • Does the project align with the city’s strategic vision as laid out in the Forward OP plan?

As for real estate projects, I will only consider incentives for developments that addresses the very real need in Overland Park for more affordable housing options.

Terry Happer-Scheier (incumbent)

Tax increment financing is an appropriate tool to utilize in order to avoid and/or reverse declining property values which if left undeveloped will have a greater potential impact of lowering the tax base for the City. TIF is used to promote successful economic development and job creation in the city.

TIF is used to promote successful development of mixed-use development within the city.

TIF is used to promote the successful development of Class A commercial office space in the City without regard to location. TIF is used to encourage private investment and development and redevelopment of property:

  • Within Downtown Overland Park
  • Within a Vision Metcalf node
  • Within Vision Metcalf corridor
  • Along Shawnee Mission Parkway within City limits
  • Within the boundaries of an adopted planning study calling for redevelopment.

The Governing Body Evaluation of projects:

  • The total cost of projects
  • The amount of private funding in comparison to TIF financing. Private funding including equity contribution and/or private financing should be more than 70% of the total project cost.
  • Projects consisting of demolition and replacement with new construction will be viewed more favorably than those of repair and refurbishment of existing structures.

Financial Evaluation of Proposed Projects

1.The financial and economic feasibility of the proposed project
2. The extraordinary or unique cost associated with developing the project
3.The cost of public infrastructure and/or utilities that will make the project successful
4. The developer’s/private equity investment in the project
5. The property taxes, sales and other tax and fee revenue that may result from the project

The level of compliance with existing plans or development programs
The impact on achieving established economic development goals.
The need for public assistance must be demonstrated and documented by the developer and include information relative to the profitability and feasibility of the project both with and without the TIF assistance.

CID can be used on sidewalks, street interchanges, highway access, roads. Intersections, parking lots, parking garages, traffic signals and signs, utilities, pedestrian amenities

Financing Risk: The city will not provide full faith and credit backing to any CID project or in any way put the general revenues of the city at risk to finance a CID project or reimburse eligible expenses.

With all the information I provided I use it to make a decision on proposed projects and request for TIF and CIDS. Using public finances is not to be taken lightly. It deserves to be evaluated carefully.

Taryn Jones

Overland Park has been using too many tax incentives for private real estate projects in the past. I think it’s important to attract business but it’s also vital to not put a small business owners or community members at a disadvantage by giving tax breaks to big business. In my mind, the only time it’s appropriate to do so, for example, is for contractors developing housing which offers affordable living options.

Downtown Overland Park has a history of being a very blue-collar community with neighborhoods like mine. I went to the Avenue 80 apartment complex at 80th and Metcalf and one studio cost around 1,000 dollars per month. With the average per capita income being just under 30,000 dollars a year, it’s important to support business who provide accessible services to the residents of Ward 1.

Financing projects through the use of public finance incentives is reasonable solution to the companies who make a positive impact on our community and not burden those who already work and live here.

City Council Ward 2

Paul Lyons (incumbent)

I helped develop city policies defining general guidelines and appropriateness of granting financial incentives to new development and re-development in our city. Public-private partnerships must be consistent with city goals that encourage development in key areas and address a public need. Specifically, downtown Overland Park and the Metcalf corridor are areas of focus. We have seen great success in private investment in those areas where previously it had been absent for many years. It has had a positive affect on property values in surrounding neighborhoods and nearby commercial properties. Not a single dollar of taxpayer money has gone to those developments. All incentives are generated from the increased valuation and economic activity produced by the projects themselves. The city has undertaken no financial risk and we have strict guidelines not to do so.

I will continue to support public-private partnerships when they are appropriate to address areas of decline, bring new jobs to our city, attract visitors to our commercial establishments, provide amenities that benefit our residents, improve public infrastructure such as streets and flood control, or fill a missing public need. New development and re-development of our older areas are an important part to maintaining a high quality of life and low property taxes for our citizens.

Derek Puzzuoli

I believe the residents of Overland Park should not have to pay for private development projects in areas where development is likely to happen anyway. For instance, a paramount issue for residents is the development of apartment/loft buildings in downtown Overland Park which are too expensive for the majority of people. It is only appropriate to commit public finances to private real estate projects if the development will take place in blighted areas that are not attractive to developers.

Roger Tarbutton

I welcome the amenities that private development can provide to the residents of Overland Park. However, I am not in favor of using incentives such as tax increment financing, transportation development districts, community improvement districts or sales tax revenue bonds for the purpose of luring development by increasing a developer’s return on investment. Overland Park did not use tax incentives twenty years ago and the city attracted plenty of development because of its excellent infrastructure, police and fire protection and public schools. I think we need to be very careful not to risk the hard-earned tax dollars of our citizens on risky business ventures. If a developer requires tax incentives, the development may not be financially sound in the first place. The use of taxpayer funds for private development not only places taxpayer funds at risk, it artificially stimulates development that is not based on market conditions and can lead to overdevelopment. I would generally limit the use of tax incentives to the development or rehabilitation of economically distressed properties that provide measurable and tangible benefit to the City of Overland Park and its residents.

City Council Ward 5

Phil Bressler

The residents of Ward 5 I’ve met understand there is going to be growth, and in fact, most want the improved amenities that come with it. Tax incentives are a part of the development landscape here and across the country. I believe we need to carefully look at each development on its own merit – we don’t need to say “no” to every project and we certainly don’t need to say “yes” either. We need to weigh the facts of each project and make the best common sense decision possible.

In terms of the second question, each situation will vary but if the incentives will be used to impact the greater good of Overland Park residents then they should be carefully evaluated. Incentives can also be helpful in spurring rejuvenation in older parts of the city where properties perhaps have not been well maintained or simply neglected. Not all projects will receive incentives and I believe Overland Park has a strong track record in this area.

John Coughlin

Did not respond.

Faris Farassati (Incumbent)

During the last two years, I have promoted a logical and evidence-based approach for using public finance incentives. There is no “one answer fits all” approach! Each project needs to be judged based on real evidence, including the benefit to the public and local economy and the financial basis for their need for free tax dollars. Such criteria usually exist in blighted and socio-economically suppressed areas NOT prime real estate markets in OP. Tax giveaways cannot be a constant part of each and every development project. Lack of availability of Tax dollars, due to this giveaway, will diminish resources highly needed to enhance city services such as roads, parks, public safety and maintain our high quality of life in OP.

People of OP have repeatedly expressed their stand about this matter. They ask for clarity, fiscal responsibility and redirecting their tax dollars to city services. Free of the pressure by lobbyists, we need to look at this tool as a “possibility in certain cases” and not an always YES! I also want to see a financial analysis of each project by a tertiary authority free of local conflict of interest which can provide elected officials with high quality data they need for decision making.

In short: blighted, socio-economically depressed areas based on real data, YES if the project has a transformative effect and asks for a reasonable amount. A tool for enhancing the profit margin of private entities based on lobbyists efforts but not real evidence, NO!

Tomorrow we’ll publish the candidates’ responses to item number two:

Overland Park has thus far declined to take up a non-discrimination ordinance providing legal protections for LGBTQ+ individuals, with leaders saying they hope the legislature will pass a state law that addresses the issue. Do you support this “wait and see” approach? Do you believe the city council should formally consider a city level NDO?