Wednesday, July 28

West Wichita CID should not be approved

Twenty-two Wichita hotel owners near the airport do not deserve this unfair competition for hotel rooms that should be built with private funding, writes John Todd. A version of this appeared in the Wichita Eagle. For more about this issue, see Wichita CID illustrates pitfalls of government intervention.

Last Tuesday, on a 5-2 vote the Wichita City Council approved the first reading in the process of awarding a 2% CID sales tax incentive to Natman Real Estate International for the development of a new west side hotel with added retail space near the airport. Under the plan, the additional sales tax revenue collected by the project would be diverted back to the developer to finance up to $8.8 million of his total $16.8 million project cost. WOW, this is roughly 52% of the total project cost! Mayor Jeff Longwell and City Council Member Bryan Frye wisely voted no to this funding plan.

From Google Earth, a view of the restaurant and hotel on the subject property. If a house this blighted had been owned by a poor inner-city resident, the city would have long ago condemned and demolished the buildings, at the homeowner's expense.
From Google Earth, a view of the restaurant and hotel on the subject property. If a house this blighted had been owned by a poor inner-city resident, the city would have long ago condemned and demolished the buildings, at the homeowner’s expense.
During City Council hearings on this proposal to fund a new Westside airport hotel, a competing hotel owner and manager spoke out passionately in opposition the use of government incentives to fund a new hotel that would be in direct competition to their privately funded hotels. Both cited how unfair this was to their existing businesses not to mention the dozens of people they employ whose jobs could be jeopardized by the unlevel playing field created by this government sponsored plan.

Public records show that Natman Real Estate purchased this distressed and financially troubled property as part of a mortgage foreclosure action on a previous property owner on April 27, 2014. Before committing their money to purchase the property, they should have, and I expect did, consider their costs of either rehabilitation or demolition of the property.

Now it appears that Natman Real Estate is either asking for what gives the appearance of a government “bail-out” or at least a financial advantage over other competing hotel owners who built their properties without government assistance. I believe this is wrong!

Twenty-two Wichita hotel owners near the airport do not deserve this unfair competition for hotel rooms that should be built with private funding.

On September 8, the Wichita City Council will have another opportunity to stop this unfair treatment of competing Wichita businesses. If you agree that the CID funding is wrong, please contact Mayor Longwell or your Wichita City Council member before next Tuesday and urge them to do the right thing by rejecting this outrageous CID funding plan.