Foutch Brothers drops plan to remake Kemper Arena for youth sports

A development company that had proposed saving Kemper Arena and retooling it as a regional youth sports facility has withdrawn its plan.

Foutch Brothers announced Wednesday that it would no longer pursue its Kemper redevelopment plan. Meanwhile, a Kansas City Council committee leader said he would recommend that the city pump $20 million into a rival American Royal plan instead.

Foutch Brothers sent a statement to City Hall saying that “as a result of circumstances beyond their control” they had decided not to continue their plan to repurpose Kemper.

Company officials declined to elaborate except to thank community members who had advocated their youth sports concept.

Foutch’s withdrawal means Kemper’s demolition is more likely. It opens the door for the city to negotiate with the American Royal Association, which wants to work with the city on a new custom-designed building to replace the aging arena.

But City Councilman Ed Ford recommended Wednesday that the city consider providing $20 million for the new building construction, rather than the $30 million that the American Royal had requested.

The debate over Kemper Arena’s future came into somewhat clearer focus at Wednesday’s meeting of the Planning, Zoning and Economic Development Committee, chaired by Ford.

The committee has been meeting since July to weigh its options. Kemper Arena has lost nearly all its events to the Sprint Center in recent years and is currently mothballed for most of the year.

The two key options under consideration were from Foutch and the American Royal.

Foutch Brothers, a local development company that specializes in historic renovation, had a $22 million plan to acquire Kemper Arena from the city and reconfigure it for youth basketball, volleyball and other sports. Its plan depended on private financing and historic tax credits.

But the American Royal said it was actually cheaper in the long run to demolish Kemper to make way for a new building, along with improvements to Hale Arena and the existing American Royal Center.

The American Royal said it could fill those facilities with its own events and with youth sports in partnership with the Sporting Kansas City investor group. Its plan would also create more parking lot space in the West Bottoms for the American Royal’s annual barbecue competition, its largest event.

The American Royal has a lease with the city through 2045. The organization argues that to comply with the lease the city had to get on board with its plan or risk pouring tens of millions more dollars into fixing a deteriorating Kemper Arena and American Royal complex.

On Wednesday, Kansas City Finance Director Randy Landes said the city spends about $2.3 million in annual operating subsidy and other costs at the American Royal complex. He said that if the city issued $20 million in bonds for the American Royal, the debt service and annual $1 million operating subsidy would also add up to $2.3 million — contending that rebuilding the arena wouldn’t exceed what taxpayers shoulder now.

But if the city issued $30 million in bonds, as the American Royal has proposed, the city’s annual debt and operating costs would go up to nearly $3 million per year, Landes said.

Ford doubted the city budget could accommodate that additional cost. He said he would recommend that the City Council consider the $20 million bond for the project. Such a revenue bond issue probably would not require a public vote and could be paid back with a combination of general fund and convention and tourism taxes.

Attorney Korb Maxwell, representing the American Royal, said Wednesday that he would take the proposal to the association’s board for consideration. Maxwell said the American Royal has been waiting three years for a viable city offer on the new building proposal.

“This is a great starting point,” he said.

But historic preservationists were deeply dismayed at the idea that Kemper may now be torn down.

Lucinda Rice-Petrie, past president of the Historic Kansas City board, said she had viewed the Foutch plan as a positive reuse of one of the city’s most iconic architectural structures.

Dan Cofran, another member of the Historic Kansas City board and a former city councilman, also questioned why the city would even consider issuing a $20 million bond for the American Royal when the city has so many urgent and unmet basic service needs.

“This city,” he said, “is addicted to debt.”

This story was originally published October 29, 2014 at 1:53 PM with the headline "Foutch Brothers drops plan to remake Kemper Arena for youth sports."