In a powerful series of statements and research findings, the leadership of the Kansas City Public Schools system has denounced economic development tax incentives for their “systemic racism.” Citing new data made possible by GASB Statement 77 on Tax Abatement Disclosures, the School District is advocating for reforms to give the school board power to protect its revenue base.
It began with a searing public statement in late June by KCPS Superintendent Dr. Mark T. Bedell. He said, in part:
Frankly, I am exhausted with the development community pitting the City against the public entities that are doing the work of trying to give our students and their families access to the world they deserve. This is systemic racism.
Then Wednesday, KCPS released powerful data supporting that charge: In its own schools where more than 80% of the students are Black or Latino, the schools lost more than $2,000 per child to tax abatements in 2018. In a suburban school district Park Hill, where almost 70% of students are white, schools lost only $97 per child.
Groups like the Coalition for Kansas City Economic Development Reform spoke out in support of the proposed changes. “The time is now to fix the economic divide,” said a Coalition leader.
“Kansas City has long been a cauldron of bipartisan debate over subsidy abuse,” said Greg LeRoy, executive director of Good Jobs First, “and so have St. Louis and other Missouri communities. Tax increment financing (TIF) is an especially rampant problem in Missouri, and it is because the state has repeatedly failed to act that localities like Kansas City are being forced to protect themselves.
“These new disclosures made possible by GASB Statement 77 on Tax Abatement Disclosures should be utilized by every school board, every PTA, every education advocate, and every mayor, governor and legislator in America,” LeRoy urged. “Finally, we are getting a more honest accounting of corporate tax breaks and the harm they cause public services. We have long suspected that those harms are grossly unequal, and that they fuel racialized inequality. The Kansas City data confirms that.
“With budget crises everywhere due to the COVID-19 pandemic, every tax dollar is precious,” LeRoy concluded. “We have urgent priorities, and everyone must exercise their right to know the real costs of corporate giveaways.”
Good Jobs First has been acknowledged for its leadership role in organizing the national campaign to win the adoption of GASB Statement 77 in 2015, and we have promoted the use of this new data since it started flowing in 2018. We have already revealed, in a survey of states with trustworthy compliance, that schools in half the states lost at least $1.8 billion per year to corporate tax breaks. We are now updating that study, The New Math on School Finance.