Financial Adviser
Let's Hang Together



It was Benjamin Franklin who first uttered the often quoted admonition: "We must all hang together, or assuredly we shall all hang separately." In the context of the lives, fortunes and sacred honor of our founding fathers during the struggle for Independence, the significance of the warning was grave indeed. The same sentiments have been expressed in other instances where internal differences among similarly situated individuals and institutions were less important to the well-being of all concerned than share interests in larger issues. The common interests of communities on both sides of the state line in the Kansas City metropolitan area should far outweigh differences within the area. We share one economy, one set of cultural and recreational institutions, and one overall position in the national competition for economic development and community expansion. As separate cities and counties on both sides of the state line squabble over where new retailers or manufacturers locate facilities, little innovate consideration has been given to our common destiny on the national scene.

In 1950, Kansas City was the largest metropolitan area between the Mississippi River and the Pacific Coast --overshadowing such present-day success stories as Minneapolis, Denver, Phoenix and Dallas. In 1976, the year we hosted the Republican National Convention, Kansas City ranked third as a convention destination city. We now are out of the top twenty. Names such as Marion Laboratories, TWA, Gleaner, Unitog and Sealrite, all at one time headquartered in the metro area, are no longer part of our economic base. A case can be made for the argument that Kansas Citians have more important issues to consider than whether Bass Pro locates its new store in Olathe or Independence.

At least some of the frustration Kansas City has experienced in the past half-century is caused by the state line and our inability to develop effective regional responses to challenges from other cities. Innovative regional initiatives, such as those which ensured mass transit in St. Louis, a downtown convention center hotel in Minneapolis and the renovation of downtown Indianapolis as a national sports center, are difficult to plan and accomplish in Kansas City. Unlike our competitors, we have to involve two governors, two legislatures, multiple counties and more mayors and city councils than any reasonable person would attempt to bring together on any major matter of area-wide public policy.

A model for solving at least some of Kansas City's regional problems was developed several years ago (following an initial recommendation from Kansas City Consensus) when the legislatures of Kansas and Missouri and the voters of four counties in two states approved the bi-state cultural tax. The political process was long and difficult, but the results speak for themselves--a renovated Union Station (undeniably a regional institution) and continuing authority to approve future taxes for other shared cultural goals.

The approach represented by the bi-state cultural tax (and earlier by the interstate compact authorizing the ATA), can serve to bring together the metropolitan area to tackle other more complex problems. The use of interstate compacts to create regional authorities and authorize the pooling of tax revenues across state lines can work on a scale much beyond renovating Union Station or subsidizing performing arts (important as those objectives are). Properly drafted, a comprehensive legislative proposal could allow a metropolitan area-wide tax to be focused on infrastructure, transportation, public safety or any other major metropolitan objective. To truly integrate Kansas City's vision of the future, all of the major regional problems should be addressed with a bi-state approach.

The area-wide tax base being available to solve regional problems vastly increases the amount of revenue which can be brought to bear on critical problems without endangering funds required for basic services in any individual city. While it might not make sense for Overland Park to construct a new interchange on I-35 to attract a regional corporate headquarters if such an undertaking would eliminate badly needed local street maintenance, a very low tax on a regional basis could pay the cost and save the project. Other communities contributing to such an undertaking would do so with assurance that the next project of regional significance might be in their corporate limits, and with knowledge that a portion of the new taxes generated by the development would be spent on other regional projects which would help the entire metropolitan area.

At a time when Jefferson City and Topeka are less than responsive to urban concerns, requesting taxing authority for local governments, and a compact governing how elected officials from cities and counties on both sides of the state line would administer the funds, should appeal to economy-minded members of legislative bodies in both states. The process of developing a consensus on priority projects before pursuing legislation, and determining how funds are actually spent after implementation, will create a dialogue which will bring the entire metro- politan area closer together even without benefit of new tax revenue. The availability of new regional tax funds will put Kansas City in a position to compete with our single-state adversaries for major economic development opportunities in the future.


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