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Don't fritter away hotel money on subsidies
Editorial The Leawood City Council has taken a reasonable step in approving a 6.5 percent hotel tax, which would mimic similar levies imposed in other cities. The city doesn't have any hotels yet, but one is being planned on Nall Avenue between 115th and 117th streets. Others may follow. While the hotel tax makes sense, it makes no sense to subsidize construction, a possibility Councilman Pat Dunn broached earlier this week. Dunn said he would not oppose returning a portion of the "transient guest tax" back to the developer to help finance some part of the cost. "I'm comfortable with it going to finance part of the project," Dunn said. What he's talking about, in effect, is tax-increment financing - and in the process he's offering more evidence of how profoundly corrupted the development-subsidy game has become in our region. Special deals for developers may be acceptable in areas that would be unable to attract capital if not for some extra incentive from the taxpayers. But the site for the Leawood hotel is a desirable location close to the mammoth Sprint campus. In fact, Councilman James Taylor says Leawood will probably attract more than one hotel in the future. Given the attractiveness of the location, why are public officials so eager to subsidize such investment? They're like retailers who believe they can't sell their merchandise without offering discounts and "sales events. " The product in this case is Leawood's desirability as a business location. In this kind of environment, why bother having published tax rates? Just take your favorite developer in the back room and work out a special deal just for him. Mayor Peggy Dunn has suggested a better approach. During the summer, when she first urged the council to approve the hotel tax, she called for spending the money on infrastructure needs such as storm-water improvements and residential streets. This would earmark today's revenues for projects with a useful life of many years. If the city disciplines its spending, such a plan would reduce the burdens of government on Leawood taxpayers generally. That's the whole point of a hotel tax, which is mostly paid by out-of-towners. Why waste such an opportunity in an attempt to subsidize development that will come anyway? Editorials are written by members of the Editorial Board of The Star. In the News |
