The Kansas City Council approved tax incentives Thursday for developers of the planned Three Light apartment building, but not without continued debate over the city's role in subsidizing luxury highrises downtown while the supply of affordable housing remains scarce.
The measure, which passed by an 8-to-4 vote, gives Cordish Companies, developer of the Power & Light District, a 100 percent property tax abatement for 25 years on the 300-unit building, scheduled for construction beginning in early 2019.
The benefit will be offset in part by payments from Cordish in lieu of taxes to Kansas City Public Schools, libraries and mental health programs — all of which depend on property tax revenue.
But that amount is far less than what would be generated over the next quarter-century if the project were completed without tax breaks. Under the agreement, Cordish's payment will amount to about $8.6 million over 25 years. Were Three Light built without the abatement, city officials estimate that Cordish would be obligated to pay $12.5 million.
Cordish officials contend that without the abatements, the $130 million Three Light is not financially viable. Some council members say this argument is belied by the success of the company's two other apartment buildings, One Light and Two Light.
Two Light, which opened this spring and is expected to be fully occupied by this fall, offers monthly rents from $1,200 for a one-bedroom apartment to $6,000 for a two-bedroom penthouse with a private terrace.
Thursday's debate was dominated by three mayoral candidates: Councilman Scott Taylor, Mayor Pro Tem Scott Wagner and Councilwoman Alissia Canady.
Canady, who made more affordable housing and fewer incentives for high-end developers cornerstone issues of the campaign she launched on June 5, said the Three Light deal is untenable.
"I understand that economic development must happen, but it must be responsible," said Canady, whose 5th District includes part of the city's economically struggling east side. She added that she wants to keep the city moving ahead, but not at the expense of its most vulnerable citizens.
"It's moving," Canady said, "But it is moving further and further away from the people who need us the most."
Taylor and Wagner defended the agreement as a quantum improvement over what the city currently collects in taxes on the site, now a parking lot at Truman Road and Grand Boulevard.
Taylor said the land currently generates about $1,000 a year for Kansas City Public Schools.
"The total (under the abatements) is much more significant," he said.
Wagner said it was "easy to beat up on a developer," and that the city has done well on behalf of schools and the other jurisdictions.
"I'm trying to figure out how we failed them," he said.
The council granted similar packages to Cordish — including underground garages built at city expense — for One Light and Two Light. They were part of a 2003 deal the city struck with the company under Mayor Kay Barnes, when downtown was a virtual economic dead zone.
The council ultimately decided that it was bound by 2003 accord, and voted 8-to-3 in March to build a third garage for $17.5 million. After protests by Canady and Councilwoman Katheryn Shields, Cordish agreed to concessions, including conversion of the Midland office building to 100 apartments with low and moderately priced rents.
Shields still opposed the tax abatements Thursday.
"I fully understand that Mayor Barnes felt the need to move forward with One Light," Shields said. "But this is 15 years later, and downtown is a very vibrant place."
Last month, a state advisory board signed off on the abatements, but voiced similar concerns.
Voting for the measure were Council members Taylor, Wagner, Heather Hall, Teresa Loar, Jermaine Reed, Lee Barnes Jr., Kevin McManus and Mayor Sly James. Voting against were Canady, Shields and Council members Dan Fowler and Jolie Justus. Councilman Quinton Lucas was absent.