Finance Department | City Controller | Development Finance | Revenue | Treasury | City Tax Forms
Dan Bagunu, Manager of Development Finance
City Hall, third floor
414 E 12th st
Kansas City, MO 64106
816-513-1033
Email : Dan_Bagunu@kcmo.org
Development Finance
Development Finance is involved on the front end and back end of every tax-incented development in
Kansas City, from the idea stage through its lifetime. The division’s strategic goal is to provide an overall development framework that promotes sustainable economic development. Primary objectives include:
- Implement the City's Economic Development & Incentive Policy,
- Make recommendations that govern the award, use and measures of economic incentives,
- Participate and lead the financial discussions throughout the development process,
- Determine optimal public/private financing structures that minimize the financial risk and impact to the City and other taxing jurisdictions, and
- Ensure proper accounting and compliance for all projects approved for tax incentives
The division analyzes specific development proposals at a rate of 50 to 75 per year. Each development project proposal goes through a rigorous due diligence process that evaluates the developer's projections, financing gap (specifically the benefit of the requested incentive to the project's financing structure and pro-forma), the incentive's potential fiscal impact to the City, as well as the development project proposal's attention to the Economic Development & Incentive Policy. Currently, there are over 50 Tax Increment Financing (TIF) plans that include over 1,000 businesses and there are over 700 tax abated projects/parcels. Each of these plans/projects require ongoing, careful measuring and accounting for taxes that must be collected and redirected.
The City’s economic development toolbox contains a wide array of
incentives to encourage economic development which fall into four general categories:
- Those that forego future tax base which include Ch. 100, Land Clearance for Redevelopment Authority, Urban Enterprise Zone, RSMO 353 and Planned Industrial Expansion Authority tax abatements;
- Those that redirect future tax base which include TIF, Super-TIF and Council Initiatives;
- Those that use the City’s credit strength to improve the marketability of an individual project to investors through an annual appropriation guarantee of future debt service;
- Those that provide self-supporting mechanisms for development which include Community Improvement Districts, Neighborhood Improvement Districts, Transportation Development Districts.
Additionally, the division promotes the use of other federal, state and local incentives, specifically New Markets Tax Credits (NMTC). Through a partnership with Central Bank of Kansas City, Mo, the division is leading the City’s effort to assist Central Bank in the direction of NMTC to underserved communities for eligible projects that spur economic development in the City’s highly distressed areas.
The use of each incentive requires front end analysis to include:
- Real and personal property valuation
- Tax projections
- Real and personal property
- Economic activity (earnings, sales, convention and tourism, utility, etc.)
- Project pro-forma and financing analysis
- Fiscal impact analysis
- Development of financing/cooperative/development agreements
- Coordination with other entities (city departments, development organizations, taxing jurisdictions, etc.)
The use of each incentive also requires back end administration and monitoring to include:
- Collection of taxes (real property and economic activity)
- Redirection of taxes (real property and economic activity)
- Coordination with other entities (city departments, development organizations, taxing jurisdictions, etc.)
- Monitoring of annual reports (RSMO 353, Ch. 100, etc.)
- Execution of developed agreements
The division is dedicated to the continued improvement and enhancement of the economic development process to provide fiscal leadership that promotes long term financial health. To attain that end result, the division works with the
City Planning and Development Department and the
Economic Development Corp.
