Destructive economic and social policies in Kansas compelled Pathfinder Health Innovations’ move to the Show Me State, its founder wrote in a blog post critical of state leaders.
A tech service provider for people with autism, Pathfinder received tax incentives for its border hop to Missouri but Pathfinder CEO Jeff Blackwood said the move also was a statement. Blackwood cited the effects of the legislature’s slashing of income taxes in 2012 and 2013 — which have wreaked havoc on the state’s finances — as a primary factor for the move.
“There’s a motivation of conscience that factors into it,” Blackwood wrote, adding that his views do not reflect those of his firm, employees or investors. “It’s not so much that I’m moving the company to Missouri as I’m moving it away from Kansas.”
Brownback and lawmakers’ tax policies aimed to spur business growth and attract new firms to the state. Ironically, the opposite has occurred with Pathfinder, as Blackwood said Kansas lawmakers’ harmful policies have targeted those his firm serves: educators and people with developmental disabilities.
Under Brownback, annual state aid per pupil has dropped from $4,400 in 2011 to $3,800 in 2016, according to the Kansas branch of the National Education Association. The governor also in 2011 closed the Lawrence office for Kansas Social & Rehabilitation Services. Brownback in 2013 also championed the privatization of the state’s Medicaid program, KanCare, whose recipients have since complained about long wait times and frequent reimbursement denials.
What’s more, Kansas faces a massive budget shortfall of more than $600 million. In May alone, tax collections were $74.5 million short of expectations — a 13.7 percent shortfall.
Brownback has not yet responded for comment on this story.
“It is far past the time that Sam Brownback and his cronies admit the damage they’ve caused to the people of Kansas and resign in the shame they deserve.” – Jeff Blackwood
Blackwood said that the policies morally obliged him to move his company — and its state tax revenue — to Missouri.
“The worst part is that the burdens for the shortfalls rest on the shoulders of those who can least afford it — children and the developmentally disabled,” Blackwood said. “I can’t, in good conscience, continue to give our tax money to a government that actively works against the needs of its citizens; a state that is systematically targeting the citizens in most need, denying them critical care and reducing their cost of life as if they’re simply a tax burden that should be ignored.”
Despite the political climate, Blackwood said Pathfinder has significantly grown since its 2010 founding date.
In 2016, Pathfinder has grown revenue by 40 percent, Blackwood said. The health firm has raised $3.2 million in capital and now has 23 employees. It also in March acquired Phoenix-based Ensure Billing, a move that beefed up the company’s services, employee headcount and increased its client base by 57 percent — from 80 to 140 clients.
The successes mean that Pathfinder has outgrown its Overland Park office. The firm will be moving to the East Crossroads Arts District, an area of Kansas City with which the firm will have an apt culture fit, Blackwood said. Pathfinder could be eligible to receive up to $370,000 in tax incentives if it creates 21 new jobs in Missouri, a spokeswoman with the Missouri Department of Economic Development confirmed.
Blackwood acknowledged that his firm’s move is “a drop in the bucket” for Kansas’ revenue, but that he wanted to send a message to businesses and residents of the Sunflower State.
“I believe that it is the responsibility of business owners and people with some voice in society should speak up against these destructive policies,” Blackwood said. “And I believe it is far past the time that Sam Brownback and his cronies admit the damage they’ve caused to the people of Kansas and resign in the shame they deserve.”