By Bryan Horwath Reporter, Wichita Business Journal
Wichita city leaders are bringing back a speculative industrial building program.
At Tuesday's meeting, the City Council voted 6-1 to reimplement a program that was first introduced in 2012. The program, which will be a little different than the one that ended in 2014, utilizes industrial revenue bonds to provide a sales tax exemption on construction materials and property tax abatement for perspective businesses.
The property tax abatement would last for up to 10 years. Buildings would receive a 95 percent abatement for the first five years and a 50 percent abatement for the second five years.
According to city documents, companies would have to lease at least 25,000 square feet of industrial building space and at least 10,000 square feet of "flex" building space (facilities that have both industrial and office expanses).
Mayor Jeff Longwell was the lone council member to dissent, citing concerns about creating an un-level playing field for certain companies.
Businessman Jeff Lange said Wichita has been missing out on opportunities because of its lack of ready-to-use industrial space.
"There are multiple buildings that are being built across the country and multiple buildings that are going up in south-central Kansas outside of Wichita," Lange said. "This program can help those businesses that are already in Wichita. If they're ready to expand and there's no room here, they'll move on. The intent of this program makes all kinds of sense."
The parameters of the new program will be revisited on an annual basis. Three buildings, all featuring at least 95,000 square feet of space, went up as part of the program that ran from 2012 to 2014.
The program, according to city officials, was vetted by various members of the business and construction communities, along with representatives from the Greater Wichita Partnership, which has been lobbying for more industrial space.
"The thing is that you have to have the product (buildings) available when a company wants the product," said Gary Schmitt of Intrust Bank and the Greater Wichita Economic Development Coalition. "That's whether it's a company here or if it's coming from out of town. Historically, our product (in Wichita) has been very limited."
"Just go drive up I-35 and see what Park City's done the past 10 years. They've had product available, so companies from Wichita can move north to enjoy tax abatements and also enjoy the type of building they want."
Under the program, each incentive project will be presented to the City Council for approval with the fiscal impact to the city identified at that time, according to city documents.