Hy-Vee officials will meet with the Leawood City Council to discuss its grocery store at 122nd and State Line Road, but the store will close as scheduled June 1, the chain said in a statement late Tuesday.
But if Hy-Vee can reach an agreement with the city on that location, a newly renovated store could reopen, the emailed statement said.
Hy-Vee announced last month it would close the store because it could not agree with city officials about a Community Improvement District.
Commonly called a CID, the development incentive is an extra tax imposed on those who shop in a store or stores to help the property owner pay for improvements.
Leawood Mayor Peggy Dunn on Tuesday asked corporation representatives to come to Leawood to have a conversation with the city at its May 19 meeting in hopes of reconsidering the store closure.
She noted that on Monday night the city council heard an hour and a half of citizen comments about the closing.
“A large crowd from both Missouri and Kansas shared their extreme disappointment regarding your decision,” Dunn wrote in an email to Hy-Vee.
Dunn did not offer how the city might change its stance on the CID for Hy-Vee.
In the statement, Hy-Vee said it appreciated the support its customers showed Monday night and was pleased for the invitation to discuss the long-term viability of the site. But most store employees have been reassigned, so the store will close. Reopening would depend on an agreement with the city.
The Hy-Vee project stalled because the council said the store’s CID request didn’t comply with city policy. The chain wanted a half-cent sales tax to be created at the store to help pay for a large-scale remodeling inside and out. The chain wanted to offer a larger health food section, more prepared food, more fresh produce and a full-service restaurant that served beer.
The council told lawyers for the developer that the CID could not be used for improvements inside the store.
CIDs have become controversial in Leawood, where city staff has recommended limits on their use. The City Council has not approved a CID but is considering three — at Leawood Plaza, Hy-Vee’s location; at Camelot Court on 119th Street; and at Ranchmart on 95th Street.
“That’s why we’re going through all the motions,” said City Administrator Scott Lambers. “We’ve never done this before.”
Lambers noted that if Leawood approved using sales tax money for interior store improvements, developers at Ranchmart and Camelot Court would ask, too.
Whatever the council approves for its first CID will set precedents to be followed at other shopping centers.
“That’s what everyone is being careful about,” Lambers said. “We’ve got these other applications. We’re not looking at the CID request in isolation. Whatever we do will affect the others.”
But several Hy-Vee customers expressed their displeasure with city officials at Monday night’s meeting.
“This is our neighborhood store. And I have this sucking feeling as our grocery store goes away,” said Leawood resident Dave Meek.
“We’re the local people left holding the bag,” complained one other resident.
Dunn said she had asked Hy-Vee to work with the company that owns Leawood Plaza.
“I called them the Monday before last and asked them to consider discussing this again, and the man just said ‘Thanks,’ and that’s all I ever heard from Hy-Vee,” Dunn said.
Lambers said when he told Hy-Vee that CIDs couldn’t pay for interior improvements, a representative responded, “I guess I’ll have to go sharpen my pencil and make some changes.”
Lambers said he never heard from Hy-Vee again.
“And did you ever contact them again?” asked Leawood resident Carol Amiri.
“No,” said Lambers.
“Mr. Lambers has really dropped the ball,” Amiri said later in the meeting.
Some residents expressed unhappiness with the city’s retail growth.
“Our overall concern — we’re asking that they be more proactive and bring more business to Leawood,” said Adrienne Frazier, a Leawood resident and business owner.
When the council agreed to ask Hy-Vee to discuss a possible CID at its meeting May 19, audience members murmured “Thank you,” and clapped.
The council wrestled with the Camelot Court CID on Monday as well. The developer wants the sales tax to pay for $10 million in improvements.
The question the council debated: Should the city allow the sales tax to pay for all of the $10 million that is eligible for CID funding, in a project whose total cost is approximately $36 million?
City staff has recommended that the tax pay for $3.8 million of the improvements.
Three of the city’s nine council members — James Azeltine, Andrew Osman and Tom Robinett — want to allow the sales tax to pay for 100 percent of the funds eligible for CID.
Some council members want to take a line-item approach. For example, out of the $10 million eligible for CID funding, the city would pay for 60 percent of the new sidewalks, 100 percent of the new drainage and 25 percent of the updated landscaping.
Some council members suggested setting an aggregate cap on the reimbursements, with recommendations of 50 percent, 66 percent or 75 percent.
No clear consensus was reached Monday night.
Dunn said in an interview with The Star that a majority of the council supports using the tax for 50 to 70 percent of the project’s cost.
The council will discuss the issue again June 2.
Lambers predicted that wherever the council lands on the CID, the vote won’t be unanimous.