The Kansas City region’s economic development faced a unique challenge due to the state line dividing Missouri and Kansas.
Over time, this competition led to substantial tax breaks and incentives, often without significant regional benefits. Fortunately, a 2019 truce between the two states has since redirected efforts toward more productive, unified growth.
State-Line Competition
For years, Missouri and Kansas competed intensely to attract businesses across their borders, often offering massive tax incentives to secure corporate headquarters. However, this “race to the bottom” had little effect on regional job creation.
End of the State-Line War
In 2019, both states agreed to end their competitive incentives race. This agreement allowed regional leaders to focus on long-term economic development rather than temporary corporate relocations. This truce has been crucial in shifting attention toward genuine regional growth.
Economic Output Split Across Two States
A Brookings Metro study highlighted that the economic output of Kansas City is nearly equally divided between Missouri and Kansas.
This regional balance presents a unique opportunity to work together rather than engage in harmful competition.
Missouri and Kansas Focus on Regional Growth
With the end of state-line competition, both states have been able to focus on cultivating opportunities that benefit the entire Kansas City metro area.
Resources that were once used to lure businesses across borders are now dedicated to sustainable, region-wide development.
| Initiative | Year | Estimated Growth | Area Affected | Impact |
|---|---|---|---|---|
| State Truce Agreement | 2019 | Economic Cooperation | Missouri & Kansas | Positive |
| Business Relocation Incentives | Before 2019 | Little Growth | Kansas City | Negative |
| Regional Development Focus | Post-2019 | Substantial Increase | Kansas City Metro | Positive |
Conclusion
The truce between Missouri and Kansas in 2019 marked a turning point in Kansas City’s development strategy. Rather than competing for short-term corporate gains, the region is now working together to foster sustainable economic growth, benefiting both states and the metro area.
FAQs
How did Kansas City overcome its state-line economic development competition?
Kansas City ended its state-line competition with a 2019 truce between Missouri and Kansas, shifting focus from short-term corporate relocations to long-term regional development.
What was the impact of the 2019 agreement?
The agreement allowed both states to invest in regional growth, using resources to develop the Kansas City metro area instead of offering tax incentives for businesses to cross the state line.
How does the economic output of Kansas City split between the two states?
According to a Brookings Metro study, Kansas City’s economic output is almost evenly split between Missouri and Kansas, making cooperation between the states crucial for the region’s prosperity.
What is the future of Kansas City’s economic development?
With the end of state-line competition, the region focuses on sustainable development, leveraging both states’ resources to attract new businesses and foster community growth across the metro area.