Barbecue baron Ollie Gates has a plan to save a slice of Kansas City
Ollie Gates takes command of the room with a brief discussion about How Things Were.
He’s at a recent daylong symposium convened by Kansas City Mayor Mark Funkhouser to talk about bringing economic development to the urban core. The place is a sun-soaked conference room on the top floor of the Central Library. The time is after lunch, when a less arresting presence than a 6-foot-3 barbecue impresario might put the politicians, academics and business leaders to sleep.
Gates, the president of Gates Bar-B-Q, who turns 77 next month, begins by talking about what the city’s East Side was like before 1950. Slave descendants, he says, built a city within a city. “Twenty blocks of black,” they called it. “Our social life, our educational lives and churches and health facilities and professional facilities were all in this area,” Gates says.
The room is quiet as Gates speaks. Seated at a conference table, he seems to loom larger than anyone in the room — including the mayor, who bends over through doorways.
Gates leads his audience on an imaginary tour of the old neighborhood; describing cab stands; drugstores and the corner where G. Lawrence Blankinship Sr., one of the first African-Americans to serve on the City Council, sold Ebony magazine from a sack. Did you know that Arthur Bryant was a mechanic? Charlie, his brother, was the original barbecue man in the family.
At the center of all this was Vine Street, a thoroughfare so synonymous with black life in Kansas City that its name changes to Wayne once it crosses south of 28th Street. “That’s where the white community started,” Gates will explain later.
For an entrepreneur like Gates, the history of black commerce takes on special significance. In his view, social progress came at a cost to black businesses. “Segregation was the economic engine that propelled business in the area.”
The end of Jim Crow integrated neighborhood schools and allowed blacks to explore Swope Park beyond Shelter House No. 5. It also meant that African-Americans could spend their money where they chose. And they did, causing black and white businesses alike to flee the East Side. Gates describes the outward migration as “a big whooshing sound.”
“Segregation was the culprit that caused the good, the bad and the ugly,” he continues. “That’s why we’re here today.”
Gates belongs to the Intra Urban Economic Council, a group that has come up with an idea to revitalize an area where other programs have failed. The proposal is simple: Eliminate state and local taxes on goods and services in the area from Ninth to 29th streets, Troost to Prospect.
Removing the 7.725-percent sales tax, the group hopes, will increase the buying power of residents and attract merchants to empty storefronts.
“We’re promoting an incentive package to level the playing field,” says Chester Thompson, the president of the Black Economic Union, after Gates’ presentation.
Funkhouser and the City Council support the concept of what Gates and Thompson are calling the Black Heritage District.
The city isn’t the only government to rely on sales tax, however. The tax-free district would also need to be approved by Jackson County and Missouri legislators. The task is daunting. Bringing economic development to Kansas City’s distressed East Side isn’t necessarily at the top of the agenda for state lawmakers from the Ozarks.
But it’s hard to bet against a man with a brand for a last name.
At the corner of 27th Street and Troost, even the liquor store has gone out of business.
Gates is standing in weeds up to his kneecaps. The mayor has called a May 15 press conference to announce the city’s commitment to the Black Heritage District. A podium has been set up in the parking lot of the B&C Party Shoppe, a former 7-Eleven that neighborhood leaders complained was a source of blight because of the volume of gin and beer it sold. The B&C Party Shoppe is gone now, as is the China Kitchen (“$2.99 carryout”) on the other side of 27th Street.
Along with Thompson, Gates is standing with Black Chamber of Commerce Executive Director A. Marie Young and others who have worked on the proposal to eliminate sales taxes on the East Side. Almost half the City Council is here, too.
Before Funkhouser speaks, his staff circulates a resolution stating the city’s intent to take “any and all” measures to make the Black Heritage District a duty-free zone. Funkhouser says he was won over by a presentation made by the Intra Urban Economic Council at City Hall. Young calls the council, which meets every Tuesday, “the reality team.”
Funkhouser then introduces Gates, who thanks the mayor for his leadership. As police sirens wail in the distance, Gates describes the merits of the proposal.
He calls the duty-free concept “an inverted TIF.” Tax-increment financing is a widely used development tool in Kansas City. It allowed public money to help with the construction of the Power & Light District, the Plaza Library and a Wal-Mart on the site of the old Blue Ridge Mall, among many other projects. Gates’ TIF comparison is appropriate. A portion of sales taxes collected in TIF areas is returned to developers. The Black Heritage District essentially cuts out the middle man and puts the money in the consumer’s pocket.
Evoking TIF also serves as a reminder of how ineffective it has been at improving disadvantaged parts of Kansas City. Pliant city officials have allowed developers to use TIF around the Plaza and in the Northland, but backing projects in prosperous areas has removed the incentive to invest in truly needy parts of town.
In addition to taking TIF back to its original, blight-fighting intent, the duty-free zone is elegant in its simplicity. The proposal isn’t something that takes “a double-headed Philadelphia lawyer to conceive how it’s going to work,” Gates tells The Pitch.
“What we’re asking for is an inverted TIF, but without all the uglies that go with the TIF. We’re not asking for a developer’s fee. We’re not asking for bonds. We’re not asking for bond fees. We’re not asking for a lawyer’s fee. We’re not asking for any of that. We’re only asking to eliminate the sales-tax portion for the people who’re going to shop there.”
The proposal doesn’t look like much of a financial gamble.
According to the reality team, businesses within the Black Heritage District produced a mere $608,137 in city sales-tax revenue in 2006. Over the years, the 1,000-acre area has lost people as well as merchants; a population of more than 25,000 in 1960 is now closer to 5,000.
Gates believes that lost sales-tax revenues can be recovered with increases in property and income taxes that will follow the change. “Everything will go up. So it will probably be a wash between what you think you’re going to lose and what you gain, and it will probably be some advantage.”
At the press conference, Gates says the Black Heritage District will give opportunity to people who can’t afford the expenses involved in securing the aid of the city’s development agencies. “You can come in with $150 and open up a store across the street,” he says.
A reporter asks whether the project will relocate more businesses than it creates.
“We’ve been shuffling [businesses] all around Kansas City, from Westport to downtown, from the east to west,” Gates responds. “It don’t make no difference. If they shuffled out of this area, they can shuffle back.”
A man accustomed to being the boss, Gates tends to cut off people before they’ve finished speaking. A television reporter mentions that Gates owns a restaurant at 12th and Brooklyn, which is within the boundaries of the Black Heritage District.
“You have a restaurant in the area that would benefit,” the reporter says. “Have you heard any criticism that — “
“Why should I have criticism?” Gates asks.
“Because your restaurant would benefit. Has anyone said — “
“Well, I’ve got six restaurants all over Kansas City. Certainly, that’s one that’s in the area. We have tried to labor there for the last 40-some odd years, so that we might have a business in the area. I certainly did not run from the area.”
Funkhouser chimes in. “You haven’t left yet,” he says. “You stuck it out.”
“And I’m one of the few that built in the area, too,” Gates says.
“That’s right,” Councilwoman Melba Curls says. “Paved the way.”
“Are there any more questions?” Gates asks.
It sounds like a dare.
For decades, Gates has believed that integration hurt black business.
In 1970, around the time he sold a nightclub and restaurant at 31st Street and Indiana, Gates told a Kansas City Star reporter that he didn’t have it any easier than his father, George, who put the family on its present path when he bought the Ol’ Kentuck Bar-B-Q at 19th and Vine in 1946.
A “soul brother,” Gates said, using the lingo of the times, could expect no business from whites, especially after the 1968 riots. “And a large share of the black customers won’t buy from him, either, because he usually can’t buy in large enough quantities to be competitive, and he usually can’t afford well lighted modern buildings with modern fixtures and conveniences.” It was as if Gates had a crystal ball and could see chains such as Famous Dave’s Legendary Pit Bar-B-Que opening in downtown’s new Power & Light District.
George Gates had been a postal worker and a railroad waiter before buying the place at 19th and Vine. The pitman, Arthur Pinkard, had learned from the legendary Henry Perry. The business functioned more or less as a speakeasy until Arzelia Gates, Ollie’s Bible-quoting mother, prevailed upon her husband to make it more of a restaurant.
After graduating from Lincoln High School, Ollie Gates went to the University of Maryland-Eastern Shore on a football scholarship. He transferred to Lincoln University in Jefferson City when his father agreed to help him buy a car. Ollie drove home on weekends to work at Gates Ol’ Kentuck Bar-B-Q, which moved to 24th and Brooklyn in 1951.
A ROTC student, Gates served in the Army for two years. He returned to Kansas City with a wife, Maureen, and three children in 1956. (Two more were born later.) He began work on a new store, to be called Gates & Son Bar-B-Q, at 12th and Brooklyn.
In interviews, Gates does not describe his father with much warmth. He told the Star in 2000 that his mother was raised properly, but his father “was barely raised up at all.” In 1983, Gates told a business publication that he built the 12th and Brooklyn store only to be “exorcised” by his father. George Gates apparently felt that the kitchen wasn’t big enough for the both of them.
Ollie Gates took the name Gates & Son and opened a place at 12th and Highland. He also opened his own nightclub, O.G.’s, in 1961, a year after his father’s death. He told a Star reporter in 1970 that he wanted to establish a successful business “so that the public wouldn’t think I’m existing only on my dad’s name.”
After O.G.’s closed, Gates bought a drive-in at 47th and the Paseo. Restaurants in Leawood and Kansas City, Kansas, followed. By 1975, Gates was selling sauce in groceries and training workers at the College of Barbecue Knowledge, also known as Rib Tech. Lolis Eric Elie, author of the barbecue book Smokestack Lightning, wrote that Gates had eclipsed Arthur Bryant “in expanse if not in mythology.”
Gates eventually reclaimed the 12th and Brooklyn location he had built with borrowed construction materials. It had passed to his mother after his father’s death.
“My mother’s store had turned to junk,” Gates tells The Pitch. “She said, ‘Ollie, would you come down here and help me?’ I said, ‘Mom, let’s tear it down and go someplace else.’ She said, ‘You aren’t tearing my business down.’ So she sold it to me. And so there I went.”
Gates built a small shopping center around the remodeled restaurant. Gates Plaza now touches all four corners of 12th and Brooklyn. Along with barbecue, area residents — most live in subsidized housing — have access to a hardware store, a mini-mart, a bar, a nail salon and the flower shop Divine Floral Designs.
Desta Watson, who runs Divine Floral Designs with her husband, Robert, says the duty-free Black Heritage District would allow Gates Plaza to build on its success. “It gives the people of Kansas City an opportunity to see what this area has come to be,” she says.
Gates loves the area. In 1984, he helped found the Twelfth Street Heritage Development Corporation, which provides affordable housing. Inspired by a trip to San Francisco, Gates and Twelfth Street Heritage recently developed six colorful townhomes on Woodland Avenue.
Commercial development along 12th Street doesn’t make Gates a lot of money. He says it costs the same amount to build on the East Side as it does in other parts of the city, yet he can charge only a third of the rent.
Gates says he is not finished, however.
“What do you call it when you get that urge in you to keep doing something? Whatever that is, that’s what it is. Twelfth Street has gotten into my bones, and I want to see that mature.”
Other development efforts by Gates have not produced the same level of personal satisfaction or community benefit.
Around the time that Gates began to redevelop 12th Street, former Mayor Richard Berkley named him to the city’s Parks and Recreation Board. As a commissioner, he picked up a reputation for abusing his authority.
Toward the end of his board service, Star columnist Barbara Shelly called Gates the “lord of the fief” who “oversaw the kingdom and its golf privileges with a courtly vengeance.”
Shelly based this view partly on a leaked parks department memo that gave instructions on how Gates, the parks director and their guests should be treated when they played Swope Memorial Golf Course (appropriate greeting: “Good morning, gentlemen”).
A more insidious charge emerged from the Brush Creek flood-control project.
In the early 1990s, the city moved to condemn Gates’ restaurant at 1411 Swope Parkway and other property along Brush Creek in order to accommodate a new design that was less prone to flooding. Gates looked to rebuild on the other side of the water. He envisioned a retail center between Troost and the Paseo and began buying homes in a small, creekside neighborhood.
Around the same time, the parks board approved a plan to beautify the re-engineered creek.
The residents of the integrated neighborhood at 47th and Virginia did not welcome Gates’ arrival. They complained that he rented his houses to ex-cons and allowed them to live in squalor. “There were people living there without water,” says Ralph Levy, a former resident. Levy says he used to leave out a garden hose so Gates’ tenants could wash their dishes.
At one point, Gates acknowledged that he hadn’t been a good neighbor. “My intent was never to keep the houses but to tear them down,” he told the Star in 1995.
The Planned Industrial Expansion Authority, a city agency that grants tax breaks, found the area blighted. Gates continued to acquire property. The owner of a liquor store in the area filed a complaint with the state Ethics Commission, claiming that Gates had misused the knowledge he gained as parks commissioner. An investigator assigned to the complaint recommended that no further action be taken.
Levy, meanwhile, was the last neighborhood holdout and felt as if he’d come under siege. His home was burglarized three times. One day, when Levy left to replace his stolen VCR, he came home and found that his living-room window had been smashed with a rock.
After one incident, Levy went to the liquor store and joked with the owner that he expected to hear soon from Gates. Sure enough, when he got home, he learned that Gates’ lawyer had called his lawyer and asked if he was ready to sell.
“You cannot make any connections,” Levy tells The Pitch, “but it was kind of strange coincidence.”
Gates eventually offered $90,000. Levy, an IT specialist at Jewish Vocational Service, took the money and moved to Liberty.
With the help of $500,000 in tax-increment financing, Gates opened a new restaurant on the site in 2000. A 20-foot “Struttin’ Man” sign stands outside the building. The interior pays homage to the family’s original 19th and Vine location.
Gates thanked God for allowing him to build the new place. “It’s happening because my mother’s always praying,” he told the Star before opening the restaurant’s doors. (Arzelia Gates died, at age 95, in 2005.)
Levy went on to write a concise book about the block that had made way for Gates Bar-B-Q. It’s available online.
Gates didn’t know about the book until a Pitch reporter told him. He says those were bad times for him as well. He didn’t like the city taking his property. He didn’t like having to pay $90,000 for a house that was worth far less.
“I was unhappy about a whole lot of things,” he says. “But that’s a part of life for me. Sometimes you’re happy. Sometimes you’re sad.”
In February, Gates and other proponents of the Black Heritage District went to Jefferson City to make their case. They found that state lawmakers respond slowly to new ideas.
First, the team had to fight some old battles. Jeff Kaczmarek, the head of the Economic Development Corporation, a city agency that administers TIF, dealt with questions from Sen. Victor Callahan, an Independence Democrat, about the use of incentives in well-off areas.
Other concerns seemed to stem from piety. Sen. Jason Crowell, a Cape Girardeau Republican, questioned whether the tax-free zone would attract bars and strip clubs.
The bill did not make it out of the Economic Development, Tourism and Local Government Committee. John Griesheimer, the committee chairman, who lives 50 miles outside St. Louis, says the concept — which would allow any Missouri city to designate a tax-free area — is noble, but he worries about setting a bad precedent.
“We just keep chipping away at our sources of revenue,” Griesheimer tells The Pitch. “At some point, there’s not going to be enough revenue to go around.” Griesheimer says he could support the proposal if it eliminated local taxes but kept intact the state tax on goods and services.
The bill’s sponsor, Sen. Yvonne Wilson, a Kansas City Democrat, plans to reintroduce the measure next year.
In addition to lost revenue, decision makers must also take into consideration those areas outside the duty-free zone.
Carlos Gomez, president of the Hispanic Chamber of Commerce of Greater Kansas City, says he appreciates attempts to lift minority business. At the same time, it’s hard for him to get excited about a program that does nothing for the Westside and other struggling sections of the city. “I would like to see that limit to one area taken off,” Gomez tells The Pitch.
Jordan Rappaport, an economist at the Kansas City Federal Reserve Bank, listened to Gates speak at the library symposium. Afterward, Rappaport drew a comparison between the unfortunate side effects of desegregation that Gates described and those that the Black Heritage District might create if, say, the rush to fill storefronts left vacancies in other parts of town. Rappaport encouraged Gates and the plan’s backers to consider collecting the 7.725-percent tax and using the money for renovations. “You’d get the district but no competition with other areas,” he said.
Funkhouser and Gates made the point that TIF has created competitive imbalances for years, only on a grander scale. “You give TIF to [ad man] Bobby Bernstein on the Plaza,” Gates said, naming another well-known Kansas City executive.
Later, Gates will say he is open to ideas to improving the duty-free zone. “We thought of this and hoped it would work. If it don’t, hell, give us something that will work.
“Because it’s the city’s loss. It’s not my loss. It’s the city’s loss.”
Gates is piloting his black Chevrolet Regency SUV along the Paseo when he sees something that annoys him.
“Now, see this stupid thing. Take a great corner like 18th and Paseo and put a parking lot on it,” he says.
The offending lot sits at the edge of the 18th and Vine District, the taxpayer-financed residential area and tourist destination that isn’t quite either. The lot at 18th and the Paseo was a gas station before the city acquired it. Gates can’t comprehend the decision to use the land for parking. He thinks something more useful and visually interesting belongs on the corner. “Look at all this space. How many building fronts could you put there?”
Gates proceeds to point out all the vacant or underused pieces of ground more suitable for parking. “The guys are not thinking,” he says.
The SUV pauses on 19th Street. Gates, who studied masonry at Lincoln High School, points to a smokestack stemming from his dad’s original barbecue place. “I did it when I was 14 years old,” he says.
Gates lived at 23rd and Campbell in his formative years. As he drives along Troost, he names the small grocery stores that occupied nearly every block. He made 92 cents a day working at Lipsey’s supermarket.
Heading north, he approaches the Greyhound station that opened in the 1980s. “This bus terminal, you know where it should be?” he asks. “At the Union Station…. That’s where it needs to be, down at Union Station. Why not? There’s a depot. They’ve got everything down there.”
As Gates sees it, what the East Side suffers from most is a lack of wealth.
“If we don’t get money across Troost, if we don’t get in some form of people who have money — not the have-nots, you know, not the people who have their hand this way.” He lets go of the steering wheel and turns up one palm.
“We’ve got to have some people with their hand turned up the other way, so that you can build on that. People can’t prosper in an area if nobody has any money.”
Gates is a man of ideas, but he doesn’t profess to know everything. He says Kansas City needs to rebuild the population it lost to the suburbs. But, he admits, “I don’t have the slightest idea what would really make people want to come back to an urban setting if you don’t really have nothing for them.”
After driving a rough outline of the Black Heritage District, Gates turns from Prospect onto 18th Street. He stops at a light on Brooklyn. A man waits for a bus with plastic bags from Arthur Bryant’s at his feet. “He’s got a bunch of Bryant’s stuff there,” Gates says, taking stock of his competitor’s sale.
In the end, the Black Heritage District proposal is an admission of failures beyond TIF. The redevelopment of 18th and Vine, for instance, has not produced the pride or activity that former Mayor Emanuel Cleaver II and other backers had sought.
Gates co-chaired Cleaver’s 1991 campaign. But as he drives past the fake storefronts along 18th Street, he makes no effort to dress up one of Cleaver’s legacies.
“All this is bullshit here.”
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