Kansas City, MO – Mayor Sly James today urged Congress to reject tax bill proposals that would slow economic growth, cripple the City’s ability to deliver critical infrastructure projects, and increase the financial burden of Kansas Citians.
“We need an agenda to revitalize and restore the infrastructure of our cities, not cripple future investment in our urban centers,” said Mayor James.
Currently, separate tax reform proposals are being considered in the U.S. House and Senate. There are troubling provisions in each of the bills that would hurt, rather than help, Kansas City. Most troubling are provisions to eliminate Private Activity Bonds (PAB) in the House bill and the repeal of Advanced Refunding Bonds in both the House and Senate bills. PABs are essential to a number of City infrastructure projects and expected to be a significant tool in financing the new KCI airport approved by voters earlier this month; elimination of PABs could throw the project’s future into question.
Also, over the last decade, Advanced Refunding has been used for a number of important Kansas City infrastructure priorities, including water and sewer, Liberty Memorial, Zoo, public safety, Music Hall, East Village, Downtown Arena, Plaza Garage, and Midtown Redevelopment projects. As a result of Advanced Refunding, the City has refinanced $580 million, saving taxpayers $52 million. Abolishing Advanced Refunding would make vital City projects more expensive and prevent some projects from moving forward. Provisions to eliminate the New Market and Historic tax credits will diminish the City’s ability to spur investment in low-income communities.
In addition, both the House and Senate bills would either partially or fully eliminate the state and local income, property and sales taxes deduction (SALT). This elimination would result in double taxation on Kansas Citians – increasing their tax burden and making it more difficult to own a home. SALT has been a cornerstone of our system for 100 years and is fundamental to how the City budgets and provides services to residents. Eliminating SALT and the increased tax burden on Kansas Citians could force the city to cut vital services in the future. Currently, 28 percent of households in the 5th congressional district could face a tax increase since these households use the SALT deduction for tax relief. The average SALT deduction in the 5th district is $8,622. In the 6th congressional district, 25 percent of households use SALT with an average SALT deduction of $8,657.
Mayor James also pressed Congress to reject attempts to use tax reform to undermine the Affordable Care Act (ACA), such as the Senate bill’s provision to repeal the individual mandate. The Mayor has continued to stress that any attempts to change the ACA should be in the interest of getting more people access to care, not less.
Mayor James underscored his support for comprehensive tax reform that spurs economic growth in Kansas City and communities across the nation but he will continue to oppose efforts to pass legislation that will increase the burden on cities and residents.