The Leawood City Council wrangled Monday night with lawyers and owners of two strip shopping centers who are asking for the public to pay extra sales taxes to remodel, improve and expand their shopping areas.
They want the council to grant them a Community Improvement District, commonly called a CID. If approved, these would be among the first CIDs in Leawood’s history. The council also is considering a CID at Ranchmart North shopping center at 95th Street and Mission Road.
The owners of one shopping center, Leawood Plaza, 12200 State Line Road, want $500,000 in increased sales taxes; the owners of the other strip mall, Camelot Court, at 119th and Roe, want $8.9 million in sales tax revenue.
Leawood Plaza, a 26-year-old shopping area, is anchored by a HyVee grocery store. It has room for 24 other businesses, but is under-capacity now, with 15 service and retail shops filled.
“We’re trying to keep the shopping center viable,” said lawyer John Petersen.
HyVee and Leawood Plaza owner Diane Botwin want the city to raise sales taxes by one-half cent at HyVee and one cent at the rest of the mall. A HyVee lawyer said half-cent sales taxes for CIDs is a company-wide policy.
HyVee wants to use $1 million to remodel inside the grocery store, but Leawood Mayor Peggy Dunn said, “That’s expressly forbidden in our (CID) policy, to let you use any of the money on interiors.”
Petersen countered: “We’re asking you to expand your policy just a little bit.”
Other council members also had reservations.
“Their job (shopping center owners and HyVee) is to keep their property updated,” Councilwoman Carrie Rezac said. “They do it on their own. I struggle with asking taxpayers” to pay for interior and exterior updates.
Councilman Lou Rasmussen questioned how the project would benefit the public.
“There’s nothing in this petition about public improvement,” he said.
Michael Book, the lawyer for Leawood Plaza, said the company planned to close the grocery store for several months while contractors gut the building. The grocery store would resemble a Whole Foods market when finished, with a bigger and better bulk and health food section, he said, as well as an expanded produce area. The store plans to knock off the front of the store and enlarge it, raising the roof for a cafe and beer bar on a mezzanine level.
The improved store would be comparable to the HyVee that recently opened at 95th Street and Antioch Road.
The council agreed for the owners to come back at a later date to justify expanding its CID policy and to show how the public would benefit from the extra perks.
The council also had some issues with another CID request after a public hearing during its regular meting.
Owners of Camelot Court, at 119th Street and Roe Avenue, want a one-cent sales tax increase at the shopping center to help pay for a total of about $35.1 million in improvements. They would expand the Hen House grocery store, add a Tide dry cleaners with a drive-through lane and give CVS drug store a drive through, too. Besides that, the owners want to tear up and re-develop the parking lot with plantings all around the property and lighting. They would add bike racks, walkways for the handicapped and charge stations for hybrid cars.
One Leawood resident spoke against the project. David McIntyre said he thought the two CIDs could begin a dangerous trend.
“If you drive all around Leawood, you can find shopping centers that need improvements,” McIntye said. “Let them handle it themselves. We’re going to end up improving every shopping center within the confines of Leawood.”
After the meeting, Mayor Peggy Dunn said McIntyre’s predictions wouldn’t develop.
“Our CID policy is unique,” Dunn said. “It pertains to shopping centers more than 20 years old. It is truly for renovating older centers.”
At the meeting Rezac asked whether the new and improved plans had a cure yet for runoff water that plagues the back side of the shopping center, near where CVS is located. Petersen, the lawyer, said his team hadn’t gotten around to that problem. The developers also need to to address water in the parking lot, while protecting water quality, he said.
“Are we just lining our pockets?” Petersen said. “No. We’re hitting a double. We think we can increase it to a triple. And we invite the city to come along.”
The council didn’t vote on the Camelot Court CID. It told Petersen to come back to the council with the remaining issues solved.
Time is of the essence, Petersen said, because perspective tenants could move on if the CID isn’t approved soon.
“(Within) 60 days we’ve got to get rocking and rolling,” he said.