Archive for Friday, October 7, 2011

Redevelopment of Poehler building in east Lawrence could cost city $1.3 million

October 7, 2011


Saving a piece of the past will take more than a little bit of public money in the here and now.

City commissioners at their meeting Tuesday will consider authorizing more than $1.3 million worth of incentives and public improvements to help a Kansas City developer rehabilitate the former Poehler Mercantile Co. building and an adjacent 1880s structure near Eighth and Delaware streets.

City officials are touting the proposed development — which will add affordable apartments and artists studios — as a way to spark a revitalization of a significant portion of east Lawrence.

“We feel like this really is a reinvestment in our infrastructure in an important part of our community,” said Diane Stoddard, an assistant city manager who has been working on the project. “The benefits for our community will be to save a really important district in our city’s history, and to save an important structure that is in some real jeopardy.”

Redevelopment plan

The Poehler Mercantile building is a 1904, four-story brick building that once was the centerpiece of the east Lawrence industrial district that runs along the railroad tracks and parts of Delaware and Pennsylvania streets. But the grocery warehouse company vacated the building in 1957, and the building has had a large amount of vacancy ever since. Currently, the building is boarded up and its roof is failing.

Kansas City-area developer Tony Krsnich has the property under contract. He plans to convert it into nearly 49 apartment units, with all but three of the apartments being entered into a rent-controlled affordable housing program. His group also has purchased the adjacent Kansas Fruit Vinegar Co. building, 810 Pa., to convert into about 40 artist studios, a gallery space and an outdoor exhibition and reception area.

Krsnich — who currently is finishing a similar apartment conversion of the old Chatham Hotel in Kansas City — said early on that he expected the $9 million project would need some financial assistance from the city. Now, city commissioners are putting forward their most detailed plan yet of how much that help may total.

Proposed funding

Among the proposed improvements and incentives being recommending by city staff are:

• $800,000 to improve Delaware Street from Eighth to Ninth streets. Much of the street has deteriorated to the point that it is largely a gravel path. Plans call for all new pavement and stormwater collection systems.

• $300,000 to construct a new public parking lot along the new portion of Delaware Street and to improve the alley that runs adjacent to the property. The parking lot would be maintained by Krsnich’s group, and after 15 years his group would take over ownership of the parking lot for $1.

• $100,000 to install a new water line along Delaware Street between Eighth and Ninth streets.

• $85,000 to pay for up to 75 percent of the costs to install a fire sprinkler in the Poehler building.

• $73,538 to improve Eighth Street from Delaware to Pennsylvania streets.

• $36,980 to make sewer, water and fire line utility connections to the Poehler building.

No tax increase planned

City administrators have put forward a plan that would allow the project to be funded through new debt, water, sewer and stormwater funds. A tax increase isn’t called for to fund the project.

The project has not been run through the city’s traditional cost benefit model, which attempts to quantify how much in new tax dollars and other benefits the city will receive for every $1 it gives in incentives.

Stoddard said such an analysis likely would not produce a favorable result because the project is not the type that produces a large number of permanent jobs, and because most of the housing units will be rent-controlled it is not expected to generate a large increase in property tax revenue either.

But the project already has won some support on the City Commission. City Commissioner Hugh Carter said he thought the project had great potential to be a force for revitalization of the surrounding properties, and he’s particularly excited about the arts element of the development.

“There’s the historic preservation element and there is the affordable housing element, which we do have a need for, but the idea of furthering the cultural district sounds very appealing to me,” Carter said. “There are some elements in there that are hard to quantify.”

Krsnich said the investment from the city is critical to the success of the project.

“The majority of what we’re asking for is help with improving the existing public infrastructure,” Krsnich said. “We’re going to create an amazing space down there, but we just need people to feel comfortable coming to the area.”

Originally, the project had planned to ask for property tax rebates as part of the Neighborhood Revitalization Act. But Krsnich said that incentive no longer is being considered.

Commissioners will consider the request at their meeting at 6:35 p.m. Tuesday at City Hall, Sixth and Massachusetts streets.

There may be just four commissioners who vote on the project. Previously, Mayor Aron Cromwell recused himself from discussions on the project. The project is expected to include work to install a large number of solar panels on the roof of the Poehler building. Cromwell’s environmental engineering firm is expected to bid on that work.


John Hamm 6 years, 7 months ago

Once again, and I'm really getting disappointed at having to say this, You've got to be kidding me!

pizzapete 6 years, 7 months ago

OonlyBonly, this is awesome, think of the possibilities. I'm thinking I can put an artist/living space in my garage if the city will give me $100,000 in incentives. And when I hire the tenents to paint my house I can ask the city for a $25,000 forgiveable loan to pay for it. Every homeowner in Lawrence should be able to have a swimming pool or hot tub paid for by the city by next Summer. That would be totally awesome, thanks guys!

cummingshawk 6 years, 7 months ago

I sure could use a new driveway. With the city financing suddenly available for almost anyone saying give me, and they can skip the cost-benefit study, that should save a couple of bucks, I'll glady pay the city a dollar in 15 years for a safe place to park my vehicle. You know, my garage is starting to show its age, well better not get greedy, there are others waiting to get to the city cash spigot!!!

Jonathan Fox 6 years, 7 months ago

You'd think that a place worth this much investment could afford to pay more than $1 for a parking lot after 15 years of business, assuming it's even still in business...

jafs 6 years, 7 months ago

I think the idea is that they get it in exchange for "maintaining" the lot over the next 15 years.

John Hamm 6 years, 7 months ago

Gosh, I have to apologize to PIZZAPETE and CUMMINGSHAWK. I just didn't think this through to a logical, reasonable conclusion. I'm gonna start making MY list right now.

down_the_river 6 years, 7 months ago

The artist studio angle is the cute kitty appeal in this set up. It's the exact same approach that was used to get the city to give away property and funds for what turned in to Abe and Jakes night club. How well did that art scene play out? You don't remember all those artist studios and the revitalization and economic development that grew from that public contribution? Simply didn't happen. Keep the arts discussion out of this development. If we need to subsidize some more housing, that should be the totality of the question for this location. I imagine some apartment owners may not be too pleased to think their property taxes are being handed to another apartment owner to build more units while the city's vacancy rate rises. I realize we're hoping Lawrence will become a magnet for retired people as the KU student population shrinks, but I'm not convinced this will be a retirees dream locale.

Cant_have_it_both_ways 6 years, 7 months ago

Krsnich said the investment from the city is critical to the success of the project. ++++++++++++++++++++++++++++++++++++ Imagine that.

akuna 6 years, 7 months ago

Come on people. Almost every single house in Lawrence has benefited from the city contributing to the development of a new subdivision. Why is this any different? I guarantee you that the roads sidewalks, the sewer and water lines, and the the electric lines that your houses use were paid for by the city, at least in part. Just because this is an old building that is being renovated doesn't mean that it doesn't deserve the same benefits that the developers of your houses got.

down_the_river 6 years, 7 months ago

This is different, that's why it's needing a vote by the commission to agree to it. Most new water and sewer service requires a meter fee (that can be rather expensive) paid for by the property owner. Sidewalks and roads will use a benefit district basis to assess the costs of the new concrete work to the properties served. If there is a need to extend electric service, the cost of running new lines is the burden of the owner.

While there are examples where, as you suggest, the city pays at least in part, this is different. These costs, typically the owner's responsibility, are being asked to be paid by Lawrence residents entirely. That's why this exceptional request requires a vote.

bearded_gnome 6 years, 7 months ago

OB: remember to add to that list sprinklers!

Down-the-river, I agree. I cannot imagine that address being attractive to the new influx of retirees, not without a lot of other changes in the area.

Enlightenment 6 years, 7 months ago

at least it is a starting point for revitalization as opposed to developers creating more sprawl.

Kate Rogge 6 years, 7 months ago

It's probably help to be a bit hard of hearing that close to the tracks. Jeeze, Louise. Is there a developer on the face of the Earth that can't get $$$$ public money from the Lawrence city commissioners?

Enlightenment 6 years, 7 months ago

akuna.........couldn't agree more with your comment. I know that the city leaders often do favor a few select developers and give them special treatment without these developers providing any real benefit to the city. However, this developer is asking that the EXISTING streets be repaired. The bulk of the expenditure is for these repairs and in return, the city will be getting a completely renovated building that will provide rent controlled apts in an area with high housing cost. It is great to see existing structures be revitalized as opposed to approving more urban sprawl.

Lee Eldridge 6 years, 7 months ago

These types of projects do not get accomplished without local government assistance. The choice becomes this: do you want the building to be preserved or not? Do you want that section of town to be improved or not? Nobody will takeover that property without significant assistance from the community. That's why it's been mostly vacant for 50+ years.

I'm all about responsible government spending. I was against the T from the start because I knew it would never pay for itself. I think we're spending too much on the library. But these types of projects (the Poehler bldg) make sense to me. Keeping our history is important when we're able to do it. Revitalizing a portion of our community near downtown is important. And providing some rent control living space is needed in Lawrence.

Richard Heckler 6 years, 7 months ago

Explain how this project will ever pay back the taxpayers.

Taxpayers approved money for the T and the library.

Let the taxpayers approve all forms of local corporate tax dollar welfare aka pork barrel please. I'm all for this.

YES let the voters decide!!!

flyin_squirrel 6 years, 7 months ago

Merrill (Kirk McClure), you don't want sprawl because it increases the roads and services. Now you don't want infill because the roads and services need to be updated. Either speak your real agenda (no growth at any cost and let Lawrence die), or don't talk at all.

jafs 6 years, 7 months ago

Actually, he's advocating that we get to vote on all such expenditures, and let the voting residents of the town decide them.

And, why on earth you think you have any sort of right to tell him how he should speak, or that he should stop, is beyond me.

irvan moore 6 years, 7 months ago

wouldn't that have made a great building for city services/offices?

rtwngr 6 years, 7 months ago

Every old building in town doesn't need to be saved.

Cindy Wallace 6 years, 7 months ago

I just HAVE to comment....I am so tired of the City paying for every type of improvement a developer proposes. While I think the renovations for the Poehler building is a great idea, I also think the developer should pay for his improvements to the building to bring his plan to fruition. I can bring myself to agree that the city should pay for street and water line improvements, however, even just the SUGGESTION that WE, the City, should be responsible to pay for a parking lot, that WHO will be using, other than the tenants of this building?, a fire sprinkler system AND sewer, water and fire utility connection is absolutely ludicrous! Is the City advising me, by their actions, that I am now able to go out and buy a run down home, built in the late 1800's and they will pay for all of the renovations and improvements to bring my home up to code? and then give me a new driveway? There is no mention in this article of the developer paying any amount of this money back.....I am trusting that the developer knew all of the improvements needed to bring this building up to code BEFORE it was presented??

Cant_have_it_both_ways 6 years, 7 months ago

Investment from the city is critical to the success of the project, but is the success of the project critical to the city. The answer is a resounding NO.

down_the_river 6 years, 7 months ago

Chad, if you have a follow up article, could you explain a comment from the city? In this article it's noted "it is not expected to generate a large increase in property tax revenue". This is a property that seems to be valued at $900,000, projected to receive a $10,000,000 upgrade. How does that not result in a significant increase in property tax revenue? What's buried in these calculations? Much (but not all) of what's described as the taxpayers' contribution to this development would seem perfect for the existing Tax Increment Finance tool, but with the suggestion that there wouldn't be an increase in property tax revenue this seems moot? Why no increase?

leftylucky 6 years, 7 months ago

what happened to the deal the city had with the developer ( Harris ) to rebuild Delaware street. With the sewage treatment plant so close by and the stench that radiates from the plant drifting into east Lawrence this development is doomed to fail. Let the developer pay for the improvements. How much are the rents for affordable housing? Will section 8 help subsidize this affordable housing? Bad idea.

Richard Heckler 6 years, 7 months ago

Why do city governments take such a blatantly bad deal? It is time for City Hall to demand 5% interest on OUR tax dollars borrowed by developers....please!

Hey Mr. developer find out how the project will cost and go to the bank! We do not want city hall to be a no interest lending institution.

None of these new apartments or new housing projects will ever pay back because Lawrence,Kansas does not have thousands upon thousands of jobs for Lawrence residents. Keeping locals employed locally is the only way new residential pays for itself which has been part of the equation forever however has not existed in Lawrence for at least 25 years.

Again find out how the project will cost and go to the bank!

If the city has tax dollars to blow why is the city increasing our cost of living: by increasing user fees by increasing property taxes

Residential growth does not pay for itself because the funding of revenues generated by residential does not pay for the services they require from a municipality. In essence new residential growth = a tax increase.

In order for the city to have orderly fiscal growth developers need to be responsible for all new infrastructure if Lawrence taxpayers are to expect new economic growth instead of increased user fees and taxes to support more new bedrooms. In essence new residential growth = a tax increase.

None of these new apartments or new housing projects will ever pay back because Lawrence,Kansas does not have thousands upon thousands of jobs for Lawrence residents. Keeping locals employed locally is the only way new residential pays for itself which has been part of the equation forever. Otherwise new residential growth is a tax increase.

Richard Heckler 6 years, 7 months ago

Want new economic growth?

*Clean up downtown and add more landscaping

*Put Lawrence among the bicycle capitols of the world

*Invest big time in making Lawrence the walkable community we claim

*Bring new conventional retail to downtown to help support existing retail

*Stop killing downtown = no more bars and cafe's = It's draining our pocketbooks and increasing taxes( it is also making it damn difficult for existing eating establishments)

*Cut pork barrel spending on new residential = It's draining our pocketbooks and increasing taxes

  • Stop annexing = It's draining our pocketbooks and increasing taxes

evilpenguin 6 years, 7 months ago

Indeed, a walkable community would be nice. I tried walking to downtown from out Wedgewood way once and I've never done it again. The sidewalks close to downtown are a joke!

Mayyhaps they could also use the cash to flatten out 10th street just east of Sunfire Ceramics. I can't drive down that street as, no matter what vehicle I use, I can't make it over the hump without scraping.

esteshawk 6 years, 7 months ago

Want economic growth? Move Lawrence out of Kansas. On a serious note though, Kansas as a state is dying. If the city wants to keep expanding, officials have to offer incentives to counter what other places offer. You might not like the medicine, but if you are not expanding, then you are dying as a city.

jafs 6 years, 7 months ago

Why are those the only two options - expand or die?

It seems to leave out the real, and reasonable possibility of sustainability without continued growth.

Lawrence_Pilot 6 years, 7 months ago

You name it and the posters here will hate it for you. Doesn't matter how good the idea.

Fortunately, most of you don't live in the city and do very little except complain.

lunacydetector 6 years, 7 months ago

but this idea sucks. more money stolen from the taxpayers by our 'honest and reputable' (progressive sustainable smart growth) city hall.....all in the name of starving artists.

Tyson Travis 6 years, 7 months ago

As a former Lawrence resident whose father worked for Poehler in the 1940s and early 50s, and who used to buy antiques in the Salvation Army thrift shop downstairs in the 1960s, I'd certainly like to see this building get saved, but I have concerns about fire safety in such an old building, especially if it doesn't have a reinforced concrete or steel frame. All I've heard about is the massive wood beams, which are pretty well dried out after 107 years. I'd suggest doing a fire safety evaluation, fix the roof to conserve the structure, then develop living units from the bottom one floor at a time as rental occupancy rates warrant. Build in a good sprinkler system first. Look at the massive fires in the old Lawrence House Hotel and at 8th and Mass in around 1979, and you'll see these old buildings have to be used with caution. Good luck, hope you can pull it off, but I'd proceed conservatively as it gets rented out and the street improvements justify.

just_another_bozo_on_this_bus 6 years, 7 months ago

Actually, wood beams are in some ways safer than steel ones, especially during a fire. Wood beams have to significantly burn through before they fail, whereas steel beams can lose their strength rather quickly in a hot fire (which is why they are usually sprayed with a protective coating.)

Getaroom 6 years, 7 months ago

First, get the roof fixed so no more deterioration occurs inside the building and that much the developer needs to do anyway as an owner and to prevent a demolition notice coming up. Sit on it until better times roll in. It is actually a good idea to create more living space in the downtown area and especially if that space is more affordable than Hobbs Lofts. As far as artist studios are concerned, sure why not, if they can pay for them when made available. Around here so little local fine art is sold I think it is still a better idea for home based studios or an artist collective that is created by, designed by, built buy local artists who chose to participate in such an enterprise as a functional business. Otherwise, I think it is up to the developer as to how building use is laid out and paid for - not the cities burden in this case. Infrastructure upgrades and maintenance are critical and no doubt will eventually need to be done anyway along that corridor. It is true we can't have everything we may think we want and needs must be met before wants and especially during these difficult financial times.

This proposed renewal project is not about "the arts" anyway, even if it is a passionate component of the developers concept. Not all aspects of a renewal project necessarily come to fruition, but we can't stop the dreaming and creativity. It seems like most of the naysayers comments here offer only knee jerk reactions. Perhaps we need to come up with an antidote vaccine to counter the Brownbackward Disease that has infected this state.

lunacydetector 6 years, 7 months ago

Caprini-Green on the kaw..... the "urban renewal" is already in the bag and the money has already been put into the city's budget .....quite progressive....obama would be proud if he knew....i wonder if cromwell will be dressed up like bonnie from bonnie and clyde, as the city commissioners steal even more of OUR money?

esteshawk 6 years, 7 months ago

Cabrini Green? Good grief what an absurd (and possibly racist) comparision.

ljwhirled 6 years, 7 months ago

Some of this is smart and some of it stupid:

Smart: $800K to improve the street? City street, sounds good. $173K for water line and street improvements? City infrastructure, sounds good.

Stupid: $300K to build a private parking lot and pave the alley. $36K for private water service. $85K for private sprinklers.

Keep the private private, and keep the public public.

At least the developer is being honest about it and asking for expenditures. There is nothing that is more shady than doing this same type of project and paying for it through the tax incentives.

lunacydetector 6 years, 7 months ago

city hall already budgeted for this specific project, so we don't have a say......i say, let's kick these bums out then get a new city manager.

jafs 6 years, 7 months ago

I agree - the public/private stuff bothers me too.

George_Braziller 6 years, 7 months ago

I agree. Even if the project falls through the city is still going to eventually have to make the street improvements. That section of street is in worse condition than the alley behind my house.

just_another_bozo_on_this_bus 6 years, 7 months ago

Few (none?) of the apartments that have been built recently or are being built are rent-controlled, low-income housing.

bearded_gnome 6 years, 7 months ago

Merrill spammed: Let the taxpayers approve all forms of local corporate tax dollar welfare aka pork barrel please. I'm all for this.

YES let the voters decide!!!

---LOL!!! so hypocritical. Merrill wants a vote, but was all for forcig healthcare fascism down our throats without our having a say.
he also believes: *broken streets are useful as passive traffic calming devices;

*rolling blackouts should be inflicted on all of us to force energy conservation;

*if we all were forced to live in caves, it would be "greener."

*and he hasn't seen a roundabout he didn't love.

so much for democracy.

Flap Doodle 6 years, 7 months ago

merrill, are you willing to pony up the $ to make Lawrence one of the bike capitols of the world? It probably won't be cheap.

ljwhirled 6 years, 7 months ago

It would be nice though. I would love to ride/jog to work, but not through traffic.

A great first step would be to finish the SW traffic way and run the running trail/sidewalk all the way out to Haskell Ave.

Then connect that trail with the trail going north.

You could ride from Clinton Dam all the way to downtown without having to fight with traffic.

Kate Rogge 6 years, 7 months ago

1.3 million for 49 "affordable housing" units smack dab next to the railroad tracks. Wow. What's not to like?

Carol Bowen 6 years, 7 months ago

The city has backed itself into a corner. The commission approved assistance for the Masonic Lodge. How can they not approve a request for the Poehler building?

-The commission is in no position to decide which plan would be successful if not both. -Of the two projects, rent controlled housing would benefit the community more by providing a different market for long term tenants.

I did not like funding for the Masonic Lodge. Now, the city has set a precedent.

Carol Bowen 6 years, 7 months ago

LarryNative, interesting. So, do we provide assistance only to "needy" businesses or to businesses that develop what we want. Should we focus on local developers only? What should our criteria be?

Commenting has been disabled for this item.