About two weeks after filing it, the Unified Government of Wyandotte County/Kansas City, Kansas, dismissed its lawsuit challenging Kansas’ Chiefs stadium law following an agreement addressing local control, utilities and the boundaries of its financial commitment.
The agreement preserves local planning and zoning authority over development surrounding the proposed stadium. The stadium and parking areas, however, will be state-owned facilities outside local zoning and building-code requirements.
For residents concerned about how much local revenue will support the project, another provision matters: the local tax pledge remains confined to approximately 235 acres encompassing the stadium, parking and associated development—not all of Kansas City, Kansas, or Wyandotte County.
What Local Government Previously Pledged
In February, commissioners voted 7–3 to commit specified sales, use and hotel taxes generated within the project area toward repayment of state-issued Sales Tax and Revenue, or STAR, bonds.
The ordinance pledges:
- All revenue from the city’s 1% general sales and use tax not otherwise committed by voters, collected within the project area.
- The UG’s 93.1733% share of the county’s 1% general sales and use tax not otherwise committed by voters, collected within that area.
- Revenue from eight percentage points of KCK’s hotel guest tax on stays within the project area, subject to the state’s administrative deduction.
KCK’s hotel guest-tax rate is currently 10%, leaving two percentage points temporary tax outside the pledge that is set to expire Dec. 31, 2028. The rate will return to 8% unless the UG commission acts to extend it. The hotel tax itself and the stadium pledge do not expire then.
The pledged package lasts up to 30 years and ends when the covered bonds, including refinancing bonds, are repaid. Its starting revenue base is zero, meaning revenue from the specified taxes within the project area is pledged from the beginning.
The ordinance excludes the 0.25% emergency medical services sales tax, the 0.375% public safety and neighborhood infrastructure tax, other voter-dedicated taxes and specified special-district revenues. Local revenues generated outside the designated area are also excluded.
Two Districts, Different Revenue Commitments
The local pledge area is separate from the much larger state STAR bond district, which includes portions of several cities in Wyandotte and Johnson counties.
Within that larger district, Kansas is pledging growth in specified state sales-tax revenue toward the Chiefs project. The state district’s boundaries do not automatically commit local sales taxes from those communities.
That distinction creates a potential benefit for KCK: additional shopping, dining, property taxes and other taxable activity outside the approximately 235-acre local pledge area could produce considerable local revenue that is not committed under this stadium pledge.
Inside the project area, the entertainment development is included in the local pledge of sales-tax and hotel-tax revenue. Keeping local zoning authority over that development did not exempt it from the tax pledge.
What the Lawsuit Agreement Adds
The Oct. 23 announcement by Gov. Laura Kelly and Mayor Christal Watson outlines a division of authority and utility responsibilities:
- Surrounding development: Local planning, zoning and BPU payment-in-lieu-of-taxes requirements remain applicable.
- Stadium and parking: The Kansas Sports Facilities Authority will own these facilities and lease them to the Chiefs for $7 million annually.
- Stadium electricity: BPU and Evergy will develop a partnership.
- Stadium water: BPU will provide service.
- Wastewater and stormwater: The Unified Government will provide service.
- Surrounding utilities: BPU and the UG remain the exclusive providers.
“The collaboration in recent days has literally been a game changer,” Watson said in the joint announcement.
The agreement keeps the local tax pledge confined to the stadium, parking and associated development area. It does not explain how BPU and Evergy will divide electricity-service responsibilities or revenues.
Taxes That Still Support Local Services
Even inside the project area, some sales taxes will remain available for their designated local purposes.
The excluded EMS and public safety and neighborhood infrastructure taxes would still be collected on applicable taxable purchases inside the stadium and surrounding development. Their revenue would support those services rather than stadium bond repayment.
Together, those taxes total 0.625%, generating $625,000 for every additional $100 million in taxable sales. Increased visitor spending could significantly strengthen those collections, although the net gain would depend partly on how much spending is new rather than shifted from existing KCK businesses.
Two additional sales taxes on the Nov. 3 ballot could provide another source of local revenue if approved:
- A 0.25% countywide tax for health services, including indigent care, behavioral health, substance-use services, preventive care and the county health department.
- A 0.375% KCK city tax for parks and infrastructure, including community centers, trails, roads, bridges and sidewalks.
Because the stadium pledge excludes taxes dedicated to other purposes by voters, these proposed taxes would also fall outside the pledge if approved. Applicable purchases within the stadium project area would help support those voter-approved purposes.
Where Other Local Benefits Could Come From
The financial case for the project also includes hotel-tax revenue KCK retains, property taxes on taxable surrounding development and other revenue associated with increased activity.
The stadium itself is expected to be property-tax exempt because of state ownership. Privately owned surrounding development could add taxable property, subject to any separate incentives or exemptions.
Outside the approximately 235-acre local pledge area, additional business activity could produce local sales-tax revenue that remains available locally. New development could also expand the property-tax base, potentially helping fund services and reducing pressure for property-tax increases.
A February analysis projected a net fiscal benefit of approximately $92 million over 25 years, after estimated public costs. That averages about $3.7 million annually, although actual costs and revenues would arrive unevenly.
The forecast already included unpledged sales taxes, property taxes from surrounding development and other revenues. Those benefits should not be counted again on top of the $92 million. Growth beyond the forecast’s assumptions could improve the outcome, while an updated analysis would be needed to determine how the proposed new taxes might affect it.
Details Still Being Finalized
The lawsuit’s dismissal does not mean every agreement has been completed.
The Beacon reported Oct. 29 that the UG dismissed the case without prejudice, allowing it to be brought again, while officials continued finalizing their agreement in principle. The UG may also revisit conditions attached to its original tax pledge, including protections concerning infrastructure funding and local participation.
The original financial analysis included $275 million in upfront infrastructure costs, but who will pay remains unresolved. The UG sought to have stadium infrastructure covered by STAR bonds.
If those costs are absorbed into the project’s financing rather than paid locally, KCK and Wyandotte County could receive a substantially greater net financial benefit than the earlier projection of $92 million over 25 years.
