Readers of the AutoSlash blog know we’re not fans of fees, whether created by government agencies or the rental car companies themselves. It’s a common practice of cash-strapped governments and airport authorities to extensively tax individuals (air travelers) who are presumed to be tourists. Those funds are then frequently used for projects that wouldn’t be undertaken otherwise. And with that …
Kansas City, Kansas City here I Come – Fats Domino
One of the more egregious sets of fees assessed on rental cars happens to be in Kansas City, Missouri (KCMO). The Fee Detective lived outside the city for more than a year and knew there were issues with rental car pricing.
Just how bad are the fees at the local airport? In the Fiscal Year Ending 2016, Enterprise Holdings Inc. (Enterprise/National/Alamo) was the fourth largest source of revenue for the airport authority. The airport (MCI)* receives more revenue from Enterprise than American Airlines, which acquired hometown airline TWA’s assets. Even worse, many of the fees charged on a Kansas City rental are not included in the airport’s listed “take”, as much of the fee revenue is diverted elsewhere (like the “Downtown Arena”).
* Kansas City International is named MCI after the defunct Mid-Continent Airlines.
Rental cars for many business visitors to Kansas City are almost a necessity. The airport lacks a decent mass-transit option to a downtown that’s 20 miles away. At one time, there was a tax imposed to fund a light rail system (never built) from the airport to downtown. The closest option to “mass transit” are the 18 bus trips each day from the airport to downtown.
Missouri, “The Show-Me (the Money) State”
Everyone knows that a rental car company must make money. Everyone knows that the local municipalities are going to assess taxes. The Kansas City taxes are bad for short rentals, absurd on long rentals. Why? Most municipalities only charge special rental car fees for limited durations.
- Boston’s Convention Center Fee of $10 is charged once per month (whether a few hours or 31 days, that fee remains the same).
- New Jersey’s Domestic Security Fee of $5 per day is “only” collected on the first 28 days of a rental.
Kansas City imposes fees for every day of a rental. And Kansas City International Airport has a swarm of fees on rentals.
- The $3 Customer Facility Charge? That’s assessed for every day of the rental (and then taxed).
- The $2.36 Transportation Facility Charge? That’s assessed for every day of the rental (and then taxed).
- The Downtown Arena Fee of $4? That’s assessed for every day of the rental (and then taxed).
Let’s break that down a bit. The Customer Facility Charge and Transportation Facility Charge? The total is a mandatory $5.36 (plus tax) for every day the renter car user is not at the airport! It takes some A-grade government creativity to charge a use fee for every day a facility is not used*.
* AutoSlash just figured out how to save Amtrak and the U.S. Postal Service.
The Downtown Arena Fee was designed to pay for … well … the Downtown Arena. Rent a car at the airport, and the driver’s paying for the arena downtown. In a comparative rarity, this fee is also charged on downtown rentals. Usually, only airports are subject to this type of fee, as airport customers are viewed as tourists without votes. More on that in a bit.
Why We Can’t Have Cheap Rental Cars (Missouri Edition)
A lot of readers would assume no government’s stupid enough to assess more than $15 per day in rental car taxes. Well, Kansas City, Missouri has never found a tax it doesn’t like. As a prior resident of a county bordering Kansas City, I had to pay federal tax, state tax, county tax, car tax, and then more than $1,000 to Kansas City itself because my office was located in Kansas City. On an entirely unrelated note, Kansas City, Missouri officials express surprise when major businesses move their headquarters across the river to the State of Kansas …
Long-Term Rentals in Kansas City
We plugged in some random dates and ended up with a hypothetical 43-day long-term rental. We figured we would go with that total, as the number is important for fans of stock car racing.
The local government is very aware that perceived visitors are “cash cows”. Rent a long-term vehicle from the airport and you might pay $18.49 per day in taxes with National. In many other major cities, we often find all-inclusive rates less than the taxes alone in Kansas City.
Thought the taxes on the National rental were bad? This hypothetical Avis midsize for the same reservation period has taxes averaging $19.54 per day on a long-term rental.
A renter that’s able to Uber away from the airport will find that the downtown Avis location has lower rates and much more reasonable taxes at “just” $8.20 a day on a long-term rental (despite the misspelled Arena Fund).
About that Downtown Arena Fee ($4 a day plus tax) …
The elephant in the room with Kansas City rental car taxes is the Downtown Arena Fee. Fifteen years ago, downtown already had an arena, the Kemper Arena. The character Erin (Ellie Kemper) from The Office? The original arena (that still exists) was named after her family.
Some civic-minded folks in Kansas City decided that the city needed a new arena, which would largely be funded by rental car taxes. The awesome new arena was certain to bring an NBA or NHL team to Kansas City! Apparently, Field of Dreams (“If you build it, they will come”) was the inspiration for this idea!
Not to pile on, but the civic activists forgot a few things:
- Field of Dreams was a work of fiction,
- If Field of Dreams was non-fiction, an arena is not a field,
- There are larger cities without NBA or NHL teams, and
- Prospective tenants would (rightly) fear the creation of a Downtown Arena Occupant Tax.
Kansas City, Missouri decided to impose the $3.50 per day Downtown Arena tax on rental cars, built a new arena and kept the old arena …
Kansas City built it (Sprint Center), but “they” (professional sports team) didn’t come.
Introducing the Sprint Center!
The new arena (the Sprint* Center) opened a decade ago (2007) and a professional sports league has not come. A professional team at the facility would have helped cover the day-to-day operating costs …
Without the professional sports team, the original $3.50 per day Downtown Arena fee from the facility’s proposal has now become a $4.00 per day fee that appears in every rental car contract in Kansas City, Missouri (airport or neighborhood). That’s right! A visitor to Kansas City, Missouri who chooses to rent a car is paying for not one but two arenas, neither of which has a single full-time tenant. The last major recurring event at the old Kemper Arena – the annual American Royal Livestock Show – will soon be following other enterprises in the move from Missouri to Kansas.
In the process of chasing a professional sports team, Kansas City built a second arena and managed to lose the first arena’s major tenant. Unfortunately for consumers, those choosing to rent cars in the region will be on the hook for the city’s myriad mistakes for decades to come.
* Not to pile on, but Sprint is also headquartered across the river in Overland Park, Kansas
Fees, facility charges, and taxes got you confused and/or down? The Fee Detective can explain. Send your query to firstname.lastname@example.org and we'll feature your question in an upcoming post.