Manhattan is putting additional economic development funding for new Manhattan Area Chamber of Commerce and Region Reimagined initatives on hold until after the November election.
The City Commission rejected a motion to provide the Chamber an additional $350,000 per year in economic development money for 5 years by 3 to 2 vote, and will revisit the proposal after they know the results of the sales tax ballot question. Mayor Mike Dodson and Commissioner Linda Morse voted in favor of the initial proposal.
“We the city and the community have put a lot into Region Reimagined,” says Morse. “It’s been a year in the making and [nine months]since we’ve kicked it off, more or less, and we’re assembling the staff, assembling the resources.”
Commissioner Wynn Butler wanted to see more metrics on how city investment’s improves sales tax receipts and property tax revenue, saying the benefit doesn’t translate to the average citizen. Butler proposed giving them the funding for a shorter time frame rather than five years.
“Maybe a year and say come back and demonstrate that you actually did what you said you were going to do,” says Butler. “Five years is to me just too long a period.”
The total impact of the additional investment over 5 years would be $1.75 million, drawn from the city’s sales tax funded economic development fund — which has an uncommitted balance of more than $6 million. The money is intended for use in plans and strategies that include marketing Manhattan to new employees and employers, retaining businesses already in Manhattan and supporting their expansion, and increasing the number of Kansas State University graduates and Fort Riley soldiers who choose to stay in the area. Additionally, they aim to create at least 500 new jobs and draw $50 million in private investments by the end of 2023 with a “stretch goal” of 1,000 new jobs in that period.
Mayor Pro Tempore Usha Reddi says she wants to be cautious moving forward, as they may need the economic development fund balance for other projects if the 0.3 percent sales tax ballot question is not approved by the community.
“When we have the levee for $10 million, North Campus Corridor coming up, Aggieville development — all of these things that are coming up, I just want to [press]pause for maybe a month and revisit,” says Reddi.
Mayor Mike Dodson says with or without the sales tax, this investment needs to happen. He adds that cities like Topeka that invest $2.5 million in their economic development initiatives and Advantage Manhattan, which has drawn $3 million in private investment for economic development initiatives through 2021, wouldn’t commit funds at that level for no benefit.
“If we don’t do it, we’re going to sit right where we are right now,” says Dodson. “As either a private citizen or a company, if you don’t make investment you’re not going to do well in the long run. Doesn’t mean there isn’t any risk, I mean that’s why we do these kind of things.”
Manhattan currently provides the Chamber with $147,000 per year and Riley County provides $50,000. Private sources invest $650,000 per year. Using the city’s formula for calculating economic impact, Chamber President and CEO Jason Smith says since 2002 their efforts have created more than 2,300 jobs that earn more than $48,000 — and garnered $9 million per year to local governments through taxes.
Comissioner Jerred McKee says he doesn’t oppose funding economic development, but feels the process has gone too slow and that after two years they still don’t have much to show from Region Reimagined.
“If you came back and said ‘let’s fund a start-up center, we think this would be a great idea and here’s why,’ those are things that I want to do and get excited about,” says McKee. “This seems to me just to have a little bit of a flavor of a few plans that are going to sit on a shelf and get dusty and that’s why I get a little bit hesitant about it.”
Chamber President and CEO Jason Smith agreed they should be more aggressive, but noted the Chamber went through a major change with the retirement of Lyle Butler and he’s just 6 months into the position.
“In my history in other places I can show you where we’ve done those things, but it’s hard to move forward with uncertainty about resources,” says Smith.
Commissioners unanimously voted to bring the same proposal back for consideration at the first meeting following the November election.
