As a $90 million STAR bond district was unanimously approved Thursday night for the 94th and State Avenue area, one thing was missing.
The development agreement for a major feature of the district, the national soccer training center, was not part of the package presented for approval at the Unified Government Commission meeting.
While project plans for the soccer training center area were approved, the actual development agreement for the soccer center is pending.
“We anticipate having a development agreement structured with Ongoal for their project related to the U.S. Soccer facility at a future date,” said George Brajkovic, UG director of economic development.
That soccer training area was one of five areas outlined for the bond district. A development agreement for the other four areas was approved Thursday night after a public hearing. The development agreement was with SVV 1, LLC. The soccer area agreement will be with Ongoal, parent company of Sporting Park.
The STAR bond district is roughly from 94th Street to I-435, and from State Avenue to Parallel Parkway.
The first project area is the existing Schlitterbahn waterpark, according to Brajkovic. The second project area is the proposed auto dealership mall, with hotel and restaurant pad sites. The third project area is a 59-acre site for future retail and possible office area use. The fourth area is for the U.S. Soccer training facility. The fifth area is for future waterpark expansion and lodging.
The total cost at completion is projected to be near $660 million, Brajkovic said. The STAR bond financing would be capped at $90 million, he said.
No UG general obligation funds or other backing by the UG is planned for this project, he said. In STAR bonds, 1 percent of the city sales tax and the UG’s share of the county sales tax would go toward the project. The transient and hotel guest tax also would go toward this.
He estimated $42 million in new appraised value at full buildout. The total annual effect is $2.3 million from this project that will be retained locally, he said.
Commissioner Hal Walker asked if there were any guarantees in the agreement that this is accepted as the appraised value for real estate taxation purposes. Brajkovic said there were no guarantees of that nature. The estimate was based on existing values, and he felt they were conservative estimates.
Walker said there were instances of other projects that were said to have a certain value, but at tax time lawyers argued they were worth 10 cents. He hoped there was a guarantee of the value when it comes time to pay the taxes.
Brajkovic said the project has performance criteria built into the $90 million figure. About $25 million is held back in two tiers, he said. If the developer executes a ground lease to provide ground to the U.S. Soccer project and cleans up 50 acres in the third project area, it would release $15 million. If the UG has an unconditional fully executed agreement for U.S. Soccer in the fourth project area, or if the developer timely commences the initial phases of the third project area in a retail area, then $10 million would be released.
Brajkovic said two auto dealerships that have been in Wyandotte County, a Ford and Chrysler dealership, are among those proposed for the auto dealership area. The dealerships may have previously been considering leaving the county, according to the UG. Within the agreement is a provision to capture the base sales tax they were producing, he said.
In the third project area, there is a five-year deadline to initiate development before the UG gets an option on the property.
There also is a prevailing wage provision in the agreement, which is left in as previously negotiated in the earlier version of it.
Donations to community not-for-profits, designated by the UG, of $750,000 payment upon bond issuance, with about $100,000 per year after that, increasing in increments, is included in the agreement.
Todd LaSala, attorney, said the auto mall project is west of 94th Street. The developer would start work by Dec. 31, 2014, and complete four auto dealerships by Dec. 31, 2016, he said.
The start of the third project area, retail area, would be started by Dec. 1, 2019, and developed in phases, with completion by December 1, 2022.
The new projects included in the STAR bond district are the $115 million in new capital investment for the new auto plaza area, and $187 million for the retail facility in the third project area, LaSala said.
The UG would be reimbursed through part of the $90 million for improvements already made to 98th Street, for a sewer interceptor and for a traffic signal.
In the auto plaza, only new sales above $15.5 million would be allowed to benefit this project, he said. Other portions of the sales would be captured and distributed, the way it was before, with the county the same way, and the city portion split between Bonner Springs and Edwardsville to protect the existing base.
The agreement calls for improvements along State Avenue, including new driveways for St. Patrick’s, and sidewalk improvements.
Project officials said they would be ready to turn dirt in the next few weeks with this project, if approved.
Robb Heineman, CEO of Ongoal, the parent company of Sporting Park, said about U.S. Soccer, “The fact that they are going to call the Unified Government home now is incredible, it gives me chills to say that to you tonight.”
The soccer portion of the project includes about 15 soccer fields, an indoor field, about 100,000 square feet of training and sport science, and futsal courts throughout the community, he said. The coaching and refereeing training would be located in the building.
“I want to thank you for the patience you’ve shown in giving us the time to make this happen, and I give you my word that when it happens it will be very special,” he said.
During the public hearing, an attorney appeared representing the owners of Legends Outlets. He said the notice about this expansion did not reach the right persons until today. Generally, the owners are not opposed to this project, he said, other than the addition of the STAR bond district to include their project. They haven’t had any dialogue about it, he said. He asked that they have the opportunity to have some dialogue about the effect on the project.
UG planning staff said that notices had been sent out to the Legends Outlets, with other notices, about 10 days before the hearing.
Also during the public hearing, a few residents, Maryann Flunder and Mary Martin, were concerned about minority, local and women-owned businesses receiving some contracts for the construction work to be done, especially businesses from Wyandotte County.
One person who lived near the project said she was proud that development was taking place there.
Another person who lived on 94th Street said he wondered if any discussion had been made regarding the residents who live there. “We’re going to be left alone, still, or are you guys going to give us some money?” he asked.
Thomas Gordon agreed with Commissioner Walker about making sure that the taxes were paid on the project valued on $42 million.
Marcia Rupp said it was wonderful for Wyandotte County, and reminded commissioners they need more police and fire staff with the increased development.
Greg Kindle, president of the Wyandotte Economic Development Council, said the use of STAR bonds has been of tremendous benefit to Wyandotte County.
“It has propelled this community into being the top destination in the state of Kansas, with an estimated 10 million annual visitors, $650 million in annual sales generated from the area, and making up 10 percent of the county’s annual assessed valuation,” he said.
The expanded area drives development to the east side of I-435, he said.
“In a broader context, this infuses new excitement into this quarter, providing long-term economic growth to the community, creates additional tourism destination appeal, and once again, shows Wyandotte County’s aggressiveness toward economic development,” Kindle said.
Rep. Tom Burroughs, D-33rd Dist., who represents the area where the development is, said he supported the project. He said communication and inclusiveness generates good government, and he would hope, moving forward, to continue to hold public hearings and engage the entire community.
“With the national attention of Sporting Park and the continued commitment under the most economic trying of times by Schlitterbahn, we have good partners, we have long-term viability,” he said.