Kent Heermann, president of the Regional Development Association of East Central Kansas, along with Jeff Longbine, RDA chairman, answered reader questions about the ballot question to extend Emporia’s half-cent sales tax until 2024. This is a transcript of that online chat for those who missed it.
Q What are you going to do different if the proposal passes? Do you have any quotas to meet? Do you think Emporia is growing and how? Are there more jobs today than when you began the RDA? Do you need to add to your staff like maybe a salesman?
A The RDA reviews its marketing plan to reflect the current trends and projected economic conditions. This past and current year we have been interacting with Kansas Bioscience Authority and Kansas Bio to position Emporia and Lyon County to be competitive in the growth area of Bioscience.
We have partnered with the Kansas City Area Development Council in their marketing of the Animal Health Corridor with our three animal nutrition pet food plants — Hill’s Pet Nutrition, Menu Foods Midwest and Emporia Pet Products. We are in position to capitalize in that growing sector.
We continue to discuss strategies in partnering with our local manufacturers, Emporia State University faculty, Flint Hills Technical College and other Kansas organizations.
Emporia was growing until 2008; the downsizing at Tyson Fresh Meats will take a number of years for our local economy to adjust. The current recession has stalled any significant growth.
Jobs are created by businesses not government. The RDA encourages and recommends to the governing body performance-based incentives to growing companies. With the new and expanding companies in Emporia over 1,000 direct jobs with a higher than average salaries have been created over the years.
The RDA reviews staffing levels during the budget cycle. With the decline in sales tax receipts the RDA budget will be flat in 2011. No new staff is anticipated.
Q What will happen to the RDA and the future of Emporia if the tax doesn’t pass? People need to realize that this isn’t a new tax. And it has brought hundreds of jobs to Emporia and has saved property owners thousands of dollars in property tax.
A We certainly hope the citizens of Emporia review the past record and accomplishments of the RDA efforts to grow the economy. One hundred percent of the funding for the industrial and economic development efforts is coming from the sales tax. Half of the revenue is used for property tax relief, and the other half is split between the aquatic center bonds and industrial and economic development efforts.
In the event that the voters turn down the sales tax, the city commission will have to make some very tough decisions on how to either cut $1 million in essential services or raise taxes equal to $1 million or a combination of both.
Q How can the public get an accounting of what the half-cent tax has taken in, how much went for economic development, how much did the top 10 get, how much is left over? Why can’t it be used to increase enrollment of students on campus at ESU?
A According to the City of Emporia records from January 1, 1995 to December 31, 2009 a total of $27,542,993 was collected from the one-half-cent city sales tax. The city general fund received $13,767,286 or 50 percent. The other 50 percent was spent between the aquatic center bonds $2,474,400 (9 percent) and $11,301,307 (41 percent) went to the Industrial Development Sales Tax Fund.
I’m not real sure what you mean about the “Top 10,” whether it’s Top 10 employers. Most of our larger employers have received some kind of benefit from the economic development sales tax in the past on either the recruitment side or the expansion side.
The industrial sales tax fund currently has enough money in it to fund operations, current commitments and small projects that may come up. It would be very difficult to put together a project the size of Hill’s or something similar based on current revenue projections through 2014.
Q Kent, to me it seems the city government is saying that if the half-cent sales tax doesn’t get passed, they will automatically raise the property tax to make up the difference Why can’t the city government cut spending like the rest of the population has been forced to do over the past few years, rather than basically blackmailing the population saying they have to have this tax reinstated?
A The current one-half-cent city sales tax sunsets on Dec. 31, 2014. In 1994, the City of Emporia mill levy was 46.915 mills; today the city mill levy is 41.570 mills or 5.345 less than in 1994 with the property tax relief. See the answer above about the options if the question fails.
Q As land aquisistion is a big part of these costs, is the RDA willing to list the sales prices of the land bought for the last three industrial parks? I mean cost per acre for each industry, and who the land was bought from. It is, however, tax dollars, so it should be disclosed. Could we also break down the wages paid, (per year), of those working for the RDA? Have there been any co-mingling of funds from the RDA, The Chamber, and the tourism/visitors funds? Has the water park been paid off yet? If not , why? Has anyone involved in the RDA ever owned a private business?
A Industrial Park I was purchased in the 1950’s. The funding for the purchase was entirely from private donations from The Committee of Fifty.
Industrial Park II was funded from private funding, the payroll deduction fund and City of Emporia property tax money.
Industrial Park III was purchased on Dec. 26, 1978, for $2,500 an acre. The funding source was the City of Emporia mill levy.
Industrial Park IV was purchased for $2,500 an acre and funded through the city sales tax.
Other parcels of land have been purchased with buildings on the property. The land costs were higher than $2,500 an acre.
Land acquisition costs are increasing. We appeal to the owner’s “sense of community” to help Emporia grow and create high-skilled and higher paying jobs. Some land owners want to be paid a fair market rate and other require considerably higher than market rate.
The RDA has a separate 501(c)(o) not-for-profit corporation. The officers of the corporation have the fiduciary responsibility to be good stewards of the funds from the city sales tax funds.
The RDA receives four quarterly payments from the City of Emporia and is required by contract to provide an annual financial review of the RDA to the City Commission.
The aquatic center bond issue will be paid in full by 2014.
The RDA board of directors are Steve Sauder, Ken Bazil, Scott Briggs, Jon Geitz, Jeff Longbine, Don Hill and Michael Lane. The ex-officio non-voting board members are City Manager Matt Zimmerman, City Attorney Blaise Plummer, Chamber President/CEO Jeanine McKenna and Main Street Director Casey Woods.
The RDA has two full-time staff Robin Nelson as executive assistant and President Kent Heermann. We contract with the chamber for one-third-time receptionist.
Q What is the city’s interest in sending out fliers to households in the city? Why should we vote for this when clearly so many jobs have been lost since this tax was created? Why do we have to vote on this tax now four years ahead of it being repealed??
A The city provided an informational in August 2000 with a freestanding insert in The Emporia Gazette.
The city provided the mailed brochure as informational and not advocating for or against the ballot issue. Both the city attorney and city commission reviewed the content of the informational brochure prior to the mailing.
After careful consideration and city staff recommendations, the city commission chose to place the renewal of the half-cent city sales tax on the ballot on the Aug. 3 primary for the following reasons:
Due to our past successes and our most recent success of the Hill’s Pet Nutrition plant, our performance-based incentive for land acquisition was funded with bonds. The bond payments, the aquatic center bonds and the marketing expenses have committed our future income up to December 2014. So our ability to be competitive from now until 2014 is limited.
Half of the half-cent sales tax is used for property tax relief, which is nearly $1 million a year. That equates to approximately 6 to 7 mills. If the city waited until 2014 and the sales tax were not renewed, then $1 million would have to be cut from the budget and 6 to 7 mills added to the mill levy. I doubt it would be either extreme but it would be a combination of budget cuts and mill rate increases.
Most importantly, and mentioned earlier, was that Emporia is as competitive our resources are limited to close deals with performance-based incentives. We need jobs and not just any jobs, but jobs that are higher-than-average wage. Job creation above the average annual salary may be eligible for performance-based incentives.
The tax is not the reason that jobs were lost. Business models change, and they have to make tough decisions that sometimes mean job losses. It’s quite clear that this half-cent sales tax has created new jobs and they would not be here if the tax were not in place.
Q The city sent out notices in favor of extension of the sales tax. Is paid political advocacy of this sort appropriate for the city?
A The decision to send out the informational piece from the city was a decision that was made by the city commission. The purpose of the piece was to give the voters the information that they needed to make an informed decision. The content of the informational piece was reviewed and approved by the city attorney to make sure that it conformed to election laws and regulations.
Q What is your biggest accomplishment in the last two years for the City of Emporia as director of RDA?
A Our biggest accomplishment as an organization was bringing Hill’s Pet Nutrition to Emporia. This project, because of its size, number of employees and payroll dollars, was very competitive. Many Kansas communities worked trying to get the projects, and, ultimately, Hill’s decided to locate in Emporia because of location, land availability, quality of work force and the ability of the RDA to coordinate the effort.
Q You were interviewed earlier this year on KVOE blog radio show, saying a company that makes concrete substructures for wind turbines inquired about locating in Emporia. They wanted rail access and 200 to 250 acres, and Emporia didn’t have that to offer. You were asked during the interview if you referred that company to other nearby towns along the railroad, such as Neosho Rapids or Strong City. You said no, they didn’t have anything to support that company and it was flood plain and no space suitable (which is totally erroneous). You said the company chose to locate in Hutchinson. That provides virtually zero direct economic benefit here. Why don’t you refer companies to outlying towns if Emporia can’t accommodate them, or doesn’t want to, and let the local town and the company meet each other and make their own decisions? You are denying those locations the potential opportunity for a new business by not even referring the company to them. Emporia and Lyon County would still gain economic growth if a company located in Neosho Rapids, Strong City, Lebo, etc.
A The RDA, as a regional organization, always looks for available sites within our county and surrounding counties. For example, the RDA was the lead agency in attracting the Westar’s Emporia Energy Center in northeast Lyon County in 2006. We have also worked closely with communities such as Chase County and Coffey County on economic development projects that they have. One of the challenges that we have in referring large projects to smaller communities is most often the infrastructure is not in place to support the facility.
Q What qualifications does the RDA have for businesses to qualify for incentives?
A The RDA has policies that are developed and approved by the city commission and county commission that are based upon job creation, capital investment on real estate and buildings, and employee wages that are above the average manufacturing wage in Emporia. A formula is used to calculate the base incentives based upon those three thresholds.
Q Lenze left right before they were scheduled to start paying property taxes. What steps have been put in place to make sure that situation does not repeat itself? Out of the companies brought to town under the incentives program, how much have they contributed to the property tax base in the city of Emporia?
A There seem to be a lot of misunderstandings and Emporia folklore about the Lenze project. Lenze located in Emporia because Didde Web Press was one of their largest customers. When Didde Web Press closed, it did not make good business sense for Lenze to continue to operate out of their facility in Emporia. Property tax abatement was granted for 10 years, and property taxes are due and have been paid each year by the owners of the property. The community continues to receive taxes paid on that facility each year and will continue to do so as long as the facility is there.
Q How full are our existing industrial parks and what are we doing get more space? How soon will it be available?
A The community’s older parks, Nos. 1 and 2, are basically filled at this time. Park 3 has six smaller lots that may or may not be able to be combined for a larger tract depending on the industry. Emporia Enterprises has invested in a 160-acre tract, Park 4, located west on U.S. Highway 50. This park currently does not have infrastructure in place, and it is the goal of the RDA and the city commission to develop this park as funds become available. The earliest that could be reasonably expected is three to five years.
Q How competitive is economic development? Are our incentives competitive with other Kansas communities?
A We continue to see other Kansas communities becoming more creative and spending more dollars to attract jobs to their communities. Economic development is a very competitive business that requires professional knowledge, available resources and a cohesive community. Communities such as Topeka have become very competitive because of available resources, marketing, land development, aggressive performance-based incentives. Virtually all first- and second-class cities in Kansas have an economic development program to some degree. Progressive communities fund these efforts because they realize that without them, communities become stagnant and there is no growth.
monserrat001 (anonymous) says...
yeah that is true, major brands do give out free samples of their popular health products best place to get yours is http://bit.ly/9UAtgc tell your friends and family too
August 1, 2010 at 2:02 a.m. ( permalink | suggest removal )
methusla (anonymous) says...
There is only one problem with you philosphy and logic, Mr. Heerman.
You can not compare Emporia with Topeka, Lawrence, Manhattan, Wichita, Salina or any of the larger Cities.
And the reason is these Cities that you and others are wanting to compete with or become a clone of ... have a much larger taxpayer population, larger jobs base, larger sales tax revenue base and therefore have a much larger revenue income base to draw from .
Your and others problems stem from the fact you and others have the dillusion that Emporia has the same tax revenue base to draw from as these larger Cities.
Therefore if you do not have the same amount of tax revenue base to draw from, expansion, growth, or progression, for you, others or Emporia will never, ever be able to compete with the larger tax revenue base cities and you and the others need to stop trying to convince the City Commission, County Commision and the taxpaying voters that extending taxes and raising taxes to ridiculous levels will make it so Emporia will and can compete with the larger tax revenue base Cities. The only thing you and others will accomplish is to drive Emporia and its taxpayers further into debt and closer to Bankruptcy .
But perhaps you and others really don' t care.
August 1, 2010 at 9:11 a.m. ( permalink | suggest removal )
methusla (anonymous) says...
The other problem I have with all this is ... that most of the land that is looked at as the place for future growth, etc. of Emporia is land owned by some who are possibly conected to the RDA, Emporians for growth or closely connected with the City Commission, County Commission or Commissioners. If that is the case, I am not entirely sure that scenario is totally above board and ethical . That would be kinda like " Insider Trading " in the stock market ... wouldn' t it !!!
August 1, 2010 at 9:20 a.m. ( permalink | suggest removal )
methusla (anonymous) says...
Perhaps the RDA, Emporians for growth and others should take the time to go to the following web page and see what recognized economic experts are saying.
http://www.msnbc.msn.com/id/38507261/...
August 1, 2010 at 10:11 a.m. ( permalink | suggest removal )
create (anonymous) says...
I read that article, methusla. Thanks for the link. You know, it's all we can do to hold on. On one hand, finance experts tell us to pay off personal debt, use cash. Well, many I know have used their cash to pay off or down credit cards and are now saving more and spending less. That's a good thing in my book, but not a good thing in the economy which wants consumers to spend, spend, spend.
Then the economists like the ones in the article predict more of this dreary time and say it's because the feds haven't stimulated enough.
As the King of Siam said, "Is a puzzlement!"
August 1, 2010 at 11:33 a.m. ( permalink | suggest removal )
tbluma (anonymous) says...
One thing that stands out to me is the situation with the railroad.
It was mentioned that one business needed 250/ac. with rail service.
There is no rail service left that doesn't flood unless we go NE of town or build spurs, and RR service is going to be more and more important.
August 1, 2010 at 1:31 p.m. ( permalink | suggest removal )
methusla (anonymous) says...
create,
I too thought it was an interesting article.
And I agree the economic experts, say the Fed and Consumers need to spend more. But then if you give what they are saying some thought ... If the fed spends more in the way of stimulus spending, the taxpayers are still going to have to foot the bill by way of taxes, then if you consider that there are 15 million unemployed in the U.S. , I asked my self how in the world, as former working consumers are these people going to be able to spend more ? Then if you factor in the idea that your local governments, at the urging of others, want you as local taxpayers to extend a sales tax extension for another 10 years, so they may spend more than they or the taxpayers can afford and put their local counties, towns and Cities further in to the " DEBT " pit, as well as the prospect of a hike in property tax rates and public services rates . And I believe that most of us know that if a tax sales tax extension or a property tax hike or public services hike actually takes place ... people will actually spend less. I don' t know about anyone else, but I have asked myself many times, how in the world is this going to make the economy better, grow Emporia or take anyone to a brighter future ?
August 1, 2010 at 3:28 p.m. ( permalink | suggest removal )
methusla (anonymous) says...
And does anyone believe that, If, just If the 15 million presently unemployed were miraculously put back to work and were paying taxes ... that this event would actually keep the Federal, State, City and County Governments from over spending and taxing like they have been for so many years?
I seriously doubt it.
August 1, 2010 at 3:34 p.m. ( permalink | suggest removal )
Steve_Corbin (anonymous) says...
I'm sure not one to believe the government should be the one to stimulate the economy. It usually only stimulates govt. growth. And the last stimulus went to pay excisting debts for most states that got it.
However,
If it's going to happen let the government start a WPA type program to put people to work.
tbluma,
You mentioned rail service.
A nation wide rail system renewal project could put millions to work while improving the infastructure throughout the country. Thousands of engineers, surveyers, and hard labor constuction jobs would be created. Steel factories could be reopened.
Along side the r.r. right of ways, utility easments could provide for new power line grids to help rebuild the nations power grids. Throw in some government loan guarentees for 50 or 60 nuke plants, and solar and wind farm projects and not only would more be employeed, but it may just help wean us off of the imported oil we keep buying, fighting and dying for.
But as long as we keep doing what we always have, things won't become better. There are kids out there going to college and racking up huge student loans, just because the jobs are not there. If this trend continues our country will have the best educated unemployed broke people of any in the world.
August 1, 2010 at 5:52 p.m. ( permalink | suggest removal )
oh4theluvof (anonymous) says...
Why were the second and third sentences (statements) included in this question?
"Q What will happen to the RDA and the future of Emporia if the tax doesn’t pass? People need to realize that this isn’t a new tax. And it has brought hundreds of jobs to Emporia and has saved property owners thousands of dollars in property tax."
August 1, 2010 at 10:02 p.m. ( permalink | suggest removal )
Steve_Corbin (anonymous) says...
With the economy the way it is now, most businesses are afraid to hire new workers. With newly enacted healthcare mandates and financial reform most are in a "wait and see" mode. Also, the credit market is real tough now, (think REG).
Because of this it would be nice to know, how many of these local industries that have recieved "perfomance based incentives"
are hiring temporary workers at below the wages stated when they recieved the incentives.
And did those jobs created listed on the cities flyer include temp workers, working at a lower wage?
Also some of the top paid wage earners of these industries live outside of Emporia and commute daily from Topeka, Chase, Coffee and Morris counties. How does THAT help create high paying jobs for Emporia?
August 1, 2010 at 10:30 p.m. ( permalink | suggest removal )
mslater (Matt Slater) says...
If it's going to happen let the government start a WPA type program to put people to work.
YES YES YES!!!
August 2, 2010 at 9:19 a.m. ( permalink | suggest removal )
methusla (anonymous) says...
Steve,
Just wanted to let you know I advance voted this morning at 8:30 a.m. and I was number 914. It appears there may be a fairly good turn out for this vote.
August 2, 2010 at 9:31 a.m. ( permalink | suggest removal )
fromaglance (anonymous) says...
Angry people. So, when all of you pass on, who will be left to lead the community?
August 2, 2010 at 10:42 p.m. ( permalink | suggest removal )
REWBA (anonymous) says...
Clint Bowyer
August 2, 2010 at 11:37 p.m. ( permalink | suggest removal )
oh4theluvof (anonymous) says...
I could've sworn I posted this last night, but I don't see it.
Anyhow, I think it's a conflict of interest to have a member of the RDA be the lawyer who reviews and approves the pamphlet.
I'm just sayin.'
August 3, 2010 at 12:23 a.m. ( permalink | suggest removal )
oh4theluvof (anonymous) says...
"So, when all of you pass on, who will be left to lead the community?"
Ummm...the kids of people who might move here or that live here and don't end up moving. Of course, if everyone moves away and no one moves in, it's kind of a moot point, now, isn't it. Anyway, that's still quite a way off. My kids aren't even all in school yet.
August 3, 2010 at 12:29 a.m. ( permalink | suggest removal )
seriouslyfolks (anonymous) says...
So we have these people from California get on here all the time and insult us and say that the Midwest is dying and will soon have no inhabitants and then they ask who will lead us then. Well if'n thar ain't nobudy here then I reckon there won't be no need for leaders cuz if'n I remember correctly from my days in the service, leaders aren't needed if'n there ain't nobody to lead. I think that the people from California should do a better job of remembering their insults so they don't contradict each other. Just a friendly suggestion because with you insulting us constantly I figured you need somethin' friendly.
August 3, 2010 at 12:42 a.m. ( permalink | suggest removal )
Steve_Corbin (anonymous) says...
fromaglance,
Are you a former Emporian who has moved away? Better job, standard of living? Just wondering.
After we pass on, who will lead?
Not sure, I just don't want to saddle them with paying off our debt because we were too lazy to stop the spending now.
August 3, 2010 at 6:45 a.m. ( permalink | suggest removal )
sail (anonymous) says...
Well, Kent why cant the econ tax be used for increasing students on campus at ESU?Its a cause the community could support.
August 3, 2010 at 8:05 a.m. ( permalink | suggest removal )
methusla (anonymous) says...
fromaglance
You had better take a good long look at the leader of Kaaalefornia and ask yourself what kind of a leader he has been and whether you want him Baaaak as leader.
August 3, 2010 at 1:31 p.m. ( permalink | suggest removal )
oh4theluvof (anonymous) says...
Did any of the coverage on this include the wording on the ballot, "to be used for general funds, including, blah, blah, blah?"
I just don't remember knowing that general funds get it first and all this RDA stuff is down the line. Maybe they did and I just missed it. Not that it matters anyway. You can't fool all the people all the time, but in Emporia you can fool 2/3 of the people all the time and it comes out the same.
August 4, 2010 at 1:04 a.m. ( permalink | suggest removal )