Committee moves to clarify Schroder Field Airport property-tax exemption to avoid taxing local residents

The House Committee on Taxation held a hearing on Senate Bill 117, a narrowly targeted statutory clarification that expands property-tax exemption language for Schroder Field Airport.

Under current law the airport already has an exemption, but the bill would explicitly extend the exemption to property owned by the airport or its political subdivisions that is depicted on the federally approved airport layout plan, whether used for aviation purposes, to promote aviation commerce or to provide revenue to operate the airport. The reviser told the committee the bill "would clarify this exemption" and address drafting inconsistencies dating to earlier statute language.

Proponents described Schroder Field Airport as a long-standing federal-era asset turned local industrial-airport complex that generates large economic impacts for south-central Kansas. Mike Taylor, a proponent, told the committee the airport supports about 1,700 jobs and has a payroll near $190 million. Taylor said repeated appeals to the Board of Tax Appeals have confirmed that the airport property is exempt, but litigation costs have been substantial: "They've had to go to BOTA to appeal some of these cases. They've had to fight and it has cost them over $500,000 to fight these cases," Taylor said. Proponents said clarifying the statute again in code will avoid further litigation and protect local citizens from a potential new property-tax burden.

Kathleen Smith of the Department of Revenue told the committee the bill would reduce property-tax revenues to certain statewide levies and estimated a modest impact to state building funds: approximately $3,500 in fiscal year 2025. She also said the uniform mill levy interaction could require about $46,000 in additional state aid from the general fund to offset reduced local levies for school funding.

Winfield city officials and Arkansas City representatives said the change would keep Schroder Field Airport self-supporting and avoid imposing a new levy on their citizens. Randy Frazer, city manager of Arkansas City, said the airport currently operates without a local property-tax levy and that collecting taxes on airport property would place an "unnecessary financial strain" on both cities.

Committee members asked why the statutory language diverged from the original intent and whether an update to penalty dates in the bill was necessary. The reviser noted a technical date update was included in the bill language and that the bill restores the long-standing intent recorded when the airport was transferred to local ownership in the early 1990s.

The committee did not record a final vote during the hearing. Proponents noted the bill passed the Senate 39–1 and urged the committee to approve the statutory clarification to avoid continued litigation costs for the airport and the two cities that own it.