Lowe’s proposed for northwest

• E-mail story
• Comments
• iPod friendly

By Bobbi Mlynar (Contact)

Monday, August 25, 2008

A Lowe’s home improvement store apparently will be the centerpiece of a development described in the city’s first official application to create a Tax Increment Financing district here.

According to an application received by the city on Friday, D.J. Christie/Emporia Investors of Overland Park has asked for TIF and Transportation Development District (TDD) assistance “or some combination thereof,” for a planned development on the northeast corner of 24th Avenue and Industrial Road.

Christie’s representative in the application process is lead attorney F. Chase Simmons of Polsinelli, Shalton Slanigan Suelthaus, of Kansas City, Mo.

The application lists the following preliminary plans for five buildings on the 39.905 parcel of land:

• Lowe’s — an approximately 77,744 square-foot building for a home improvement store on the northwest part of the property. A 22,588 square-foot garden center and a 45,885 square-foot lumber yard also is included.

• Outlot A (potential restaurant) — a 45,900 square-foot pad site for a 4,500 square-foot building on the southwest corner.

• Outlot B (potential restaurant) — a 45,900 square-foot pad site for a 6,000 square-foot building.

• Lot C (potential retail establishment) — a 17,500 square-foot building, east of Outlot B, on a 2.526 acre pad site.

• Lot D (potential retail establishment) — a 14,025 square-foot building on a 3.201-acre pad site.

Lowe’s and Outlot A are scheduled to be open for business in the second year of the project; the remaining businesses would be opened in the project’s third year.

Christie’s application is on the agenda for the city commission’s study session at 9 a.m. Wednesday, city attorney Blaise Plummer said this morning.

Handling the application, and an auxiliary re-zoning request for the property, will be a “step-by-step process of development,” Plummer said.

Public hearings on both the zoning and the TIF application, a financial feasibility study, a study of potential impact on existing businesses, and other work will need to be completed before decisions can be made, he said. If the city commission decides to approve the application, boundaries would be set in a resolution to establish the TIF district.

“Now there’s a parallel process going on with the planning commission, which involves a Planned Unit Development (PUD) process for this project,” he said. “So all of the TIF and transportation district financing discussions are subject to final approval of zoning, and that’s just because of the site here that’s been chosen would have to achieve a re-zoning in order to support that project.”

The zoning process takes up to 60 days, he said, and the zoning commission’s recommendation will be presented to city commissioners for approval or denial. City commissioners also can send the matter back to the zoning commission for further study.

“So all these steps are tentative,” Plummer said. “In other words, establishing a TIF district is subject to the rezoning process.”

If a TIF district is established, commissioners next would need to designate the property as an area of economic blight. Kansas statute definition of economic blight is broadly written, Plummer said.

“It doesn’t necessarily have to be a dilapidated district; it can also be economic blight,” he said. “Land being vacant and land not being used for its best purposes” can constitute economic blight, and the developer will make the presentation about that.

An independent entity then would provide information to the city about the economic feasibility of the project.

“In other words, whether the tax increments that are going to be captured are sufficient to pay for the bond issued for the infrastructure and improvements,” Plummer said. “In addition, the economic studies would also indicate impacts on existing businesses, exactly how that would be forecast.

“This basically would give the city commission information they need to reach a final decision on the project.”

When all of those requirements have been satisfactorily met, the city commission would need to agree to partner with the private developer to create the TIF financing.

“That would be when you’re entering your final phase,” Plummer said. “Once all those things are established, then the bonds can be issued and the developer can proceed to the execution stage of actually starting that development and putting in place the new facilities.

“Any of these bases, or touchstones you might call, are critical to the success of the overall project. And so they have to be taken in turn, one step at a time, and analyze all the factors and to reach the appropriate decision.”

Plummer said that if the planning commission and city commission both approve the re-zoning, but the city commission decides not to create the TIF district, the property planned for the development ultimately would revert to its original zoning.

Plummer said that throughout the process, public comment will be open on both sides of the issue.

Christie already has gained TIF financing from Manhattan, Kansas City, Kan., Olathe, Ottawa and Pittsburg, and such assistance has become necessary for cities to attract retail development, Plummer said.

He contrasted the current development with the development of the Wal-Mart store on Industrial Road. Wal-Mart was done with private investment, “but in order for that store to go in there, the city of Emporia had to spend tax money developing the roads around there to handle the traffic,” he said. “At least if you do TIF financing for a project and TDD ... you recapture some of the (money). It’s not being funded by the taxpayers, it’s being funded by the development, by the increase in taxes. ...”

When the TIF and TDD are repaid, the increased taxation comes into the city budget.

This development, however, is the first formally requested assistance since the city commission last year approved such financing for retail businesses. City officials are studying the processes used by other Kansas cities, but still will need to approach the application methodically.

“The first time you do a process like this, there’s a learning curve,” Plummer said. “... Change is always challenging. The best way to deal with that is through developing facts. That’s what this process is attempting to do, is to reach a result that makes sense based on what facts you have developed.”