Thursday, July 30, 2015



Economic development - Debbie Nuss



To what extent should the city link economic development incentives to specific wage levels, and what should those wage levels be?

The city should require, by ordinance, that businesses that receive economic development funds pay their employees a wage of no less than $12/hr. (130% percent of the poverty level for a family of three). Public tax dollars should not be used to subsidize low wage jobs. While the current economic development formula gives credit to businesses that pay at least $12.80/hr., it is only a guideline. If a company pays less than $12.80/hr. the commission could still approve their application. It is often argued that companies won’t apply for funds if a wage floor is required. The last three businesses that applied for economic development funds were willing to pay the wage floor so there is already ample evidence that it doesn’t discourage businesses from applying or place an undue burden on them if they do. When asked, the chief financial officer of another company that applied for economic development funds said they would have met the wage floor had it been a requirement. It’s important to note that only 26% of the funds collected over the decade of the last ½ cent sales tax went to job creation (the remaining 74% went to infrastructure projects that supported economic development). Nearly half of the jobs created were low wage jobs and not high quality jobs the community was promised.

What kinds of economic development are most important to the city?

The city should focus on recruiting and supporting existing businesses that provide job security and upward mobility for Manhattan’s existing workforce and that encourage K-State graduates to remain in our community. Businesses that pay good wages and provide good benefits allow our residents to live in our community and become permanent tax paying citizens. Our economic development initiatives should continue to build on the research strengths at Kansas State University, the work force being developed at Manhattan Area Technical College, our existing skilled labor force, and the possible construction of the federal research lab.

Should the city use tax abatements to bring businesses to Manhattan?

Tax abatements should only be used under extraordinary circumstances and only with the unqualified support of the County and the School District because of the potential loss of revenue to both.

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