Kansas City keeps approving subsidies without knowing whether they work

Kansas City Councilmember Andrea Bough made one of the most revealing statements about Kansas City’s economic development policy I’ve read in years.

In a story about $235 million in taxpayer subsidies for an expansion of the KC Current stadium, Bough said, “We can’t say how much economic development has provided in benefits to the city. That is information that we need to have so that we can make an educated decision on projects moving forward. That’s something I hope that we will have soon.”

Bough is not merely a two-term member of the Council. She chairs the city’s finance committee. She serves as board leader for the Economic Development Corporation of Kansas City. She is the mayor’s appointee to both the Land Clearance for Redevelopment Authority and the Enhanced Enterprise Zone Board. Her elected and appointed positions require her to oversee evaluation of subsidy applications and pass judgment on them several different ways.

Moreover, as an employee of the law firm Lewis Rice, Bough’s biography highlights her, “experience in economic development, land use, planning, zoning, and subdivision regulations [which] allows her to represent clients on complex redevelopment projects at the state and local levels.”

How does Bough claim to not have the information she needs to make educated decisions on these deals? It is literally—and I mean that literally—her job.

If the chair of the Finance Committee believes the city lacks the information necessary to make an educated decision, then what has she and the council been relying on for the last few years?

She has voted for or advanced development-subsidy packages involving at least $1.1 billion in public financing or incentives, including nearly $300 million in final approvals and another $835 million in stadium-related deals that still require further action. She may not know if these deals work—but that hasn’t stopped her from supporting them.

Bough’s statement might have been understandable before Kansas City embarked on decades of aggressive subsidization. Instead, it comes after years of approving project after project. The time to determine whether a policy works is before authorizing the next billion dollars—not afterward.

Another issue is Bough’s apparent institutional conflict. As a redevelopment attorney, she works in the same ecosystem she regulates as Finance Committee chair, EDC chair, and an appointee to development boards. Even when no client has business before the council, her professional expertise derives from a system built around subsidies, redevelopment law, and political approvals.

Kansas City has long blurred the distinction between public service and private development. Nearly twenty years ago, The Pitch highlighted a development attorney’s simultaneous service as a city parks commissioner while appearing before the City Council on behalf of developers seeking subsidies. But Bough’s accumulation of overlapping public and professional roles may be one of the clearest examples of that culture in recent memory.

Her resume makes it harder to understand her failure to know whether incentives work.

Nor is the problem that the city lacks information. Kansas City has commissioned studies. The City Auditor has produced studies. Universities have studied these programs. Federal Reserve economists have studied them. Independent organizations have studied them. The problem isn’t the absence of evidence. It’s that the evidence has been ignored or waved away.

As city auditor, Mark Funkhouser issued at least two reports on the impact of taxpayer subsidies. The first was published in 1998. The second, published in 2007, pointed out, “by the end of 2005, active TIF plans produced only 50 percent of promised EATs and PILOTs revenues, a shortfall of about $230 million.”

A 2007 UMKC analysis of TIF in Kansas City reached many of the same conclusions.

The city itself embarked on its own tragicomedy study of economic development incentives, publishing the results in 2018. It claimed that each dollar in economic development incentives yielded almost $4 in return to taxpayers. When the repeatedly delayed study was finally presented to the council, its methodological flaws were so apparent that even supporters struggled to defend it.

But there is a vast body of research on economic development incentives. And not just studies produced by think tanks. Universities, Federal Reserve Banks, and even the labor-oriented Upjohn Institute have published decades of empirical research examining when incentives work, when they don’t, and how governments can design them more effectively.

Despite all this, Bough still claims to not have what she needs to make an educated decision.

Yet she makes those decisions anyway.

Kansas City doesn’t suffer from a shortage of studies. It suffers from a shortage of elected officials willing to let evidence influence how they govern. After decades of subsidies and billions of taxpayer dollars committed, the chair of the Finance Committee says she still lacks the information needed to make an educated decision. That’s not an excuse. It’s an indictment.

If Andrea Bough truly lacks the information necessary to judge these projects, she should stop approving them until she has it—and resign from the positions that require her to oversee them. If she already has the information and simply chooses to ignore it, that’s worse.

Either way, the problem isn’t simply that she claims not to know whether billions in subsidies work. It’s the remarkable ease with which she continues approving them anyway. Kansas City deserves elected officials who treat billions of taxpayer dollars with more care than a shrug.