Columbia City Manager Mike Matthes seems to be fond of revising tax-increment financing history. In “Columbia ponders increased use of popular public financing method,” Matthes cited Independence, a suburb near Kansas City, as an example of a successful use of tax-increment financing. Does Matthes consider the Bass Pro Shops TIF in Independence a success? The city of Independence has had to kick in more than $4.1 million to cover bond payments associated with that project.
Matthes also said that “(TIF) does prevent and eliminate blight” and that “it does increase property value and tax revenue over time.” In Missouri, this is far from the truth.
Kansas City has moved to pay $15 million to purchase property that was razed and contaminated with asbestos. The Citadel Plaza site now sits vacant and is an example of a TIF project that made an area much worse, instead of eliminating so-called blight.
Moreover, The Wall Street Journal recently called another Kansas City TIF, a downtown entertainment development, a “budget hole.” This year, Kansas City will likely have to pay $12.8 million to help make debt payments for the project.
On the eastern side of the state, TIF does not look much better. A multi-year study of TIF and other development subsidies in the St. Louis area found that subsidies were concentrated in “higher-income communities.” The same study found that retail jobs associated with TIF projects came at a cost of more than $370,000.
Perhaps I am being unfair. When Matthes said that TIF has proven to eliminate blight, he might have been referring to the TIF awarded to a St. Louis area mall. The mall was deemed “blighted” because it lacked a Nordstrom. I suppose because the West County Center now has a Nordstrom, one could consider the “blight” removed.
Audrey Spalding is a policy analyst for the Show-Me Institute. Questions? Contact Opinion editor Elizabeth Conner.