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Development debate heats up as vote gets closer

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Updated: 2/22 6:09 pm
WICHITA, Kansas (KSN) – Is it a vital tool to help the city lure development and jobs downtown?  Or have developers profited enough from backroom, sweetheart deals?

In less than a week, voters will have to decide if the city should kick back 75% of the guest tax on the new Ambassador Hotel to help developers turn the old, abandoned Dockum Building into a new, boutique hotel.

“You've got to be competitive as a city and Wichita competes with other cities to attract people like me,” said Paul Coury, the lead developer of the Ambassador.

The project promises as many as 500 construction jobs over the next year as well as 120 more jobs at the hotel once it’s finished.  A WSU study predicts the project could create 400 more jobs at other businesses.

After opponents forced Tuesday’s referendum vote, Coury was forced to pay the costs of staffing the polls.  He says he’s concerned altering a deal between the city and developers with a referendum vote could have a chilling effect on future development in the city.

“You have to have incentives to attract developers or they'll go somewhere else,” said Coury.

Radio advertisements run by opponents question how far the city should go to lure developers.

Bob Weeks points out the project has already locked up $15 million in incentives regardless of the referendum on keeping 75% of the guest tax.

“The people have seen that yes - we've been very generous...but at some point enough is enough,” said Weeks.

Weeks has been a long time advocate for the free market and believes it’s not the government’s place to “pick favorites” by choosing who gets incentive deals and who doesn’t.

“We don't think its good public policy, it sets a template for every development following,” said Weeks.

Polls open on Tuesday at 6 a.m.

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Empowered - 2/23/2012 11:55 AM
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Erikkko - 2/22/2012 11:44 PM
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I have three objections to rebating 75% of the hotel tax back to the developers: 1) When communities compete with each other by offering tax incentives to companies to do business in their area, they are playing beggar-my-neighbor with other communities. It is a situation in which the communities lose overall, and private enterprises can only profit. What must not be forgotten is that those tax rebates are paid for by local people either through the loss of the services that those taxes would have paid for, or by having to make up the deficit in the cost of providing those services through an increase in the local income tax, sales tax or property tax. Over the years, this leads to a significant shift in the tax burden away from profit-making enterprises and onto private citizens. I do not think this is right or justifiable. 2) In the present case, the developers have already benefited from a $15 million package of incentives paid for by taxpayers. Is there no limit to the greed of these people? 3) According to what I have read in the Wichita Eagle, a typical daily room rate in the planned 'boutique hotel' will be around $150. This is far more than the average Wichitan would or could be able to afford, and yet they are the ones who will be (and are already) paying for the development. What if the developers were planning to build a theme park intended to attract wealthy out-of-town visitors with entry prices set at $150 a head, but to whose cost local people were still expected to make a multi-million-dollar contribution? If local people could not afford to enjoy those facilities, how reasonable would such an arrangement be? Yet this is exactly the kind of deal that the developer is proposing. I urge Wichita's voters to mobilize in opposing the deal and voting NO on February 28.
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