The Chanute City Commission on Monday discussed the future of local economic development efforts, debated funding options for the Chanute Regional Development Authority, and approved a new electric rate structure aimed at protecting residents from potential costs associated with high-load industrial users such as data centers.
Commissioners held a general discussion about the CRDA’s role following the failure of a proposed sales tax that would have supported the organization. Commissioners agreed to schedule a March 9 work session to further examine funding scenarios and clarify the city’s long-term economic development strategy.
Much of the conversation centered on whether economic development should remain the responsibility of an outside agency or be more directly managed by the city government.
Commissioner Tim Fairchild said economic development historically has involved multiple community partners, including USD 413, the local chamber of commerce, Main Street, and the CRDA.
See COMMISSION, continued on page 3 He noted past efforts, including a committee structure supported by a dedicated sales tax, ultimately dissolved due to a lack of sustained support.
Mayor Jacob LaRue raised questions about accountability and performance metrics, suggesting that any funding agreement should include measurable goals such as job creation or housing development targets.
City Manager Todd Newman expressed concern about funding challenges, particularly in light of the defeated sales tax and the city’s existing financial obligations. He cited major infrastructure investments, including the city’s water plant and wastewater projects, and said the city must remain mindful of debt levels and utility rate impacts on residents.
Newman said he prefers the CRDA remain an outside agency, describing economic development funding decisions as inherently political. He said options such as a mill levy or renewed sales tax would require careful consideration, especially given voters’ recent rejection of additional funding.
Commissioner Larry Taylor said the city has historically played a significant role in economic development, but acknowledged uncertainty about the best path forward. Commissioners did not take formal action on the CRDA but indicated consensus to continue discussions at a future work session.
The commission also approved an ordinance establishing a new electric rate classification for high-load industrial customers. City Attorney David Brake said the measure is designed to ensure that large-scale users — including potential data centers — bear the full cost of infrastructure upgrades needed to serve them.
Brake said the rate would apply to customers with demand starting at 2 megawatts and would include a demand charge structure to prevent existing residential and commercial customers from subsidizing major new loads. Commissioners emphasized the ordinance does not approve any specific data center project but positions the city to respond if approached.
Neighboring communities, including Iola, have recently considered or approved data center proposals, and officials said such developments are increasingly common nationwide.
Commissioners unanimously approved the rate ordinance.
In another action, the commission approved a state-related financial compliance matter that officials said will allow the city to remove Revolving loan funds from its audit following approval from the Kansas Department of Commerce.
In Commissioner comments, Commissioner Tim Harding thanked the community and volunteers for Operation Soupline.
LaRue thanked city staff for their response to a recent power outage, saying communication was timely and no injuries or major losses were reported.
