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Wichita City Council hears more details about sales tax options

Published on -7/23/2014, 10:09 AM

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WICHITA (MCT) — In the coming weeks, Wichita City Council members likely will consider two alternative ballot languages that could be part of a 1-cent sales tax ballot measure in November that would generate about $400 million over the next five years.
The first option would include a new water source, jobs development, city transit and street repair and maintenance.
The second option would include a new water source, city transit and street repair and maintenance, but would have jobs development as a separate question to be voted on.
"Of these four components, three of them are expense, flat out. The other one is the revenue-generating piece, and that's what's going to bring us growth in our community," council member Janet Miller said of keeping the job development proposal with the other three.
"Splitting off the revenue generator from the expense is something we better really deliberate on."
The discussion came after Gary Schmitt, chairman of the Greater Wichita Economic Development Coalition, presented more details on the job development portion of the proposal, which would require about $16 million each year over five years to potentially bring in about 20,000 more jobs.
Sedgwick County has had about 1 percent job growth in the past decade, he said.
Part of the jobs fund would include a regional economic development strategy, with the coalition working with Wichita State University, the Wichita Metro Chamber of Commerce and the Wichita Downtown Development Corporation. The process would have oversight from a citizen committee and a jobs commission audit committee.
Some of the targeted areas for future diversification could include drones, information technology, cybersecurity, additive and advanced manufacturing of things like health care devices and value-added agriculture, Schmitt said.
About 40 percent, or $32 million of the job development funds, would go toward infrastructure for things like a sewer system for Wichita State's new Innovation Campus, rail spurs, new runways and broadband Internet.
Another 40 percent would go toward workforce training, including working with educators at Wichita State and Wichita Area Technical College for summer employment, youth internships, career counseling and other training.
The remaining 20 percent would go toward reimbursement costs, expansion and other projects, like robotics, at the National Institute for Aviation Research, Schmitt said.
But council member James Clendenin said he wants more details about how the money would be spent.
"We really need to see some detail about how we're going to spend this money and let the community know how we're going to spend this money," Clendenin said.
"There's still a misconception that this is an $80 million slush fund, and we're going to have $80 million just floating through here for government to spend and giving cash to companies. There's a lot of work that needs to be done so the public knows what's being proposed. ... I don't think it can be done by just throwing cash at jobs."
The council is scheduled to vote Aug. 5 on whether to include the sales tax measure on the November ballot. The deadline to place measures on the ballot is Aug. 18.
Also during the council's Tuesday workshop, Alan King, director of public works, told the council that previous $250 million estimates for a new Aquifer Storage and Recovery plan may be higher than needed.
But city offices are still getting more solid numbers on the project as they finish a report on the 1 percent design of the project.
"The big wild card is what are contractors actually going to bid," King said.
King's office said it is recommending the ASR project over other previously proposed water sources -- including treated or untreated water from El Dorado -- for several reasons.
"We think it will be less than the $250 million, whereas with the El Dorado options, those will be $250 million by the terms they proposed to us," King said. "We could have the option of retiring the sales tax early with ASR."
The ASR plan also would include adding a parallel pipeline from the city's well field, reducing the vulnerability of the current supply, he said.
"Should that one pipe fail, there would be drastic consequences," he said.
Additionally, the ASR would allow the city to put more water in the Equus Beds aquifer, slowing the saltwater migration into the well fields that is expected to happen in coming decades.
"It buys us some time on saltwater migration," he said.
He also told the council there would be significant savings if sales tax money was used up front to cover capital costs rather than increase rates and have to borrow money.
City Manager Robert Layton says he still recommends $250 million as the portion of funding dedicated to a new water source as a contingency until the final design of the ASR is completed.
"If the project comes in less than that, then we have the option to retire the sales tax," Layton said. "I think the community said clearly it wants a resolution to the water problem."
During the council's workshop, several members said it was important to do what they said they would do if they get the necessary revenue before the end of five years: retire the sales tax.
It will be easier to scale back the amount for the project once there are more solid numbers than work with less than needed, Mayor Carl Brewer said.
"Whatever the case is, if we don't need it, then we certainly shouldn't take it," Brewer said.
(c)2014 The Wichita Eagle (Wichita, Kan.)

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