The high-stakes battle over tax incentives for a Crossroads Art District redevelopment project reached a new level Thursday.
The Kansas City Clerk’s office confirmed that a group opposing incentives for Shirley Helzberg to redevelop a vacant warehouse for the prominent BNIM architecture firm had gathered enough signatures to try to overturn the deal.
The petitioners needed 3,417 valid signatures of Kansas City registered voters, and the clerk’s office gave a final count of 3,962 signatures.
The petitioners are asking the City Council to repeal its ordinance approving tax increment financing for the project at 1640 Baltimore Ave. If the council won’t repeal, the petitioners want the voters to decide on the incentives in a referendum election in the spring.
The City Council wants to avoid an election and save the project by crafting a compromise between the petitioners and Helzberg, the developer and civic philanthropist. Some behind-the-scenes conversations have occurred in the past week to 10 days. But as of Thursday, there was no resolution that all sides could support.
Still, the mayor’s office held out hope that some agreement could still be reached with the petitioners.
“Conversations involving several taxing jurisdictions, the Mayor’s office and the Economic Development Corporation of Kansas City have been held to resolve the matter,” said Michael Grimaldi, spokesman for Mayor Sly James.
“There is a sincere interest in finding a balance between right-sized incentives and sustained growth...We’re hopeful there will be an outcome for both this project and for the long-term that hits that balance, and discussions will continue in the New Year.”
The committee of petitioners includes Kansas City school district parents and teachers, plus civil rights and social justice activists. They object to the use of $5.2 million in tax increment financing over 23 years for the $13.2 million project.
They argue that tax redirection takes away too much money from the Kansas City school district, and that incentives are no longer needed to spur development in dynamic, up-and-coming areas like the Crossroads.
Project supporters say the building is blighted, and the benefits from this worthwhile redevelopment far outweigh the costs of the taxpayer financing.
Before Christmas, the City Council floated a compromise to try to appease the petitioners, with the city putting more money into the project, which in turn would free up other payments in lieu of taxes to go to the school district.
But so far, the petitioners aren’t backing off.
“We love the project but we always felt the level of incentive financing it received was not appropriate, because of where it was located,” said Jennifer Wolfsie, a Kansas City school district parent leader and petition committee member.
Wolfsie said the petitioners have called attention to an issue that goes far beyond this particular project.
“Getting the signatures turned in and getting that done validates there were enough people who felt the same way as the petition committee,” she said, adding that people want to be heard about the excessive level of tax breaks in Kansas City. “That sends a message.”
Wolfsie said she believes the petitioners have already prompted a very healthy conversation in Kansas City toward crafting a “reasonable and balanced incentive policy in this city.”
But she declined comment on whether the petitioners could accept any kind of compromise specifically to save the BNIM project.
Helzberg’s attorney, Jerry Riffel, could not be reached Thursday for comment about the petition drive’s successful completion.
But Riffel and others have said in the past that the project really can’t wait for the outcome of an election in the spring. That’s because BNIM needs to vacate its current leased space by December, and it’s already behind schedule in starting construction on the new headquarters.
Steve McDowell, chief executive officer of BNIM, said Thursday he believes even the taxing jurisdictions, such as the library system and the school district, want the company’s plan to move forward.
“It feels like there’s a lot of interest and initiative in trying to figure out how to get through this impasse,” McDowell said. “The real issue isn’t our project. It’s the economic policies and finding a way that everyone feels like they’re being heard and can work together in the future.”
It’s in the city’s best interest, he said, to save the deal. But he wasn’t sure how that might occur and said his firm is beginning to look at alternatives for its future in case the 1640 Baltimore plan falls apart.