City Beat: Council considers appropriating $225,000 overcollection

A community improvement district in the city has been collecting sales tax revenue past the agreed-upon termination trigger, and now there’s a bucket of money to spend, Springfield City Council members learned at their July 16 meeting.

A public hearing bill proposes to reinvest the funds in additional street and traffic improvements within the original CID surrounding the Hy-Vee Inc. grocery store at Kansas Expressway and Battlefield Road.

City officials entered into the Kansas Battlefield CID agreement on June 28, 2010, ahead of the West Des Moines, Iowa-based grocery chain’s construction of the 86,000-square-foot, $17 million store at 1720 W. Battlefield Road.

The CID collected a half-cent sales tax in the district to reimburse the developer’s public improvements required by the city. It was set up to terminate in 15 years or upon payment of the reimbursement costs, which amounted to $600,000.

Only problem, the developer met the reimbursement tally, but the CID continued to collect the sales tax to the tune of $225,200. City officials say the pace of repayment was much quicker than expected.

“This CID paid off the improvements in about four years,” said city Economic Development Director Sarah Kerner. “This is kind of a good news story.”

Council approved termination of the CID on Oct. 12, 2015. Prior, the CID funded public improvements including construction of West Montclair Street to the south of the store, a traffic signal at Battlefield and Kansas Avenue at the eastern corner of the Hy-Vee property, and new turn access off of Kansas Expressway.

The collections overage was discovered as the state auditor processed the CID closure, Kerner told council.

“The Department of Revenue only begins and ends taxes quarterly, so in order to ensure the full reimbursement, it ended up collecting inadvertently … before the tax was turned off,” she said.

Kerner said the Kansas Battlefield CID termination agreement included a plan for how any excess sales taxes should be distributed. The bill heard July 16 seeks approval for the city’s Public Works Department to spend the transferred funds “to benefit the real property which was formerly a part of the district.”

“We now have the funds and Public Works has compiled a list of projects,” she said. “They have more projects than they have money. But they want to be ambitious, if they happen to get low bids.”

Public Works officials have presented 13 potential projects, which range from adding fiber optic communications on Battlefield, estimated at $80,000, to $30,000 in stormwater improvements and $2,500 for flashing yellow turn signals.

The funds are expected to cover only the first eight prioritized projects.

“The idea is to bid the projects in order of priority until all the money is spent,” Kerner added.

No members of the public addressed council on the matter.

Tight parking
Two Springfield businesses are seeking to expand their parking lots – located at opposite ends of the city.

In the southeast quadrant, Acacia Spa received approval to rezone 0.42 acres at 4058 S. Lone Pine Ave. to make way for more parking. Located in Galloway Village, the area is the recipient of an infusion of development capital via the $14 million Quarry Town and $7.7 million Galloway Creek mixed-use developments underway.

Council’s decision will rezone the land behind the spa, owned by LowerDeck94 LLC, to general retail from single-family residential.

T-Mobile, in the northwest development Airport Plaza, would like to add a 2-acre parking lot to its call center operation. The proposal before council is to approve the final development plan with this change for the 66-acre Airport Plaza.

One member of the public spoke to council members, encouraging them to approve the request when they vote in two weeks. Zach Swartz cited the telecommunications company’s decade in the community and an employee count over 800.

“Given where we’re at in the economic cycle, we really need to support and strive to retain jobs in our community,” said Swartz, who works at BKD Wealth Advisors and is a member of the Springfield chamber’s The Network for young professionals. “This is especially important because T-Mobile and Sprint currently are in (merger talks) and we know, as mergers happen, cities are chosen for collaborate efforts with those companies. Certain cities will win and certain cities will lose.”

City manager contract
Council unanimously passed the employment agreement with incoming City Manager Jason Gage. Effective Aug. 1, contract terms supplied to council members show Gage will earn $220,000 a year in the job. Additional benefits detailed include a $5,160 annual car allowance, life insurance premium payments of up to $1,000 a year covered by the city on a $1 million policy, and retirement benefits in the state LAGERS plan with city contributions of the IRS maximum $18,500 per year.

Gage is moving to Springfield from Salina, Kansas, where he’s served as city manager for 13 years.