What we know about new tax break plan for Country Club Plaza

The Port Authority of Kansas City has presented a new plan for tax incentives that would help support Gillon Property Group’s proposed revitalization of the Country Club Plaza.

Previous proposals late last year for support through Port KC were met with opposition, including from Kansas City Public Schools officials, about the level of property tax revenue that would be diverted from local taxing bodies like schools and the library as Gillon pursues new development on the Plaza.

Property tax bills are based on property value. As property values rise with new improvements, so do property taxes owed.

Port KC is able to offer support for big projects by instead giving property tax breaks on those improvements to developers — who still make payments, but pay less than they would with no incentives.

That’s meant to help the math for development costs pencil out to make projects a reality, but means less tax revenue coming in from the development than there could otherwise be.

Officials shared the new version at a Port KC Board of Commissioners committee meeting on Monday.

The latest version, according to a Port KC presentation, would “basically stabilize and solidify the existing taxes as they are today,” with increases every year for 30 years. The increase would typically be 2% each year.

That would mean more than $234.5 million in fixed payments for taxing bodies over that time period.

And there would be an additional, estimated $46.5 million in payments on the back of denser new development.

Together, that would mean over $281.1 million in revenue for taxing bodies like the school district over 30 years, up from a reported $121.2 million under the original proposal.

How much the owner would be saving on property taxes in total was not immediately available.

The plan would also include sales tax breaks on construction materials.

The Port KC has not yet voted on the plan. Meetings between the developers and local taxing bodies about the plan are scheduled for this week.

Gillon would put $5,000 into the city’s Housing Trust Fund for each housing unit it builds, which would total $4.12 million for a planned 824 units. That’s in line with newer city and Port KC policy, which the Plaza plan predates.

Gillon Property Group has sought to stabilize the famous shopping district — which has faced struggles in recent years with vacant storefronts, declining property values and failing infrastructure — and has pledged to bring in new businesses and build new housing in taller buildings that would add residents to the area.

Besides the new housing units, the ambitious project could also include about 150 new hotel rooms while fixing up and improving infrastructure around the Plaza.