City officials are seeking a balanced economic development policy. That’s the conclusion of Herbert Hardwick, a consultant hired to assist in drafting such a policy for the city of Gardner.
At a work session last week, Hardwick walked city council members through a discussion about economic development.
“The city is at a pivotal point,” he told council members. “We’re trying to determine what’s most important. What are your priorities?”
He began the discussion by presenting information about two recent Kansas projects – a Mars candy manufacturing project in Topeka and a hotel project in Goddard, Kan.
The city of Topeka donated 150 acres of land, offered an 100 percent abatement for 10 years, waived building and permit fees and provided free utility hookups. The state of Kansas also will allow the Mars plant to keep up to 90 percent of its state income taxes for a period of years. In return, Mars Chocolate opened a 500,000 square-foot candy manufacturing plant that will include up to 400 jobs.
Hardwick asked council if that’s something they would consider.
Mayor Chris Morrow said it would depend on a cost-benefit analysis. He noted that Topeka is fairly self-contained and employees of the plant are likely to reside within Topeka city limits. The same might not be true of a community so close to metropolitan Kansas City, Mo.
“If we build a similar plant here, people may or may not live in the Gardner city limits,” Morrow said. “They may be going to shop in Olathe or Overland Park or something like that. We’d need to see a detailed cost-benefit analysis.”
The city of Goddard, a Wichita suburb, used STAR bonds to raise $25 million worth of capital for a 150-room hotel project. The project coupled a city-maintained aquatic center and athletic complex with the hotel. Goddard has a population of 4,400, and an annual city budget of approximately $10 million.
Hardwick asked council members what was most important to the council: job creation, diversification of the tax base or attracting certain retail segments.
Council member Todd Winters said diversifying the tax base was probably the most important.
“But I think they’re all pretty important,” Winters said.
Heath Freeman, council member, said job creation and certain retail segments will come as a result of tax base diversification.
There is a long list of economic development tools that a city can use.
In the past, Gardner has used abatements, tax-increment financing, special benefit districts and industrial revenue bonds.
“The city of Gardner uses a handful of incentives as compared to other cities,” Hardwick said.
Kristina Harrison, council member, said offering incentives doesn’t guarantee development, but not having access to incentives will limit developers from taking a look at the city.
“At this point, it’s more about the variety or what you’re willing to entertain and making sure that’s visible,” she said. “We’re at a disadvantage right now because we don’t have this information on incentives readily available.”
She suggested a development strategy that included a tiered approach, where incentives would be offered and expanded as project benchmarks – like added jobs – are met.
Council members also discussed what types of businesses they’d like to attract. Morrow noted that Edgerton has a very specific incentive policy to attract industrial development.
“I’m not sure we want to compete with them when it comes to distribution centers,” he said. “If we can lure someone, great, but I don’t want to compete with them. I want to see more about the Olathes, the Ottawas, the Lenexas – the people that are along (Interstate)35. Places like Liberty and Kearney. Those are probably more along the lines of communities we’re going to be competing with.”
Freeman said the city doesn’t have to say yes to everyone.
“But you have to be prepared to say yes to those who are a best match in a hurry,” he said.
That includes industrial development, according to Freeman. Because Gardner is part of a transportation corridor along I-35, he said distribution centers are interested in the community now.
“We have to be prepared for that,” Freeman said. “We’ve got pieces of land that would be a good fit for that.”
In addition to fostering a discussion with city council, Hardwick also met with a blue ribbon task force of local businesses and developers.
He said their priorities for Gardner would include making sure all incentives are available, creating incentives for existing businesses, leveraging TIFs for public improvements and streamlining the city’s incentive process. Developers, he said, are looking for high-energy, friendly people to interface with them.
“Generally speaking, incentives improve quality of life,” Hardwick told council.
Hardwick said he hopes to help develop a policy that compliments the city’s comprehensive and strategic plans.
“Our task will be to take your feedback today, and take that feedback from your task force and try to develop a policy in line with your wishes and desires,” he said.
Council member Steve Shute did not attend the meeting.
City officials discuss development strategy