Legislators from both parties and all parts of the state are planning to introduce bills during the next session of the General Assembly to significantly curtail the use of eminent domain and tax increment financing. In an area such as downtown where developable tracts must be assembled by acquiring numerous small properties and construction costs are compounded by the neccessity of demolition, structured parking and high-rise engineering, both of these tools are essential to continued progress. In order to ensure that progress continues, the Kansas City community must unite behind efforts being led by Mayor Kay Barnes to defeat these proposals.

The furor over eminent domain arose in Missouri, as elsewhere, after the Supreme Court of the United States decided Kelo v. City of New London last spring. In this decision, the Supreme Court held it would not overturn a Connecticut law which allowed the acquisition of private property by the City of New London for the purpose of assembling a site for new economic development adjacent to an abandoned ship yard. While the court declined to find a federal constitutional basis for striking the Connecticut law, it emphasized that nothing in the decision prevented states from passing state legislation to restrict the use of eminent domain for economic development purposes.

In response to the Kelo decision, Missouri Governor Matt Blunt appointed a task force to recommend ways to limit the use of eminent domain for economic development in Missouri. In appointing the task force, Governor Blunt overlooked the fact that the Missouri Constitution only allows the use of eminent domain to acquire property for public uses and specifically prohibits condemnation for private purposes. Contrary to the Supreme Court's decision regarding federal law in Kelo, the Missouri Constitution specifically provides that the determination regarding, what is an appropriate public use is made by the courts. In other words, the Kelo case could not have arisen in Missouri.

The task force is focusing on procedural safeguards (such as prior notice to property owners and mandatory mediation). Its recommendations when delivered to the governor may not call for measures which unduly impair the ability of cities to handle urban redevelopment. Unfortunately, the report of the task force will not be the end of the matter.

Overlooking the fact that Kelo made absolutely no impact on the law of Missouri, and without waiting for the governor's task force to report, members of both the Missouri Senate and the House of Representatives have called for the elimination of eminent domain for economic development purposes and, in the case of the rural Democratic caucus, the total elimination of eminent domain. Without the ability to condemn property for highway construction, public schools and public utility extension, not only economic development in cities but maintenance of public infrastructure will become impossible in the State of Missouri.

From the point of view of downtown, any impediment to the use of eminent domain to acquire tracts for redevelopment will stem the momentum which has been developed over the past five years. Without the availability of eminent domain to the city, one reluctant property owner could have prevented the H&R Block Building, the Sprint Arena or Quality Hill from happening. With much of the east side of downtown still to be developed, the threat of unwise state legislation concerning the use of eminent domain is more than hypothetical. If any one of several proposals being advanced by influential legislators with support from the powerful Missouri Farm Bureau becomes law, redevelopment in downtown Kansas City will become a memory.

Just as cries for elimination of eminent domain have reached a fever pitch, the recurring drum beat of proposals to curtail tax increment financing has been renewed by legislators from St. Louis County and out-state Missouri, joined by a handful of Kansas City-area representatives and at least one senator. With the support of some school districts, these legislators are calling for tax increment financing 'reform' which would exclude the use of TIF for retail projects, residential development and greatly curtail the definition of 'blight' within the statute. Although TIF-reform bills have been introduced in every session of the General Assembly since the last major overhaul of tax increment financing in 1997, this year's crop of proposals is receiving more support than similar measures advanced in the recent past.

When these proposals are reviewed in light of past and present uses of tax increment financing in downtown Kansas City, they constitute a threat to the momentum of development equal to the eminent comain hysteria. Abolishing the use of tax increment financing for retail projects would have prevented the entertainment district and will prevent other restaurant, entertainment and retail development in the city as well as the suburbs (consequently eliminating suburban projects which shore up the Missouri tax base and prevent the out-migration of retail sales to Kansas, such as Summit Woods in Lee's Summit and the Bass Pro project in Independence).

Eliminating the use of tax increment financing for residential projects would kill the conversion of obsolete downtown offices, such as the old federal office building at 909 Walnut, to apartments and condominiums. Most observers agree one of the keys to progress in the revitalization of downtown has been the significant increase in residents coming to lofts, apartments and condos in and near downtown. Eliminating downtown residential development would consequently have a scondary negative impact on retail and entertainment redevelopment.

In addition to impacting on downtown, the elimination of the use of tax increment financing for residential purposes would have prevented approval of the 18th and Vine TIF plan and several infrastructure generating TIF projects north of the river in Kansas City. Elsewhere in the metro area, developments such as Stone Canyon which is turning two capped landfills into a Greg Norman-designed golf course and anchor for future development in eastern Independence, would not be possible.

Finally, greatly limiting the definition of property which is considered blighted under the tax increment financing statute will create tremendous confusion by changing a definition that has been on the statute books since the passage of the Land Clearance for Redevelopment Act in the 1950's. The history of the use and judicial interpretation of the concept of blight in Missouri makes it possible to assess the appropriateness and viability of proposed projects. Changing the definition will be an invitation to litigation which will curtail development downtown as well as elsewhere on the Missouri side of the state line.

Now is the time for the community to come together and express its support for TIF and eminent domain to members of the Missouri General Assembly. Without these tools, the City of Kansas City will be virtually defenseless in competition across the state line and with other communities throughout the United States. While our neighbors in Kansas utilize a wide variety of economic development tools to attract Missouri business across the state line, including tax increment financing, new jobs cash incentives and STAR bonds, TIF and eminent domain are pretty much all we have to work with to keep businesses, jobs and tax base from leaving. We need to protect the redevelopment momentum we have achieved by protecting the economic development tools that fueled that momentum.