Who knew buying a park could be so complicated?
The Prairie Village City Council on Monday held an informal meeting to field questions from residents — and some of its own members — on how the financing for the proposed development on the former Meadowbrook Golf and Country Club would work.
VanTrust Real Estate plans to develop part of the 137-acre Meadowbrook property bordered by 91st and 95th streets and Nall and Roe avenues, building a senior living center, two areas of townhomes, luxury apartments, single-family homes and a boutique inn.
The city would buy the remaining 88 acres and turn that land over to the Johnson County Park and Recreation District for a public park, more than doubling the current amount of parkland in the city’s borders.
The city estimates that its costs, including buying the land and paying for park improvements, public streets running through the park and other public infrastructure, would range between $15.3 million and $18.8 million.
To pay for it, the city would create a tax-increment financing (TIF) district and issue between $8.5 million and $9.5 million in general obligation and between $5.8 million and $7 million special obligation TIF bonds. The city would pay back the bonds with the additional property tax revenue generated over the next 20 years by the property that VanTrust is developing.
Prairie Village would also consider creating a 9 percent transient guest tax charged to guests at the boutique inn on the property. A portion of the taxes would go to paying off the bonds, with the rest going for public events and activities held in the park.
The city would also issue industrial revenue bonds on behalf of VanTrust that would give the developers a sales tax exemption of between $1 million and $1.7 million on equipment purchased for the project. The developer has agreed to put its sales tax savings back into the project.
If the project were to fail and the city received no additional property taxes, the city would be on the hook for paying back the general obligation bonds, which would cost up to $900,000 a year, officials estimated. City Administrator Quinn Bennion said that in a “worst case scenario” where the city couldn’t curtail capital projects or tap other revenue sources to help pay the debt service, that cost would require a 3-mill boost in property taxes.
As for the special obligation TIF bonds, the bondholders would have to absorb the loss. The city also is not ultimately responsible for the industrial revenue bonds.
Jeff White, the city’s financial adviser, attempted to assuage council members’ concerns about the likelihood of such a disaster, saying the city will perform due diligence as part of the final development agreement.
“Nothing they’re building there doesn’t already exist in Johnson County,” White said, adding that residential development is typically easier to predict than retail.
Residents asked a number of questions about the park, such as whether the land could ever be used for something else, whether it would have enough parking and how the city could control how it was developed.
Bennion said the city could place restrictive covenants on the land before giving it to the county to preserve it as a park and to dictate how it could be used. He said parking would also be better detailed in the final agreement the city hammers out with the park and recreation district.
Martha Houts, who lives near the site, said she was frightened at the prospect of potentially paying higher taxes and questioned whether the city should be buying a park.
“I am concerned as someone who is retired where we’re going with all of this,” Houts said. “I have a hard time in my mind balancing all of this.”
Council members, however, responded that park land is a prime demand they hear from residents. They also said that if the development does take off and generate increased property taxes, it would help the overall economy.
“You can’t say with certainty that this could never increase your taxes, but I’m favorably inclined at this point because I believe with 95 percent certainty it’s going to be neutral or reduce your property taxes,” said Councilman Eric Mikkelson.
The council is scheduled to vote Monday on a final memorandum of understanding between itself, the developers, the Johnson County Park and Recreation District and Johnson County wastewater that will outline the general structure of the development and identify each group’s responsibilities in coming months.
Officials still must negotiate a final development agreement with VanTrust, hammer out the details of the TIF district and bonds, and approve paperwork for handing over the park land to Johnson County.
White said Prairie Village hopes to sell the TIF bonds in December and for developers to begin construction early next year.
In other business, Prairie Village officials held an open house earlier in the day Monday to get public input on rebuilding Mission Road between 71st and 75th streets. Residents have complained that the sidewalks along the four-lane road, which families and children use to walk to St. Ann Catholic Church and Shawnee Mission East High School, are narrow and lack any buffer from traffic.
Besides the current four-lane layout, residents at the meeting could weigh in on three other options:
▪ A three-lane road with an 8-foot-wide trail on the west side separated from traffic by a 2.5-foot buffer and a regular 5-foot-wide sidewalk on the east side separated from traffic by a 5.5-foot buffer.
▪ A three-lane road with an 8-foot-wide trail on the west side separated from traffic by a 7-foot-wide buffer and a 6-foot-wide sidewalk on the east side separated from traffic by a 2-foot-wide buffer.
▪ A three-lane road with 5-foot-wide sidewalks on either side and 5-foot-wide bike lanes on either side.
Brad Trenkle, who lives nearby, said his family regularly uses the sidewalks, and he favors a combination of the two options widening the sidewalks.
“Two families walking with strollers don’t have to have a head-on collision or decide who has to jump into the street,” Trenkle said.
Public Works Director Keith Bredehoeft said his staff would report the comments they received to a city council subcommittee looking at the Mission Road project and come up with a more finalized plan. That will go before another open house before the full city council votes on it later this fall.