March 5, 2002

 

The Board of Commissioners of the City of Lawrence met in regular session at 6:45 p.m., in the City Commission Chambers in City Hall with Mayor Rundle presiding and members Dunfield, Hack, Henry, and Kennedy present.  

Mayor Rundle recognized high school students visiting from Eutin, Germany, a Sister City of Lawrence.

Mayor Rundle proclaimed Saturday, March 9, 2002 to be “Kiwanis Pancake Day”; and, the month of March 2002 to be “Mental Retardation and Developmental Disabilities Month.”

As part of the consent agenda, it was moved by Kennedy, seconded by Hack, to approve the City Commission meeting minutes of February 26, 2002.  Motion carried unanimously.

As part of the consent agenda, it was moved by Kennedy, seconded by Hack, to approve the Neighborhood Resources Advisory Committee meeting of January 24, 2002; the Housing Trust Fund Board meeting minutes of February 19, 2002; the Sign Code Board of Appeals meeting minutes of February 7, 2002; the Board of Zoning Appeals meeting minutes of February 7, 2002; the Convention & Visitors Bureau Advisory Board meeting minutes of January 8, 2002; and, the Mental Health Board meeting minutes of November 20, 2001 and December 18, 2001.  Motion carried unanimously.

As part of the consent agenda, it was moved by Kennedy, seconded by Hack, to receive monthly activity reports for December 2001 – February 2002, from Lawrence/Douglas County Economic Develop Board.  Motion carried unanimously.

As part of the consent agenda,it was moved by Kennedy, seconded by Hack, to approve claims to 237 vendors in the amount of $2,315,973.84.  Motion carried unanimously.

As part of the consent agenda,it was moved by Kennedy, seconded by Hack, to approve the purchase of utility billing remittance processing software, equipment, and service agreement for the Finance Department from Creditron in the amount of $51,523.  Motion carried unanimously.                                                                                                                                   (1)

The City Commission reviewed the bids for Project No. 15-SS6-201(BD) Westwood Hills –Baldwin Creek No. 2, Sanitary Sewer Improvements for the Public Works Department.  The bids were:

As part of the consent agenda, it was moved by Kennedy, seconded by Hack, to award the bid to McLouth Excavating, in the amount of $1,196,437.80.  Motion carried unanimously.                                                                                                                                           (2)

As part of the consent agenda, it was moved by Kennedy, seconded by Hack, to place on first reading Ordinance No. 7506, establishing the quorum of the Lawrence City Commission at four members, effective March 31, 2002.  Motion carried unanimously.                                      (3)

As part of the consent agenda, it was moved by Kennedy, seconded by Hack, to place of first reading Ordinance No. 7507, establishing “STOP SIGNS” on Westbrooke Circle at Westbrooke Street and on Petefish Drive at Westbrooke Street, all on K.U. property.  Motion carried unanimously.                                                                                                                             (4)

Ordinance No. 7503, amending Chapter 5, Articles 801-805, concerning the regulation of swimming pools, was read a second time.  As part of the consent agenda, it was moved by Kennedy, seconded by Hack, to adopt the ordinance.  Aye:  Dunfield, Hack, Henry, Kennedy, and Rundle.   Nay: None.  Motion carried unanimously.                                                                   (5)

Ordinance No. 7474, annexing approximately 13 acres of right-of-way along North 1400 Road (Douglas County Route 422), generally located east of Noria Road, was read a second time.  The annexation was required as a condition of the Final Plat of East Hills East No. 2.  As part of the consent agenda, it was moved by Kennedy, seconded by Hack, to adopt the ordinance.  Aye:  Dunfield, Hack, Henry, Kennedy, and Rundle.   Nay: None.  Motion carried unanimously.                                                                                                                                           (6)

Ordinance No. 7504, establishing special assessments for improvements to Kasold south of Clinton Parkway and Clinton Place was read a second time.  As part of the consent agenda, it was moved by Kennedy, seconded by Hack, to adopt the ordinance.  Aye:  Dunfield, Hack, Henry, Kennedy, and Rundle.   Nay: None.  Motion carried unanimously.                                    (7)

As part of the consent agenda, it was moved by Kennedy, seconded by Hack, to receive an annexation request from Francis Kelly for property the City is seeking to purchase; and, refer the request to the Planning Commission.  Motion carried unanimously.                              (8)

As part of the consent agenda, it was moved by Kennedy, seconded by Hack, to receive a letter from Brook Creek Neighborhood Association concerning the renaming of streams and watersheds in Lawrence; and, refer to staff for a report.  Motion carried unanimously.        (9)

Sandra Day, Planner, presented the staff report for a site plan (SP-06-39-01) for the Dillon’s Fuel Facility No. 68, located at 3000 West 6^th Street.  She said Condition No. 6 and 8 were revised and the applicant indicated that they were in agreement with the revisions.  Staff also received comments from residents that objected to the site plan because they were concerned about the additional traffic.  Before this item was brought before the Commission, a Traffic Impact Study was completed and the study identified additional improvements to the adjacent roadway that needed to be completed which was reflected as a condition of approval.       

Mike Berry, Professional Engineering Consultants, speaking on behalf of Dillon’s, said they were in agreement with the conditions of the site plan.           

Moved by Henry, seconded by Dunfield, to approve the site plan (SP-06-39-01) for Dillon’s Fuel Facility No. 68, located at 3000 West 6^th Street, subject to the following conditions:

1.                  Execution of a Site Plan Performance Agreement;

2.                  Provision of a revised Site Plan to include a site summary in the following format:

a.                  Building coverage existing and proposed area;

b.                  Pavement coverage existing and proposed area;

c.                  Open space existing and proposed area;

d.                  Total pervious and impervious coverage existing and proposed;

3.                  Provision of an amended Traffic Impact Study to correct errors noted by staff for record copy;

4.                  Provision of a revised Site Plan to show a raised curb line along the parking stalls at the east end of the proposed fuel pumps and provision of a raised landscape island located at the south end of the two parking rows east of the Lawrence Avenue driveway;

5.                  Execution of an agreement not-to-protest the formation of a benefit district for sidewalk improvements along Lawrence Avenue;

6.                  Provision of a note on the face of the Site Plan that states, “KDOT reserves the right to re-examine if problems arise with the fueling positions in place.”

7.                  Provision of a revised Site Plan to include a separate left-turn lane with 75 feet of storage for the southbound approach at the intersection of Lawrence Avenue and the Dillon’s driveway; and,

8.                  Execution of an agreement, which states that occupancy of the proposed fueling station, shall not be permitted until the Lawrence Avenue public improvements are completed. 

 

Motion carried unanimously.                                                                                                         (10)

Debbie Van Saun, Assistant City Manager, presented the staff report on the proposed lease agreement with GUT Works, LLC for the rental of City owned hangar-manufacturing facility at Lawrence Municipal Airport.  She said staff had one concern, which was the payment of the property tax for the building and needed input from the City Commission.  Although the building was owned by the City of Lawrence, the building was used by a non-City entity and therefore, the City was assessed property tax.  She said the representative from GUT Works did not want to pay this tax so the matter was brought back to the City Commission for review.

Mayor Rundle asked what was the basis for figuring the repayment of the renovation costs.    

Van Saun said the $395,000 balance was the amount of the construction cost for renovation, less than the amount that Dreamwings needed to pay which was approximately $60,000.

Ron Renz, President of GUT Works LLC, said they had been working on this project and had achieved a substantial agreement on the terms of the lease with the exception of the property tax issue.  The City had issued a request for a proposal and the request had specific lease terms for negotiations.  He said property taxes were not included in that list.  If staff intended to include property taxes, the taxes should have been included in the proposal because these taxes were a substantial difference.  He said GUT Works assumed that taxes were paid by the City.  The proposal included specific terms and a reiteration with some minor modifications of specific lease terms. 

Renz said the City Commission gave staff specific direction to negotiate this lease at the November 13, 2001 meeting, and to negotiate the lease with respect to the proposal that GUT Works had submitted.  Staff had chosen to insist that the property taxes on the building be paid by GUT Works.  He said GUT Works was working on sensitive capital negotiations, which would be completed tomorrow if the lease were approved as GUT Works proposed.  He said GUT Works was prepared to sign the lease immediately and begin employment.  If the City did not approve the lease as proposed he was directed by GUT Works’ investors not to close the deal.  

Commissioner Henry asked Renz if the proposed rent arrangement was submitted with the proposal or some other time. 

Renz said the costs that were in the proposal were costs that were in their financial proposal for the corporation.  They were costs that would allow the business to grow and allow employment for their corporation.  He said GUT Works looked at the building from a user’s standpoint and did not think that it was enough of a facility to justify a higher lease payment.

Mayor Rundle asked what would happen if GUT Works did not plan to locate in Lawrence.

Renz said one possibility was that GUT Works would go out of business.  Another possibility was that they would move to San Antonio because they were negotiating with a group that wanted to do some significant work with GUT Works.  He said if the deal went through with this group, it would significantly increase the work they would be doing in Lawrence.  He said they could possibly become one of the premier aircraft prototyping facilities in the world and would like to bring this facility to Lawrence, Kansas.  He said this idea was a long way off, but it was what they were working on to make their company profitable and to bring work to Lawrence.  He said if they could not do business in Lawrence business would be done somewhere else.

Mayor Rundle asked if they were planning on providing training in addition to the manufacturing.

Renz said their current business model was slightly different from what they proposed in November 2001.  He said their company was significantly impacted by the events of September 11, 2001.  Many of their customers, as well as capital investors, had been affected but they were willing to stick by GUT Works because they believed GUT Works had a sound business plan.   He said they were working with all of the suppliers of the program in California, Oregon, and Idaho to make sure there was a plan that was sound from a financial and technical standpoint.  

Mayor Rundle said he was supportive of this project and did not want to jeopardize the project.

Commissioner Henry said he was struggling with this issue because there were other tenants at the airport that paid property taxes; however, the other tenants’ rent was somewhat less.  He said it had been suggested the City pay the property tax as any property owner would.  However, the property owner who rented the property sets the rent as to what was needed to recoup the investment cost, pay the upkeep, and protect their interest.  He said the prior tenant was paying a substantial amount of money but failed, therefore, the City has not received any rent.  If there was no tenant and no rent, the City’s interest was not well served.  He said he understood that it would take approximately five years for a company to grow so that it was productive and profitable.  He suggested that Assistant City Manager, Debbie Van Saun, create an agreement for GUT Works to pay the property taxes, but receive a rebate of the rent to be consistent.  He suggested no rent the first year, twenty percent the second year, and thirty percent the third year.  He said this would provide the company an opportunity to get on its feet.  He said in retrospect, he thought there needed to be more creativity involved because he wanted to see GUT Works stay in Lawrence and be productive and profitable.

Commissioner Dunfield said the issue of setting a precedent for the City paying property tax for a particular building was why this issue was before the Commission.  He said he appreciated Commissioner Henry’s and Mayor Rundle’s comments that they wanted this company in Lawrence.  He said a building that had no tenants would not generate any revenue for the City and the City would be paying those property taxes anyway.  He said he was wondering if there was a way to forgive property taxes for a period of time.  He said, as he looked at the way the lease agreement was structured, there was a significant increase in the anticipated income generated by the company over a five year period.   He suggested the Commission look at this issue as a startup period which the City could help out by forgiving those property taxes for a five year period and then have the company start paying taxes after that time, assuming the company was meeting its projections and able to absorb that extra cost.

Commissioner Hack concurred with Commissioner Dunfield.  She said her concern was that this was an area that was growing and needed to be utilized.  She said it might be a good idea to develop a policy.  She supported the proposal.                     

Mayor Rundle said he wanted to comment on the Request for Proposals.  He said the Internet had information about crafting a Request for Proposal so the proposal was complete at the time it was issued.  He said he thought the City had a slight misstep on this proposal even though staff did not agree these taxes were something that was omitted.  He said the City was setting a precedent that when there was a major item that was left out of an RFP, the City could bring this item up later, and he did not think that was a good policy.          

Commissioner Kennedy concurred with the other Commissioners.  He said the City had a chance to lease a vacant building and establish a business that had interesting growth potential.  The Commission needed to encourage businesses for expansion of the airport because it would incur growth and good jobs for the community.  He concurred with Commissioner Dunfield concerning forgiveness of taxes for a five-year period.              

Mayor Rundle asked Commissioner Kennedy if he suggested reopening this issue for negotiations after five years.

Commissioner Kennedy said “yes.” 

Renz said if you look at the rent that was proposed along with the escalation clauses, one of the reasons for this clause was to share their success with the City.  This was why they proposed several options, one of which there would be no escalation and one that was.  If you look at the difference in the monthly rents, with and without the escalation that was proposed, it far exceeded what the property tax was.  He said if they owned the building and had to pay property taxes, they would come to the Commission for property tax abatement like many other businesses in town when they made capital investments.  One of the reasons for the escalation clause was to try to come to a situation that was similar.  The difference between the first year rent and subsequent rent far exceeded the annual property taxes.            

Mayor Rundle asked Renz about the options of their proposal.

Renz said the original option was a fixed-lease amount of $1,550 a month.  Option B, which they preferred, included no rent for the first six month; $1,550the next six months; and, an escalation clause, based on the number of employees, capped at $2,170 a month.  The difference was almost $600 a month in escalation.  The property taxes were approximately $5,000 a year which was approximately $400 a month.  The escalation clause was already significantly more than the property tax. 

Commissioner Hack asked Renz when did GUT Works make the lease proposal and did the proposal come with his response to the RFP.  

Renz said “yes.”

Commissioner Hack asked Renz if rent was requested in the RFP.  She said the information that she was provided was financial qualifications, a schedule, and references.  She asked if the RFP requested rent in the proposal.

Renz said as he looked through the proposal, he thought that was correct.  He also said he thought GUT Works submitted a complete proposal.

Commissioner Hack said taxes were where the confusion was because the rent was not requested in the RFP, but GUT Works included rent in their proposal.  There was no clear instruction on either side as to include or not to include property taxes. 

Renz said the City’s proposal, contained specific items the City wanted to include in the lease including: utilities, maintenance, fire protection, insurance, parking, financial qualifications, a schedule of entering into the building, and financial references.  The lease terms stated that GUT Works would pay all utilities, which was specific and included that GUT Works, as a lessee is responsible for the day-to-day maintenance of the furnace system.  This was a much less significant item than the property taxes.  If the property taxes were going to be included, then why did they include something that was significantly smaller than property taxes?  He said the City did not state that they were responsible for the property taxes; therefore, by omission the City did not want or need it to be addressed.  He said they did not omit addressing property taxes because they overlooked it, they thought about it and was the reason for the escalation clauses.  He said the terms in the lease were specific and the property taxes were not included.  If this was an oversight by City staff, it was not GUT Works’ fault. 

Mayor Rundle asked Renz to address Commissioner Henry’s concern.

Renz said he tried to respond to Commissioner Henry’s concern by addressing the escalation due to the property taxes in GUT Works’ rent. 

In response to Commissioner Kennedy’s comments, Renz said the RFP asked for a fifteen-year lease term.  He said GUT Works responded with a twenty-year lease term for two reasons: 1) GUT Works wanted to show that they were making a significant commitment to the City; and, 2) GUT Works was willing to make sure the City was made whole on the building.  By the time they did financial calculations with a fifteen-year term, GUT Works could not show that the City had paid for the building.  He said they wanted to show in their proposal that they were prepared to have the City come out whole with the twenty-year lease proposal.

Renz said, in response to Commissioner Dunfield’s proposal of a policy, there should absolutely be a policy.  If you look at the buildings at the airport, there was not a single City owned building that paid building property taxes.  There were buildings at the airport were on the property tax roll but they were all privately owned buildings.      

Henry said that was inconsistent with what he was led to believe.  He understood that private tenants of City-owned buildings at the airport were paying taxes.

Renz said there was no City owned building where the tenant paid property taxes.  He reiterated that there were buildings at the airport where property taxes were paid but the owners of those buildings paid them.  Those private businesses included Don’s Diesel, Great Plains, and Al Stuber.

Mike Wildgen, City Manager, said when Dreamwings occupied that building it was a taxable building.  He said it was a City owned building, but if there was a non-public use of the building it was looked at differently by the County.  He agreed with Renz.

Mayor Rundle said even if you looked at this issue as a tax abatement request, it penciled up better than many other tax abatements in terms of repayment.  He said one mechanism that was suggested was to address this issue in five years for negotiations.

Renz said he preferred not to address the issue in five years because it has taken him four months to negotiate what he thought was a done deal.  He said he did not want to come back because it has cost him significant dollars in legal fees as well as the City’s time and manpower.  He said he believed on November 13, 2001, the City Commission gave staff specific instructions.  He said they had worked with City staff and tried to meet all the additional terms that the City threw on them that were not included in the RFP.

Larry Kipp, Lawrence, said he was interested in small businesses in Lawrence.  He suggested that the City establish some type of incubator entity that in some instances take an equity interest in the company. 

Mayor Rundle said this sounded like a good model, but not this late in the game.

Renz said the City did have an incubator entity called Kansas Innovation Corporation.  Kansas Innovation Corporation was one of the members of their corporation.  The capital investment that GUT Works was doing was going to help Kansas Innovation Corporation as well as themselves.  He said Kansas Innovation Corporation was hurt by Dreamwings and that was one of the reasons KIC had problems at this time.  They had assets that were part of Dreamwings that they now own and were in that building.  If this deal goes through and GUT Works gets their capital investment, they would purchase those assets from Kansas Innovation Corporation at more than they could get at an auction. 

Renz proposed that the City pay the property tax for the first twelve months, which, he said, was sort of in their proposal already.  For months thirteen, and each month thereafter, the City would reduce the rent by 1/12^th of the current annual property tax amount.  He said GUT Works would take the risk if the property taxes go up starting with month thirteen and beyond.  He said a precedent was not being set.  GUT Works would be paying property taxes, yet they would be able to get the deal that they proposed in the first place.

Mayor Rundle said either way was okay because it was not a significant tax abatement compared to the tax abatements the City had given to other businesses.

Renz said the tax issue dealt only with the property tax on the building.  They had always agreed to pay the personal property taxes on any equipment they own. 

Commissioner Dunfield said he was prepared to make a motion that the Commission direct staff to modify the lease agreement per Mr. Renz’s outline so that the property tax was covered, and reduce the monthly amount of the rent by the amount of property tax this year.

Mayor Rundle said, given the amount of staff time that was spent and the amount of money saved, he thought staff time could be spent more productively in ways that are more beneficial to the City.  He said staff should be more productive, and look for ways to realize more efficiencies in our budget, and we should motivate our staff to be enthusiastic partners with the City Commission. 

            Moved by Dunfield, seconded by Rundle, to direct staff to modify the proposed lease agreement with GUT Works, LLC to provide that the City would pay the property tax for the first 12 months of the lease and, for the remaining months on the lease, the proposed monthly rent would be reduced by 1/12 of the 2001 annual property tax amount.  Motion carried unanimously.                                                                                                                                                       (11)

David Corliss, Assistant City Manager/Legal Services Director, presented the staff report on House Bill 2828, proposed Douglas County sales tax.  The bill would provide the County with the authority to put before the voters of Douglas County the opportunity to vote on a .25% sales tax for the purpose of preservation, access, and management of open space and for industrial and business park-related economic development.  He said he had discussions with Evan Ice, County Counselor, about some of the legal aspects of the language.  In addition, ECO2 met to review the bill.  ECO2 recommended deleting Section 3 of the bill.  Section 3 would allow Douglas County to keep all the revenue.  By deleting that section, the statutory formula that provides for the distribution of the revenue to the cities in Douglas County would apply. 

Corliss said Commissioner Dunfield had a question at a previous meeting concerning the turnaround day and the longevity of the bill.  He said the bad news was the turnaround day had already passed.  The good news was that this was a bill introduced by the House Taxation Committee, which meant it was alive for the entire legislative session.  He said he thought there would be an omnibus sales tax bill.  It was important that the City Commission indicate to the legislative delegation whether it wanted to take a position on the bill, and if so, what its position was.

            Kelvin Heck, ECO2 Co-chair, asked for City Commission support for the opportunity to get this issue in front of the voters.  Heck said this was not saying “yes” to a sales tax, but giving people a chance to vote on the sale tax issue. 

            Mayor Rundle said it was necessary to go to the legislature because the City Commission did not have the authority for this tax and the tax issue would be brought before the voters.  Rundle said sales tax was an important topic among citizens. 

            Commissioner Kennedy asked Corliss if this tax issue would come before the City Commission again and then go back to the voters in November. 

            Corliss said if the bill became law, Douglas County needed to decide when they wanted to put the tax issue before the voters.  He said the County might chose this November if that worked for their planning purposes since this was a general election and not a primary election issue.  He said the City Commission should anticipate an Interlocal Agreement between the City of Lawrence, and hopefully other cities, and Douglas County.  

            Moved by Kennedy, seconded by Hack, to direct staff to prepare a letter to the Lawrence legislative delegation, for the Mayor's signature, expressing support for the proposed changes to House Bill 2828 (the proposed Douglas County sales tax (ECO2).  Motion carried unanimously.                                                                                                                                      (12)

David Corliss, Assistant City Manager/Legal Services Director, presented the proposed agreement with Home Depot for the construction of public improvements on Iowa Street, 31^st Street, and Ousdahl Road.  The most recent agreement was attached to a Dan Watkins memo dated March 4, 2002.  He said the Commission had already adopted and approved the rezoning ordinances for the property earlier this year.  The City Commission had also already approved the Preliminary Development Plan for the project with a number of conditions, and not all of those conditions had been met. 

Corliss said one of the conditions in the Preliminary Development Plan was the cost sharing or road schedule agreement and who paid for the public improvements that were necessitated by this project.  The public improvements were road, sidewalk, and traffic signal improvements.  He said when this issue was discussed two weeks ago, he outlined the scope of the agreement.  The agreement reflected the changes in the cost allocations that the Home Depot developer had agreed to.  It reflected a cap on the total City expenditures, and it removed the assignment language that some had concerns about.

Corliss said if the Commission proceeded with the agreement they needed to waive the bidding requirements.  Because the Home Depot developer decided to pay all costs for the improvement of Ousdahl both north and south of 31^st Street, there was not an issue of declaring Ousdahl as a main trafficway.  He said in order for the City to debt finance road improvements, the City needed to look at state laws.  This was not a benefit district which allowed debt financing of roads. The only other statute that the City used was the main trafficway statute.  The only requirement was that the City Commission would have designated that road a main trafficway.  Since the developer had taken that issue off the table then the Commission did not need to designate Ousdahl as a main trafficway for dept financing purposes. 

Corliss also said the City Commission would need to approve a resolution because the dollar amount had fluctuated.  He said the Commission would need to approve a resolution under the main trafficway statute for 31^st Street and Iowa because those were already main trafficways in order to finance the public improvements.  Once that resolution was adopted, then it would give the City the authority to debt finance the City’s portion.  This was a condition of the development plan in that the City had an agreement for payment of public improvements. 

Corliss said there were a number of design issues that reflected access and traffic flow issues.  He said it was important to remember that this was a design/build agreement and there were no final construction plans for this road.  The City had a good handle on the scope of the road but did not have the final construction plan.  This agreement required City approval and also required that the City approve the construction bids.  When the bidding was conducted, the funds were escrowed with the City as the escrow agent.

Corliss said Todd Thompson had a question about the language in the agreement that when public improvements were completed, the escrow agent paid all the retained funds to the developer.  This referred to the fact that under the agreement, five percent of the contract cost was retained by the City.  When those improvements were completed they were then paid to the contractor.  He said he believed the language still worked for what the City was going to do.  It was clear in the agreement how much money the City would allow since the City’s portion was capped.  

            Dan Watkins, attorney for Home Depot, reviewed the work schedule agreement.  He said last fall the improvements for 31^st, Iowa, and Ousdahl were estimated to be about 2.2 million dollars.  The cost and improvements had expanded approximately fifty percent to 3.3 million dollars.  Watkins said they had worked closely with City staff and KDOT to develop a scope of design that said exactly what was going to happen.  KDOT said, for example, that they did not think there should be eleven-foot lanes for the double left turns on Iowa and that this shouldn’t be done without a raised median.  He said they would like a raised median, twelve-foot lanes and fourteen foot receiving lanes on the streets that the double left turned onto.  KDOT thought the lanes should be balanced on both sides of the intersection east and west.  Based on widening west of Iowa, the cost went up $300,000.  Based on widening Iowa north and south of 31^st Street, the cost went up about $400,000.  He said the City would like a twenty-year pavement design that was well beyond the pavement design that was in the proposal for 2.2 million dollars, so approximately $400,000 was added east of Iowa.  There were also discussions on how it should be allocated.  They also incorporated into the design a protective left turn for K-Mart, which created the need for additional room and some additional cost.  As a result, in order to do final plans, you have to have a scope of design. 

            Watkins said they also talked about the fairness of the amount of increase on Iowa Street and the City was paying one hundred percent so they looked at sharing that cost.  Also in the course of this proposal, KDOT looked at the design and said what their requirements were, and how they would participate.  He said they started out by participating with federal safety funds or an offer to participate with those, which would have required a separate project at Iowa.  The requirement of improvements west of Iowa caused the need for additional funding.  In looking at that, the developer would participate and share the cost with the City as opposed to a benefit district.  Watkins said they had come to an agreement with KDOT and City staff on the scope of design.  The developer was comfortable with the $1,340,000 share proposed for the City, which would be capped, and hopefully the cost would be lower.  The cost right now had a twenty percent contingency which included approximately eight percent for design.  In any event, when the bids were in, the City would pay $1,340,000 on $3.3 million worth of improvements.  The developer would be paying approximately fifty percent, or approximately $1,600,000; and KDOT would pay $300,000.  He said they believed staff was comfortable with the scope of the design and the cost that was incorporated could be met within the City’s cap. 

Watkins said it has taken three years to get to this point.  The concept of the zoning, site plan, and approval process was arrived at with the City agreeing to invest $1,100,000 to participate in the needed public improvements.  The partnership would allow a substantial improvement.  He said they had tried to minimize the City’s increase in cost as the project has gone up in price.  The reason it took a long time to get to this point was they were trying to resolve access and traffic issues.  He said this project could take a substantial step forward in addressing those problems.  He said a few years ago Malan Realty agreed not-to-protest the traffic light at their entrance.  He said the first year they worked on a traffic study trying to develop a plan that would put a light at the Malan Realty entrance.  He said they had met with KDOT and City staff.  The physical constraints and the volume of traffic would not allow that light to be approved by KDOT.

            Watkins said the other issue was the landowner on the northeast corner where the gas station was wanted the traffic light at that location too because it would serve his corner.  As they couldn’t develop that access point, it moved to mid-block.  He said he knew there were concerns about the standards of how far apart stoplights should be and those standards were there for a reason.  These standards exist to make traffic move smoothly and certainly on a U.S. Highway the lights were timed to keep the traffic moving.  He referenced the traffic light at 34^th Street, which was at that location for a reason even though it violated the standards. 

Watkins then made an analogy between traffic and the human circulatory system.  He said there arterials, collectors, and smaller streets which were a lot like arteries, veins and capillaries.  He noted the infrastructure in the South Iowa area and said there was one true area that was a reverse frontage road for collectors.  That reverse frontage road exists on Ousdahl, south of 31^st Street to 33^rd Street out to Iowa.  He said to imagine that sort of system going west on 33^rd, behind Target and out to 31^st Street.  It would work a lot better than what was presently there.  He said to imagine Ousdahl going north to 29^th or 27^th Street and being able to let out that circulation.  The 34^th Street light happened because there were lights at 31^st and 33^rd Streets.  He asked what happened to 35^th Street.  There was not an outlet at 35^th because of the trafficway.  The theater, Penny’s and Payless traffic would all be forced up to 33^rd Street.  When you have outlets every two blocks you can have a light every two blocks.  When you don’t have an outlet at that second block, it made sense to have an outlet in the middle.  He said the same thing has happened to this project.  There was no circulatory system that supported this.  He said at a neighborhood meeting, Chris Huffman acknowledged that the mid-block light was needed to handle this project.  It was also needed to allow access to the Post Office. 

            Watkins said another reason this project was taking a while was because when they first proposed the light at that location, they thought that light should serve both the Post Office and K-mart.  The Post Office did not want to adjust their circulatory system, but they thought it was a possibility.  He said the light could serve more than just the Post Office.  He said they had done a detailed traffic study with additions to the traffic study to refine it and included the traffic on the Commerce Plaza redevelopment.  He said in order for that corner to have reasonable access, it needed to come from that mid-block light.  If Ousdahl was the only light and access point, there would likely be access control all the way from Iowa to Ousdahl because it was a big street and there would be a lot of lanes.  There was an outlet at 29^th Street and everyone acknowledged that outlet was not well designed.  The main access to this site was going to be from 31^st Street.  He said there was no access into this particular site at all other than further north and it was limited.  When you look at other properties as you go south, Malan Realty for instance, they have access at 31^st and 33^rd Streets.  This was going to restrict some of their access out of Malan Realty going west on 31^st Street; otherwise, they would have similar access as they had today other than the ability to turn left out of their two 31^st Street entrances.  Malan Realty also had another way out; they had a signal at 33^rd Street.  There was a back frontage road down Ousdahl and across 33^rd Street.  The infrastructure was there to provide better circulation than you would have for this site.  He said there were limitations in our system.  If we had some of these reverse frontage roads the pressure would be greater for more commercial development. 

He said what they had come up with was a major improvement that improved 31^st and Iowa Streets and would handle the traffic that was at a low level of service today.  He asked the City Commission to look favorably on this issue.  He said they had been working for three years to try to address all the issues that had come up to the best of their ability and work with all the players involved.  He said they were willing to continue to work with all the players to make this work and to bring a major benefit of the Home Depot Center to the Regional Commercial Center.  This was where the City designated the Regional Commercial Center to be and was where Home Depot believed would best serve the whole community.  He asked the City Commission to support the project. 

            Commissioner Dunfield said the fax the Commissioners received today from Watkins’ office had several bullet points and indicated the Home Depot developer would purchase the Commerce Plaza property.  This property was under contract to a company associated with the development.  He said this was the first time the City Commission had seen this confirmed and asked how long that contract had been there.

            Watkins said April of 2001.  The contract was entered into originally before the first vote on the larger proposal with the twenty-five acres that extended to Ousdahl.  When that was defeated, there had been discussions and negotiations between the developer and the owner of the Commerce Plaza area to try to restructure that agreement to reflect the small commercial area.  There was an October 26^th letter from Peter Dellaportas to the City Commission regarding these issues basically stating they had kept the contract in force by making monthly payments.  At this point, they did not have any choice.  They had a condition that had to be met to provide access and a contract that allowed them to do it. 

            Commissioner Dunfield said clearly Dellaportas had been interested in acquiring this property for a long time.  If the contract dated to April, presumably there were discussions that predated that by several months.

            Watkins said “yes.”  There were discussions prior to that and extended discussions with the previous owner to try and purchase the property from him as well.  They had to address the access issues and all the planning issues with taking all the factors into account.  Watkins said the first owner said they wanted a storm water hookup and an access to the light, but did not want to pay a penny.  Watkins said fine.  This was exactly what has happened and what had transpired today.  This project was paying for the development of that corner.  He said they really did not have any choice but to buy it at that price and that was what they intend to do.

            Mayor Rundle said when the City Commission considered this issue in the fall, he said he did not find the need for the entrance in the middle of the block and the light very compelling.  He said he wanted to remind the Commission that in 1991 the Commission passed a policy that there would be no more curb cuts on 31^st street, and that the Comprehensive Plan also had that requirement.  Rundle asked if there were any other Home Depots that had a mid-block stop light.

            Watkins said he could not point to any stores that had the restricted access.  Most places have more then one way in and out and Ousdahl provided that.  This was a situation about trade offs in that there were two curb cuts close to Iowa on 31^st Street that were going to be closed.  Watkins said, in dealing with the physical reality, there was an ideal situation of having a reverse frontage road like Malan Realty, which was down Ousdahl, out 33^rd Street, up Iowa and down 31^st Street.  Ideally, if you had a frontage road around there, then what would be encouraged was for commercial to be within that whole area, and they did not want commercial going to Ousdahl or north of 29^th or 27^th Streets.  Watkins said they had tried to design something and take it through the process, which included fairly high standard engineers at the City, and people with high standards at KDOT.  He said this was a traffic system that worked for a high volume traffic center.  When there is a circulatory system and limited arteries, exceptions need to be made.  He said they had made some exceptions because it was necessary.  A light at 34^th Street was an exception as well as a light at Nieder.   A light at mid-block, while it was an exception, was designed at the mid point to serve the Post Office and potentially K-mart.  He said there would not be a reverse frontage road on Ousdahl up to an outlet on Iowa that served this in any meaningful way.  It was not going to go to 27^th or 29^th Streets any time soon.  The reason why it was there was because it best served the site.  He said they had tried to come up with the best solution that all of the site, access constraints, U.S. Highway and the infrastructure allowed.   Watkins said that KDOT and City staff had agreed to it all. 

            Mayor Rundle said it was unfortunate that if the City let this develop where all of that could have been taken care of before hand.  He said he thought that the City had to settle and retrofit.  Rundle also said that while taking care of access to this new site just about everybody on the other side of the street was somehow losing some of their accessibility.  So that trade off was also there.

            Watkins said there were trade-offs, and one of those trade-offs was an opportunity that K-Mart and the Post Office could share a light that they wouldn’t otherwise.  If you take the light out of the mid-block then you were going to penalize the Post Office and penalize the corner that had a fueling station that was losing its two access points, to have to go all the way to Ousdahl and work its way back through a parking lot of a development because there was no reverse frontage road around the north.  He said he thought this was the best solution for this particular site.  The traffic studies bare it out and had worked hard to come up with a solution for Malan Realty to not penalize them more then they had to be penalized.  The solution, if you go all the way to Ousdahl, was a median and limited access to everybody on the south side.

            Joyce Wolf, Chair, Indian Hills Neighborhood Association, said although they appreciated the applicant’s efforts to address the initial drainage issue, which was solved, they still thought there was an inordinate amount of City involvement financially in this project.  Wolf said one of the options KDOT shared at the program was that if Home Depot were not going to be there and everyone recognized 31^st and Iowa Streets needed help, that KDOT would be willing to put $300,000 into the restructuring and realignment.  The City’s share would be $50,000 compared to the 1.34 million that was now being asked. 

            Wolf said it appeared that this still was aligned to face 31^st Street.  With the three lights spaced so closely together, it was going to be almost impossible to get those lights timed adequately.  What was predicted was that traffic would back up along 31^st Street at those lights and at the turning lanes.  Wolf asked if it would be a possible scenario that if people become discouraged about the amount of time it took to get through the intersection, would they in fact come down the over burdened Louisiana Street or would they make a right hand turn on 27^th Street and turn a collector street into an arterial street.  Wolf said they lived within a block and a half of 27^th Street, and it took a lot of traffic.  She presented a chart which looked at the population trends, north of 31^st and east of Louisiana.  Wolf said their primary concern was cost to the taxpayers.  She said they thought they could get the intersection itself figured out with less money from the City.

            David Geyer, Lawrence, wondered, from a taxpayer’s standpoint, if the cap on this was actually $1.64 million because that was the tax money from the State too.  Both amounts would bring taxpayers up to even with the developer.  Geyer asked what was the best deal for taxpayers who were in Lawrence and the State of Kansas on this intersection.  He said he also recommended that the City start looking at the rest of the land use along 31^st Street to see if they could attempt to prevent the overloading of this intersection even more, no matter what the decision was tonight.

            Todd Thompson, attorney for Malan Realty, said he spoke to each Commissioner over the past couple weeks to try and state Malan’s position.  Thompson said he would like to note that Watkins stated that the drawings that had been submitted were “exactly what is going to happen.”  The drawings showed the eastern most Malan Realty entrance/exit as being closed off entirely.  He said they had been told that it was going to be left open, but the reality was, they did not know what was going to happen.  If there was a stop light in the middle of the block, that eastern most drive would not work with the stop light being that close to it.  In terms of access to the site, he found it interesting that going to Ousdahl and around was okay for K-Mart customers to have to drive through a parking lot and other developments, but Ousdahl was to far away to serve the site on the north side of the street. 

Thompson said it was stated the reason why the stoplight was there was because it best served the site.  A mid-block stop light as proposed on the drawings that were submitted to the City Commission clearly served the site on the north side and all to the detriment to the south side of the street.  On behalf on Malan Realty, he asked the City Commission to review the site.  He said when they redeveloped the Malan site, they did not ask for a double left turn lane stop light on Iowa Street and in fact, thought the City would laugh at that notion.  He said they paid for the improvements on 31^st and 33^rd Streets and would like the City to reject the pending agreement, drawings, and cost estimates that were presented.  He said these were new proposals and it was the first time the City Commission was considering the proposals.

            Carol Bowen, Lawrence, asked the City Commission to think about big picture transportation planning in Lawrence.  The City did not have good circulations because of the way the City was laid out.  She said it would take a year or two, depending on the weather, for the intersection construction to be completed.  She said the construction would be completed in the year 2004 and would have an additional two years before the intersection would be dysfunctional again.  By 2010 the City would need a diamond intersection and she asked if the City was ready to address that type of intersection. 

            Pete Curran, attorney for Douglas County Bank, said there was a concern about a median which would be constructed west of Iowa Street on 31^st Street that would limit left turns into the bank at that location and also left turns out on to 31^st Street.  He said in 1994 Douglas County Bank acquired that property from the Harwoods, with the idea of establishing a branch bank at that location.  At that time, the property was serviced by Iowa Street frontage road and had access to 31^st Street.

            Curran said in 1996 the bank acquired site plan approval to build a branch bank.  At that time KDOT and the City required that the existing frontage road be vacated and also limited access onto 31^st Street to where it was presently located, a three-lane entrance and exit.  He said they were required to be so many feet from Nieder Road and Iowa.  That point of main entrance to the bank’s facility became fixed at that time.  He said in this type of business, a branch bank was primarily dependent upon a good flow of vehicular drive through banking practice.  If there were impediments to get to the bank, it threatened the economic viability of that operation.  The Douglas County Bank was not opposed to the Home Depot Project, but was only opposed to the extent that the bank did not want to get hurt in the process. 

He said Douglas County Bank was asking the City Commission to give some type of direction that would help investigate ways that the bank’s ingress and egress by left turn in and out at that main entrance not be impeded or restricted.  He said his understanding was that Landplan’s first design connection with the Home Depot project was to have a raised median on 31^st Street, but not to extend to the point of restricting left turns in and out of this drive.  In the hands of KDOT, they wanted it extended more so that it did interfere with the in and out left turns.  He said Landplan thought that was consistent with proper traffic flow to not require this limitation for this entrance and exit from the bank.  He said the access to the bank from Nieder Road should be adequate; however, if they relied more on the Nieder Road access, that would actually cause another traffic problem because traffic coming from the east and north, that normally would come in this main access, would need to negotiate the intersection at Nieder Road, proceed south and then make a left turn into the bank property off of that two lane road.  The bank was willing to consider dedication of more right-of-way if it created a wider street which would provide for a right turn lane to the south. 

He said if the bank could get some direction from the City Commission that they would condition their approval of these improvements to working with Douglas County Bank to keep their access it would be greatly appreciated.

            Mayor Rundle asked Curran if he had received the explanation on why they made that recommendation from KDOT.

            Curran said “yes.”  He said they understood that to some degree the traffic problems that were supposed to exist in that area perhaps were somewhat exaggerated.  He said he thought that limiting the median to Landplan’s first proposal was suitable and workable.

            Bob Suderman, Lawrence, began with a quote from Chris Huffman, KDOT, that summarized what was being looked at as residents and taxpayers who were concerned about how we spend our money.  He said Huffman said, “The city was going to see, according to the studies, some fairly significant operational problems approximately in the year 2006.”  KDOT’s position was they expected a failure at that intersection (level D or below) at some point between 2006 and 2007, but it could come quicker.  If they finish the project in the year 2003, there were approximately three or four years and the City would be spending approximately 1.64 million dollars of the taxpayers’ money for this intersection.  Current traffic from the east side runs approximately 14, 000 cars per day which was two-way traffic and would approximately double.  He said 31^st Street from Kasold on out to Noria Road was also going to become an interesting road.  He said in their neighborhood, some people believed that they should have a bypass SLT on 32^nd, 38^th or 42^nd Street.  Regardless of the route, the City would likely see 31^st Street traffic increase dramatically when that hookup came to Noria Road.  This had not been factored in to the KDOT studies.  If the city was approaching breakdown with the traffic now, he asked what would happen when the City talked about a 31^st Street extension.  It was not good use of taxpayer money to spend money that would only last for three to four years and then add traffic that would overwhelm that same intersection and then turn around and do something dramatically more expensive.  He said he objected as a taxpayer.  If the City was going to get something that would last, it would be different, but that was not the case.  He said the short right turn being projected for the right side of 31^st Street on to Iowa did not solve the problem.  The City needed long right hand turns at that corner, not short 3 or 4 car length turns, and needed to be done before that project opened or the City would experience gridlock and road rage. 

            Suderman said one of the points Watkins made was that local roads carried local traffic.  Arterial roads should carry arterial traffic and each type of road should carry their own kind.  One of the criticisms of this project was that this project dramatically mixed up different types of traffic. There was a problem about multiple lights on 31^st Street that created the stoppage that were of concern to KDOT.  If the city did not approve the project and waited to see how the rest of the area developed, $300,000 would be available for safety considerations.  For $350,000 the City could bring that corner up to the standards that KDOT thought would carry the traffic load at this time.  This would give the City time to review this intersection. 

            Suderman said his neighborhood was never against having a Home Depot and had always argued that a Home Depot would be a valuable asset to the community.  He said the neighborhood had discussed alternative locations, for example, the developer had never discussed the Cornfield Mall Site.  In talking with KDOT about how they rank the current sites and how they could handle the traffic, 31^st and Iowa was in last place by far.  He said KDOT did not particularly like the site, but it could be made to work if the traffic signal was a half mile away.  Another site that was able to manage and handle the traffic at this point with improvement being planned was the site at 6^th and Wakarusa.  He said again, they were not concerned about where the Home Depot would go, but they were concerned about the safety issue.  He said the median issue did concern them.  He said the local businesses should be protected as much as possible, however, if this intersection deteriorated to the level that KDOT suggested, then the City would need to support extending those medians and that would hurt K-mart and Douglas County Bank.  He asked the City Commission to consider waiting on this project until more information was provided so the City could understand what the implications would be.

            Roger Flory, Lawrence, said he owned the Commerce Plaza Texaco Station at 31^st and Iowa.  He said he wanted to go on record that he was neither in support nor in opposition to the Home Depot project but he did have some concerns.  The Douglas County Bank discussed the fact that their left turn traffic would be cut off.  He said Commerce Plaza’s left turn lane would also be cut off in addition to their driveway.  There would not be an entrance to Commerce Plaza except for a temporary frontage road.  To limit their access to just the frontage road was a concern.  He pointed out that their driveway would be totally closed and his business would lose all the traffic coming from the west and leaving to the east, which would cut his business substantially.  He said he was not trying to judge the merits of the project.  The point was he was losing half his traffic along with his driveway. 

            Jim Turrentine, Lawrence, said he was there to talk about traffic.  As KDOT had said, the City Commission would decide the fate of 31^st Street.  KDOT could not decide what the demand would be on traffic.  He said it was the City Commission’s decision to decide what uses could be made and what the demands would be.  The City Commission’s policy controlled the demand for traffic on 31^st Street.  He said Horizon 2020 shows that it would only support a limited amount of demand and KDOT agrees.  He pleaded with the City Commission not to impede 31^st Street as a future east/west arterial.  The City needed a east/west arterial and anything on 31^st Street should be planned out in the future to allow it to become one. 

Turrentine said more traffic into a business meant more profit so the developers design intersections to maximize profit, but they also maximize demand on city streets.  The intersection between Ousdahl and Iowa was designed exactly that way for maximum amount of traffic into their facility.  He said the City Commission had the opportunity to do what was right for 31^st Street for all the citizens of Lawrence.  He said the City could save money and lives in the future on 31^st Street by making the right decision.  He asked the City Commission not to allow the intersection between Ousdahl and Iowa. 

            Turrentine said KDOT recommended greater spacing but it did not work on this type of street in that location and should not be allowed.  The City could save the cost by not having the intersection built.  All of the intersections on 31^st Street would be safer by not having this intersection.  He said the City could make the useful life of 31^st and Iowa a lot longer than 2006 along with saving a million dollars in correction costs that would need to be made in the future.  The developer, even under the revised plan, was only contributing approximately $100,000 to the intersection costs.  KDOT would provide eighty five percent of the correction costs and would correct all of the safety deficiencies. 

He asked if 2006 would bring on age of expensive interchanges on Iowa or would 32^nd Street be built as a one-way street to Louisiana to carry the traffic and 31^st Street might turn into a one-way east street.  To control the traffic, the city would need to build the reverse access from this site.  He said this developer did not propose to put reverse access off of Iowa around the back of his facility to relieve traffic off of 31^st Street.  The developer had a million reasons for this location, but the taxpayers also had a million reasons for putting this development at another location.  If this developer would not develop 31^st Street correctly, with respect to traffic and safety, he said he was sure the next developer would.  He asked the City Commission not to make 31^st Street like 23^rd Street.  He said the City Commission had the ability to prevent the Journal World prediction that this intersection was going to fail.  He said only the City Commission could lower design and demand and accommodate this situation. He asked the City Commission not to approve a design that promoted demand.

            Mayor Rundle asked Corliss to reiterate the action items concerning this intersection.

            Corliss said the improvements would still be made, but the City would not be participating in the financing so the City did not need to designate Ousdahl as a main trafficway and did not need to debt finance.  He said this was a requirement of the development plan.  He said the City Commission needed to act on the agreement and if approved, staff would draft a main trafficway resolution for 31^st Street and Iowa.  If there were amendments to the development plan, then a member of the governing body would need to initiate the motion to change the plan.  He said this would also change the structure of the agreement.

            Commissioner Hack asked Terese Gorman, City Engineer, to clarify the $300,000 proposal from KDOT and the additional $50,000 from the City and what type of financial arrangement would the City gain at that location.

            Gorman said KDOT contacted her before they knew about the Home Depot development to let her know that they had $300,000 of safety money.  The next intersection on the list that qualified for funding was 31^st and Iowa and KDOT asked if the City needed the money.  She said “yes.”  She said the City submitted accident reports for safety funding and KDOT had analyzed the City’s accident reports along with a cost benefit ratio across the state.  She said KDOT had identified, based upon accident history at this location, that all the improvements would be on the east leg of the intersection and would line the lanes up with the west side and there would be a slight traffic signal modification to accommodate the new lane alignment for an estimated $300,000. The City’s share would be ten percent, which was $30,000, along with hiring the engineer to do the design which was approximately $30,000.  This was not to improve the whole intersection it was only to improve the east leg to correct the accident problem.

            Commissioner Kennedy said the City had been asking for this money since he has been a commissioner.  He asked if the $300,000 was earmarked and would it include a right turn lane.

            Gorman said “no.”  It would only allow for the lane alignment, which would give the City two lanes.  A left turn lane and right straight and turn lane.  The accidents KDOT identified were from the left turn movement, westbound to southbound.

            Kennedy asked if KDOT would require the City to build the islands or the medians.

            Gorman said “no.” 

            Hack asked Gorman if she could explain the current situation with respect to access to Commerce Plaza and what it would include now and in the future.

            Gorman said Commerce Plaza’s existing access point was near their east property line.   She said with the widening of the road and the elevation difference it made too steep of a grade and the gas tanks prevented grade adjustments.  She said the only cut that could be left open for Commerce Plaza was the frontage road cut, as it existed right now.  A compromise solution could be to have an access cut further to the east and would be on the Home Depot property to allow gas trucks to enter to service the holding tanks, but it would only be temporary.

            Commissioner Hack asked if Gorman could discuss the traffic movement in regard to the medians on 31^st Street and why the medians were necessary.

            Gorman said this was a function of the left turn lane stacking which was a function of the traffic study and traffic volumes that were anticipated.  The anticipated traffic volume would determine the length of left turn lanes which in turn would drive the length of the median.  She said the east side was longer than on the west side.  

            Commissioner Kennedy asked about the east truck entrance into the Malan Realty property at K-mart which was close to the traffic light and asked if this entrance could remain open.

            Gorman said that entrance could remain open although it was close to the traffic light.

            Mayor Rundle asked if there would be a median all the way if there was no light in the middle of the site.

            Gorman said it was entirely possible in order to control the access points, unless the City controlled them by the platting process.  She said a median would be appropriate and if and when you go to double left turn lanes at any intersection, you have to have that median to keep those double left turn lanes separate to guide them.  She said it was critical that everyone stay in their lane when they were making a left turn.

            Rundle asked if that would continue all the way back to Ousdahl.

            Gorman said she thought it was possible without projections of any development.  She said the K-mart cut was close to the intersection of 31^st and Iowa.

            Commissioner Hack said with or without that mid block intersection, medians would more than likely need to be extended toward Ousdahl.

            Gorman said “in the long run.”

            Commissioner Henry asked about the west side of Iowa and the concern about left turn traffic into the Bank’s entrance and traffic conceivably backing up onto Iowa.  He also asked Gorman if staff had looked at the number of cars that could be stacked before entering the intersection.

            Gorman said “no.”  She said staff had not done that calculation.  She said she agreed with Landplan’s original proposal which did not block the Douglas County Bank’s cut.  She said KDOT commented to the City to extend that median and block that cut.  Gorman said she questioned KDOT’s comment and why did they care about that cut versus the K-mart cut.  She said KDOT comment was if the left turns into K-mart start backing up on 31^st Street, it would be a City problem, but if vehicles start stacking at the Douglas County Bank cut, the vehicles would back up on Iowa Street and that was KDOT’s problem and they would not allow that.  She said she hoped the City could come to some kind of temporary compromise with KDOT.

            Commissioner Kennedy asked if this would be a temporary compromise until the traffic developed enough to where it became the City’s traffic problem.

            Gorman said “yes,” or it could be until Nieder Road was signalized. 

            Commissioner Hack asked Linda Finger, Planning Director, to clarify Planning staff’s position with respect to the mid-block intersection.

            Finger said staff’s comment was that the mid-block intersection was in direct conflict with the 31^st Street access policy and was not recommended by staff.  What staff recommended was Ousdahl.

            Commissioner Kennedy said in regards to the Planning Commission, the preliminary development plan was approved by the Planning Commission by a five-four-one vote.  He asked when the final development plan would go to the Planning Commission.

            Finger said the final development plan had been approved by the Planning Commission also by a five-four-one vote.

            Watkins said one issue that was brought up was the extended right turn which would be constructed when the gas station was moved or when the lease ran out. 

                Tom Thorson, Home Depot Real Estate Manager, said this project has been on a long difficult road with a fair amount of controversy.  He said through this journey Home Depot had come forward with something that was good for everyone.  He said it was Home Depot’s understanding through market research that this location was the premier location in town.  He said not only would this location suit the demands of their business and operations, it would be the best place to serve the entire community.  He said there had been a lot of conversation in regard to technical aspects of the agreement.  He said Home Depot tried to hire the best people they could to represent them regarding traffic studies.  This particular project has been studied three different times for a number of different scenarios.  He said he was not a traffic expert and could only rely on the information that was provided and that information said that the developer had traffic improvements that would work now and in the future. 

            Thorson said he wanted to address the remarks made about suitable allocation of taxpayer money.  He said it was estimated the amount of tax revenue in year one would be $1.2 million.  In twenty years it was estimated to be $2.8 million and in the total twenty-year period it was estimated to be $43.2 million.  The improvements that were proposed were there as a result of this development, but were upgrades suggested by KDOT or the Public Works Department that they believed helped create a better intersection for today and the future.

                Todd Thompson responded to some of Thorson’s comments.  The traffic studies were done with a mid traffic light.  He said the City Commission did not have a traffic study that did not have a mid block traffic light, so you don’t really know what improvements were needed with that scenario.  He also agreed with Thorson’s statement that a majority of the improvements were being proposed as a result of this project. 

            Suderman commented on Thorson’s tax generation statement.  Suderman said whether it was located in one location or another, assuming they do their typical thirty five to forty million dollars a year in sales, that same amount of property tax would be generated and that same amount of sales tax would be generated and he did not see how this would be a different element. 

Mayor Rundle said any change to the original agreement would need to be initiated by a Commissioner voting in the majority during the last Home Depot vote.

Commissioner Dunfield started the Commission discussion by saying he was trying to change one majority vote.  He said the project passed the Planning Commission on 5-4 votes.  It passed the City Commission by 3-2 votes, and to revisit any of the decisions made it required a change by one of the three majority voters on this Commission.  In spite of the fact that his project had been in the public eye for some time, there was new information that had been collected as a result of the efforts of the Indian Hill residents primarily over the last couple weeks, as well as new information that the Commission did not know about until today.  He said this information was significant.  The first piece of this information was the developer was purchasing the Commerce Plaza properties.  He said it seemed pretty clear that they had been intending to do that from the start.  It also seemed clear from Watkins’ presentation that part of Dellaportas’ strategy was to work for the best possible deal that they could get on that property.  However, the City Commission’s job was to look out for the Lawrence taxpayers not for a particular developer or property.  He said it was clear from previous discussions at the Planning Commission and the City Commission that Dellaportas also wanted to maximize access to 31^st street, and part of that strategy was to not guarantee access to Iowa because they did not control that property and this statement had been made to the Planning Commission and the City Commission. 

Dunfield said the second piece of information was the impact these changes were going to have on the intersection and the development of the traffic situation along 31^st Street.  It seemed the more detail the City Commissioners see about the road construction, the more KDOT would get involved and talked about what they saw happening in the future. 

Dunfield said it was clear that there would be several issues needing to be addressed. One was the possibility of damaging existing businesses along that street and another was creating a situation where the City was likely to end up with gridlock at the intersection in a relatively short period of time.  For both of those reasons, he said there were two options.  One of them was to reconsider the Preliminary Development Plan.  The reason for doing this would be to require that the development be oriented toward Iowa Street.  The City needed to solve the right turn lane issue and eliminate the access road condition.  He said if the City was going to spend a lot of money on this intersection then let’s take care of those things.

The second issue that needed to be addressed in terms of oriented towards Iowa street was eliminating the mid-block access and the traffic signal, which was not a good thing for the City to be doing to 31^st street, not to mention the fact that Planning staff had opposed this issue all along.  He suggested capping the City’s portion of those costs at a considerably lower number if the City wanted to reconsider the Preliminary Development Plan. 

Dunfield said his second option was to reinitiate a rezoning of this property.  The rezoning had already gone through, but because no building permits had been granted and no construction had started on the site, it was within the Commission’s authority to initiate a rezoning recognizing that the decision made before was in error.  Horizon 2020 limited the size of regional developments and proposed guidelines that limit the size of regional commercial centers.  The City was seeing why Horizon 2020 had that guideline in place with the projected traffic problems that were already created, to a large extent, by making exceptions to Horizon 2020 and by continuing to make exceptions.  What the City was seeing as a result of this development was a clear demonstration as to why those limits on regional commercial centers that were in our comprehensive plan needed to be followed.  For all of the existing business, which the City had already put in place along south Iowa, the worst possible outcome was gridlock.  These were all automobile dependent businesses, and he understood the attraction of being next to other businesses that were generating similar kinds of traffic.  On the other hand, if the area reaches a point where it cannot accommodate the traffic and gridlock results, then all of the businesses would be hurt and so would the regional center.  Dunfield said those were possibilities he would like to see the City Commission consider but he was one of the minority voters on this issue.

Mayor Rundle said he concurred with Commissioner Dunfield.  He said the argument that people made was that the City was going to need to improve this intersection anyway.  It was in the City’s CIP Plan, but this was not our schedule.  He said our schedule was to look at this in a more careful way. 

Commissioner Kennedy commented on the $300,000 from KDOT.  He said the $300,000 was to repair a small portion of the intersection, but the City would need to repair a bigger share of this intersection in the future.  This intersection had been approved by the Planning Commission on 5-4 votes for both the Preliminary Plan and the Final Development Plan.  The City Commission approved the intersection by a 3-2 vote.   He said what the Commissioners were here to approve or disapprove was the proposed agreement because the intersection was already approved by those boards and commissions. 

Kennedy said the Commission needed to talk about how much money the City was going to contribute, versus the developer, and what the City would be acquiring.  The City would acquire an intersection that would be extensively repaired.  He said the City needed 31^st Street repaired.  He said the City tried to eliminate as many hazardous left turns as possible.  The medians were a necessity and he thought the City could work with KDOT on the western leg of this intersection and reach a compromise on the Bank’s entrance.  He said a left turn into the K-Mart property would work.  He said the prices had come down.  At one time the City cost was 1.6 million dollars and now the cost was down to $1.3 million.  He said the $1.3 million was going directly to the intersection and fixing one of the most hazardous intersections in town and the developer was paying for the rest.  He said he was comfortable with the fact that Home Depot would work with Commerce Plaza Development to make the cross access work and to also make the temporary access work for the business that was going to be impacted by this development.  It was their responsibility to make sure that this did happen until the lease ran out and the turn lane could be finished for a safe intersection and safe right turn.  He said as you get into additional development the main issue was safety.   Kennedy said he wanted to proceed on with the agreement and did not see any major problems as long as they had some assurances from Home Depot that they would work with Commerce Plaza in assuring that these access points and temporary roads were taken care of properly.

Commissioner Hack said it was interesting that Thorson would use the word “journey” which was what she had written down when she thought about this situation.  She mentioned that she appreciated the work of the staff, the developer, and residents with providing so much information.  She said she had concerns about the project regarding cost, existing businesses, fairness to the community, commercial interest, and safety.

In terms of costs, Hack said she believed that Home Depot was not driving the need for the improvements of 31^st and Iowa.  It has been a major concern for this community since 1996.  She said it was easy to take comments out of context, but when you look at a comment made by Huffman at a previous meeting, he said he thought improvements on 31^st Street were going to be required of the City regardless of whether or not Home Depot was at that location.  She said one way to view this opportunity would be as a public/private partnership to make some much needed improvements and get some three way partnering going between the private developer, the City and KDOT.  Hack said the City Commission’s direction and staff’s work solution to the access to the Malan property had been addressed, but she wanted to make sure that an access point continued to be open and it looked like there could be a compromise made with Douglas County Bank.  Hack agreed with Commissioner Kennedy’s median comments in that they might not be the preferred method of traffic control, but the overall picture of safety had to be taken into account and they become necessary.  The improvements of 31^st and Iowa would make it a safer intersection. 

Hack said this was not a decision that had been made without listening to a lot of people and asking a lot of questions. Based on the information and her own personal feelings about this project, she supported the agreement the way it had been proposed to the City Commission.

Commissioner Henry said he voted for the project last October because he believed then, and still did, that the intersection improvements were needed.  The money that was being directed this way would go toward vastly improving a bad situation.  At that time, the cost of the project was $2.1 million then the cost jumped to $3.2 million and would be shared by the City and the developer and KDOT would not be contributing. 

Henry said he thought there were a couple of principles needing to be considered.  One was that no two developments were exactly alike, but the City was facing a tough financial situation and it was only going to get tougher when there was less and less money coming from the state as well as other issues that would affect Lawrence.  He said we would need to makeup that revenue somehow such as through sales and property taxes and if the City did not do this, the revenue would come from the mill levy which would affect everyone.  The City had an opportunity for a developer to provide a significant amount of money to help alleviate a bad traffic and safety situation.   

Mayor Rundle said to comment on this as being a bad intersection and the City would be putting money and effort into this intersection begs the question that this project was making the intersection worse.  He said the City had no idea of the future impacts from extending 31^st Street from Haskell east.  The money the City was contributing, given that times were hard, one needed to look at what the City could do elsewhere with that $1.6 million.  He said he thought it was false to look with a great deal of optimism on the Douglas County Bank compromise.  That was not a given, KDOT had simply said that they would always listen to an appeal.  He said he thought it was meaningless that the City had to get assurances from Home Depot regarding redevelopment of Commerce Plaza.  The City can’t enforce those assurances.  These were the mechanisms by which we guarantee things would turn out the way we want them to or the way we plan.  He said obviously it was redundant to the City’s comprehensive plan and did not think this was doing this on their schedule was the pressure we should be listening to.  He said he did think that basically this was a new project with all the new information that was presented or withheld, which ever the case might be.  He said the City haggled earlier in the evening over setting a precedent by giving up property taxes on a City building in the amount of $4,000 to $5,000 a year.  If you multiply that times twenty years, it would be $100,000.  He said nobody was comfortable in doing this, yet the City was setting a precedent here in contributing to a retail project which was not the City’s policy.  He said he did not know why precedent was not of equal concern when were talking about over a $1,000,000 as it was when your talking about $100,000.  He asked the Commission to consider the options that Commissioner Dunfield suggested.  He said this would truly be looking out for the public. 

Commissioner Kennedy asked Mayor Rundle, whether the Commission should draft a memorandum to ensure the redevelopment of Commerce Plaza be addressed.

Mayor Rundle asked Commissioner Kennedy to remind him of what the City was going to gain.

Kennedy said the gas station has a lease for eighteen months.  He said this project was going to take approximately one year and the lessee would be doing business during this time.   He said the gas station’s access would be depleted and would only be able to enter off the access road.  The developer could build a temporary road at the southwest corner which would enable him to get his gasoline trucks in to refuel.   

Mayor Rundle asked Kennedy was he taking this to the next level to moving the gas station north.  He said it seemed that the Commission was backing into this issue instead of what Commissioner Dunfield proposed which was getting the intersection properly planned according to the Comprehensive Plan and good taxpayer sense.

Moved by Dunfield, seconded by Kennedy, to extend the meeting until 10:30 p.m.  Motion carried unanimously.     

            Moved by Hack, seconded by Kennedy, to direct staff to proceed with the March 4, 2002 agreement with Home Depot for the construction of the public improvements at Iowa Street, 31st Street, and Ousdahl Road.  Aye:  Hack, Henry and Kennedy.  Nay:  Dunfield and Rundle.  Motion carried.                                                                                                          (13)

            Moved by Kennedy, seconded by Hack, to waive the bidding requirements for the public improvements at Iowa Street, 31st Street, and Ousdahl Road.  Aye:  Hack, Henry and Kennedy.  Nay:  Dunfield and Rundle.  Motion carried.                                                               (14)

            The City Commission deferred the spring goal setting session discussion until the March 6^th study session.                                                                                                                        (15)

            Moved by Kennedy, seconded by Henry, to adjourn at 10:05 p.m.   Motion carried unanimously.     

                                                                       

                                                                                                                                                                                                                                                            APPROVED:

                                                                                    _____________________________

ATTEST:                                                                                Mike Rundle, Mayor

___________________________________                                                                       

Frank S. Reeb, City Clerk

 

COMMISSION MEETING MARCH 5, 2002

1.                  Purchase Software – Utility Billing Dept., (Finance) from Creditron for $51,523.

2.                  Bid – Westwood Hills-Baldwin Creek No. 2, to McLouth Excavating for $1,196,437.80.

3.                  Ordinance No. 7506 – 1^st Reading, establish City Commission quorum at 4.

4.                  Ordinance No. 7507 – 1^st Reading,  “stop sign” Westbrooke Cir at Westbrooke St & Petefish Dr. at  Westbrooke St.

5.                  Ordinance No. 7503  – 2^nd Reading, amend Chapter 5, Article 801-805, swimming pool regulations.

6.                  Ordinance No. 7474 – 2^nd Reading, annex 13 acres, N 1400 Rd, E of Noria Rd.

7.                  Ordinance No. 7504 – 2^nd Reading, special assessments, Kasold S of Clinton Pkwy & Clinton Pl.

8.                  Annexation Request – for property City is seeking to purchase from Francis Kelly.

9.                  Brook Creek Neighborhood – renaming streams & watersheds.

10.              Site Plan – (SP-06-39-01) Dillon’s Fuel Facility No. 68, 3000 W 6^th.

11.