The Olathe City Council has signed off on selling $200 million in industrial revenue bonds for the planned expansion at Garmin International Inc.’s campus.
Council members on Tuesday approved the agreement, which also calls for granting the navigation technology company a 10-year, 75 percent tax abatement for the new property.
Garmin is actually responsible for buying and paying off the bonds, and city taxpayers will not bear any responsibility. Having the sale coordinated by Olathe will provide the company lower interest and tax benefits.
The council voted on the agreement as part of a slate of items on its consent agenda and made no comments about the deal.
Garmin first unveiled its plans to expand its campus in late 2015, and Olathe officials voted to approve the expansion a little more than a year ago.
In August, the company announced that the project would involve building a 750,000-square-foot manufacturing and distribution facility on 29 acres near 151st Street and Mahaffie Circle.
The project’s second phase, to be started after the new facility is completed, would retrofit Garmin’s existing manufacturing and warehouse facility for research and development office space.
In paperwork filed with the city, Garmin has formally requested the first $102 million in industrial revenue bonds to pay for the new warehouse. The remaining $98 million in bonds will be requested later.
The company said the project will create 150 new jobs with an average salary of $66,653 in the first year.
The tax abatement, which will also involve property taxes normally paid to Johnson County, the Olathe School District and other taxing jurisdictions, is expected to save the company about $20 million on the warehouse alone, according to city estimates.
Currently, the vacant property generates only $1,850 in property taxes. Even with the partial exemption, the city and other jurisdictions should expect to receive $6.6 million over the 10 years on the new facility alone.
Once the abatement expires, however, the city estimates it will collect an additional $516,653 a year in property taxes.
In other business:
▪ The council voted unanimously to approve a 113-unit subdivision behind Olathe East High School.
The 36-acre development at Black Bob Road and 130th Street will feature mostly two-family residences and be built atop an access road the school currently owns that students use to get to Black Bob Road.
The new neighborhood will continue to be linked to the school, as well as have a new connection with the Forest Hills subdivision to the north through Constance Street.
Planners have recommended closing the access road to the school once the development can connect southward to a future extension of 133rd Street between Black Bob Road and Greenwood Street, although it’s unknown when that will happen.
Dozens of residents from Forest Hills attended the meeting. Michele Kooiman, a representative of the neighborhood’s homeowners association, said they supported the new development but opposed the connection to their subdivision, which they noted had narrow and winding streets.
“We feel strongly that routing school traffic down Constance would really be detrimental to the neighborhood,” Kooiman told the council.
Councilwoman Marge Vogt seemed to agree and attempted to have the northern connection removed.
“I don’t see some of these (traffic) solutions taking place in the very near future,” Vogt said.
Her motion failed on a 3-3 vote.
▪ The council also voted unanimously to rezone more than 15 acres to allow the expansion of the Harvest Bible Chapel church at 16000 S. Black Bob Road. The church plans to add 11,355 square feet to the existing building for additional meeting and classroom space.
▪ Council members also approved contracting with ConvergeOne LLC to provide online chat services for city utility customers with questions about their bills. City officials said they plan to begin training staff in April and rolling the service out for the public by the summer.
David Twiddy: firstname.lastname@example.org