The Lee’s Summit City Council has taken a tentative step toward approving another new shopping center, expanding the boundaries of special taxing districts to provide subsidies for the proposed $72 million Summit Place development.
The council stopped short of fully approving incentives and rezoning Thursday, instead waiting on details of a TIF contract being negotiated with the developer.
Incentives have been a point of disagreement.
RED Development is seeking $18.5 million in incentives through tax-increment financing and community improvement districts, but some council members had objected to the size of the subsidy and using some of the money for buildings.
Typically, such subsidies in Lee’s Summit have been used mainly for public infrastructure associated with a project.
The vote was 5 to 3 to expand the districts, and the TIF contract would prevent the developer from getting a windfall from lower costs and cap its return on investment.
If the city and RED can’t negotiate a contract that’s acceptable to the council, the project will die.
RED Development plans to build the project near Interstate 470 and U.S. 50 where it also owns SummitWoods Crossing and Summit Fair shopping centers.
Summit Place is designed with 355,000 square feet of retail including a 135,000-square-foot anchor store.
The developers listed terrain where the store would go and a need to improve regional the storm water system among the reasons for the requested incentives.
Projections show that Summit Place would generate $1 million annually in sales tax revenue for the city before the TIF expires and more afterward.
RED’s predictions for SummitWoods Crossing were easily fulfilled, giving the city a big boost in sales tax revenue that previously flowed to other communities.
Critics, however, said the net of sales tax will probably be smaller at Summit Place, because some sales would be pulled from already established retail.The improvements to Ward Road, part of the TIF financing, would open another 100 acres for development, according to City Manager Steve Arbo.
Formal incentive policy sought
The Lee’s Summit City Council wants to create a clear incentive policy to make it easier for developers to know what to expect in its decisions.
At a retreat earlier this month, the council decided it wanted to adopt a formal incentive policy to outline what it is willing to trade for jobs and development.
To date the council has had an open-ended approach.
Mayor Randy Rhoads said he’d met with three different developers from the Kansas City area about how the city can improve its prospects for landing more businesses, and each said Lee’s Suimmit needed a clear incentive policy.
He’s starting to agree.
“For me, that’s a 180-degree change,” Rhoads said.
Councilman Bob Johnson said that without the policy city staff gets mixed messages from the council. Developers and staff work on a project that then comes to the council and dissection begins.
“They get blindsided with all sorts of questions,” Johnson said.
City Manager Steve Arbo said that a large development application can cost $200,000 plus months of time and a developer can end up betting on a single vote of eight people.
“That’s a huge risk for them,” Arbo said.
| Russ Pulley, Special to The Star