Memorandum

City of Lawrence

City Manager’s Office

 

TO:

David L. Corliss, City Manager

FROM:

Diane Stoddard, Assistant City Manager

DATE:

February 25, 2014

CC:

 

Cynthia Wagner, Assistant City Manager

Britt Crum-Cano, Economic Development Coordinator

RE:

9th and New Hampshire Redevelopment District items

 

Please place the following item on the March 4, 2014 City Commission agenda: 

 

Consider the following items related to the 9th and New Hampshire Redevelopment District:

·         Consider adopting Resolution No. 7056, establishing April 8, 2014 as the public hearing date on the proposed Redevelopment Plan for the North Project Area for the 9th and New Hampshire TIF project;

·         Consider adopting Resolution No. 7061, establishing April 8, 2014 as the public hearing date on the proposed Transportation Development District for the 9th and New Hampshire Redevelopment area; and

·         Consider adopting on first reading, Ordinance No. 8963, repealing the existing Transportation Development District for the 9th and New Hampshire Redevelopment Project. 

 

Background:

In 2012, the City Commission established a Tax Increment Finance District (TIF/Redevelopment Area) for the 9th and New Hampshire Redevelopment project.  The TIF area includes two project areas, a South Project area and a North Project area.  The redevelopment plan for the South Project area was approved in 2013.  The new hotel on the southeast corner of 9th and New Hampshire, which is the cornerstone of the South Project area, is currently under construction. 

 

The developers have submitted a proposed redevelopment plan for the North Project area.  The redevelopment plan calls for a new $24.5 million mixed-use apartment building with underground parking on the northeast corner of 9th & New Hampshire, which would replace the existing structure.  The Planning Commission considered this redevelopment plan at its February 24 meeting and unanimously made a finding that it is consistent with the City’s comprehensive plan.  The next step in consideration of the plan is a resolution setting the date for a public hearing on the proposed plan for April 8, 2014. 

 

Transportation Development District:

In 2012, the City Commission approved a Transportation Development District (TDD) for the 9th and New Hampshire redevelopment area.  This TDD will add an additional sales tax of one percent (1%) on purchases made within the district.  According to the development agreement for the project, the first $850,000 of the TDD revenue will be dedicated to the City as a contribution to the existing 9th and New Hampshire area parking garage.  The remainder of any projected revenue would be used to reimburse the developer for parking garage costs not otherwise reimbursed through TIF revenue. 

 

In early 2013, the City became aware that there was a problem with the TDD petition that was used to establish the 2012 TDD.  The problem came to light when the documents were being filed with the Register of Deeds.  The owner of the northeast corner property was listed as a different Compton entity than the actual owner, Compton Rentals, LLC.  This creates a problem with the legitimacy of that 2012 TDD.  Because the City of Lawrence is the primary beneficiary of the majority of the TDD revenue, it is in the City’s interest to fix the TDD so that there is no question about its legality in the future. 

 

The developers submitted a new petition with the proper ownership in the fall of 2013.  Everything is the same about the new petition as the TDD approved in 2012, except that the current TDD is set to start collection on July 1, 2014 and the new petition calls for the collection to begin January 1, 2015.  The reason for the date change is that January 1, 2015 will be closer to the opening of the hotel than the July 1, 2014 date.  Staff recommends that the City Commission repeal the current TDD and begin the process of approving the new TDD.  The next steps for this is to set a public hearing date for the new TDD on April 8, in conjunction with the public hearing on the north project plan.  Also, the City Commission should consider first reading of an ordinance repealing the 2012 TDD.

 

Staff recommendation:

Staff recommends that all of these items be approved by the City Commission. 

 

Action: 

Consider the following items related to the 9th and New Hampshire Redevelopment District:

·         Consider adopting Resolution No. 7056, establishing April 8, 2014 as the public hearing date on the proposed Redevelopment Plan for the North Project Area for the 9th and New Hampshire TIF project;

·         Consider adopting Resolution No. 7061, establishing April 8, 2014 as the public hearing date on the proposed Transportation Development District for the 9th and New Hampshire Redevelopment area; and

·         Consider adopting on first reading, Ordinance No. 8963, repealing the existing Transportation Development District for the 9th and New Hampshire Redevelopment Project, if appropriate.