The but-for test: a rule Topeka made up, then exempted itself from
No Kansas law requires a but-for test. Not for TIF, not for CID, not for RHID. Topeka invented it, in RHID Resolution 9627 and its TIF policy, complete with a 7.5% cap on what a private developer is allowed to earn.
And who's exempt? The city. GO Topeka. The people who wrote it.
So if you own land in this town, you pay Columbia Capital's Jeff White to prove your project wouldn't happen "but for" the incentive. The state's own auditors call that question "inherently unknowable." You pay for an answer nobody can give, while City Hall takes its own deals straight to the finish line.
Here's what it looks like when the city runs the deal:
- Hotel Topeka: $18.35 million spent, and a $7.6 million bid on a property appraised at $3 million. REV-PAR International billed about $554,000 to manage it, Schwerdt Design got $157,680 to inspect it, and REV-PAR's own model showed a 17- to 19-year payback. It sold for $1 million.
- 220 SE 6th (the old AT&T building): a $1.5 million purchase, about $9.4 million in public money, and $63,000 a year in place of about $298,000 in taxes.
- Gordon Center: two bankruptcies, and a traffic study that wasn't allowed to look at the site's history. I worked for that developer, and it cost about $1.7 million more than it should have. I stand behind that number.
So who benefits from a test the city won't take itself? It isn't the taxpayer, and it isn't the developer. It's the consultants paid to run it.
The good news is that this takes one council vote. No lawsuit, and no legislature. I've asked the council to suspend the test, then retire it or apply it to everyone, and to publish every dollar paid to Columbia Capital for this analysis.
The council just voted 9-0 to let voters decide on an independent auditor. Good. Now let's apply the same standard to the but-for test.
Henry McClure, (762) 291-2765
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