Entries from blogs tagged with “Town Talk”
City delays final vote to deny shopping center at SLT and Iowa; issue of what city wants developed at intersection still unclear
I certainly know a thing or two about backtracking. When you live in a house with a 12- and a 9-year-old you get to hear plenty of it. When you “complete” home improvement projects the way I do, you certainly get to practice it too. (I never said the staircase would go all the way to the bottom.) So, I’ll be interested if I hear any backtracking from the City Commission meeting as it relates to a proposed shopping center at the intersection of the SLT and Iowa Street.
We were scheduled to hear the commission discuss the shopping center issue at tonight’s meeting. They were asked to approve a legal document officially denying the proposed shopping center. But on Tuesday morning, City Hall sent notice that a vote on the matter would be delayed by at least one week.
I’m not sure what is causing the delay, but I certainly don’t expect commissioners to change their vote from last week and now allow the approximately 250,000-square-foot shopping center at the southeast corner of Iowa Street and the SLT. It sure appears that decision is done. That site won’t house anytime soon an Academy Sports, an Old Navy or any of the other retailers that were planning on coming to the center.
But it will be interesting to see if commissioners seek to massage the message they are sending by denying the project. As I wrote last week, I was not surprised commissioners voted to deny the shopping center proposal. I was surprised at one of the key reasons they used to deny the project: that the city is not ready for development south of the South Lawrence Trafficway.
I thought that was a surprising position to take given that the property in question has been part of the city limits since 1979, and that the City Commission just two years ago approved a plan for the area that stated the property was suitable for auto-related commercial development.
People who invest millions of dollars to develop in this community look for signals from the City Commission. Having a piece of property in the city limits is a signal that it is ready for development. Having a planning document that spells out a commercial use for a piece of property is a signal that it is ready for development. Combine those two, and developers view it as a green light.
Last week’s denial of the plan has shifted the light to yellow. Commissioners said they didn’t want a shopping center at that site. People can argue about whether that is a good decision, but it is a decision consistent with the city’s plan. To be fair, the city never sent a signal that it wanted a shopping center at that corner. Developers were testing the waters, and it appears that test is now complete, at least with this City Commission.
But as part of last week’s denial, commissioners ended up sending another signal. At least three commissioners have said they think the Revised Southern Development Plan — the plan approved two years ago that says the property should develop as an auto-related commercial center — needs to be revisited. That’s sending a signal that the city is no longer sure any type of commercial development — or perhaps any type of development at all — should occur on the property just south of one of the larger intersections in all of Douglas County. Again, the light shifts to yellow, and the question is whether it will turn to a full red.
Simply put, commissioners must decide whether they want to send a signal that an auto-related commercial use would be appropriate for the intersection. That could be something like a new car dealership, or a complex of hotels to attract travelers off the highway, or a large fueling center, or some combination of all of the above. Again, you could argue why the city would rather have that type of development at the intersection than a major shopping center, but it doesn’t seem like that argument is going to go anywhere with this commission. That makes the more interesting argument one of whether the intersection should have any commercial development. A new car dealership at the site, for example, certainly could be a significant sales tax generator for the community.
Commissioners were scheduled to discuss the subject tonight, but now have delayed the discussion for a week. Commissioners will be asked to approve a legal document called a “findings of fact.” It basically is a document written by a city attorney that spells out why commissioners denied the project last week. As you may guess, it is usually not a good sign when you have to ask an attorney to write a document explaining why you did something. It is a mechanism used to put the city on a good legal footing in case the city gets sued over the denial. I don’t know how likely a lawsuit is in this matter, but the city doesn’t like to take chances with such issues.
You can read the entire document here. It lists several reasons for denial, but it is interesting to note that it does not state that the city isn’t prepared for development south of the SLT. Instead, the document basically says that a shopping center at that intersection doesn’t comply with the city’s comprehensive plan. The comprehensive plan calls for something like a car lot or hotels or some other auto-related use. This legal document that the city is being asked to approve still contemplates that a commercial use is foreseen for the intersection. Is that the message the City Commission intends to send, or does it still intend to send its yellow light message of “We’re not sure what ought to be built there"?
City commissioners last week could have denied the shopping center project by simply saying “we have a plan for that intersection and we’re not interested in changing it.” But commissioners didn’t say that. Instead they said something along the lines of “We have a plan for the intersection, we don’t want to change it to allow a shopping center there, and furthermore, we’re not sure we like the plan we have.”
The last part of the statement has produced some questions that it seems the commission will have to answer at some point:
— What type of development do they want at the intersection? Is an auto-related commercial center appropriate there? Is any type of commercial development appropriate there? These questions are the ones that seem to be frustrating significant numbers of the public. I have heard, by far, from more members of the public who are disappointed with the commission about this issue than people who are pleased with the commission. Their frustration seems to be that they thought the commission already had planned for this intersection and sent the signal that some form of commercial development was appropriate. Their second point of frustration is one of timing. The South Lawrence Trafficway has been in the works for more than 20 years. It has been easy to predict that this intersection would be a focal point of development pressure once the SLT was completed. The SLT is now near completion, the development pressure is hot, and the city is still trying to figure out what it wants for the intersection.
— What type of incentives is the city willing to offer big box retailers? With last week’s denial, this City Commission has decided it doesn’t want big box retail on that property. The site that is most well-positioned to accommodate multiple big box retailers is the property near Rock Chalk Park in northwest Lawrence. It is zoned and ready to go, but has not attracted any tenants for the last several years. Does the City Commission have a good understanding of why that development hasn’t attracted any tenants? Does the city believe some type of financial incentive will need to be offered to entice a retailer to go to that far northwest location? Does the city have a different plan for attracting retailers to the community?
— How important is it to add new retail options in Lawrence? I think this one produces a variety of viewpoints both on the commission and in the community. What is clearer is that City Hall budget makers are counting on significant amounts of retail growth to make the city’s budget work. I wrote last week about how Lawrence had one of the higher growth rates of sales tax collections in the state in 2015. Sales tax collections grew by 4.7 percent. That was good news, but the growth rate still fell short of what city officials were hoping for. City budget makers had projected a 5 percent sales tax growth. More importantly, the city has budgeted for a 5 percent growth in sales tax in 2016. That’s a more aggressive projection than what City Hall has normally used. In the past it has budgeted for growth rates closer to 3 percent. In short, City Hall is betting on more sales taxes.
Does the city need more retailers to produce those sales taxes? I don’t know, but it is a question that Lawrence taxpayers have a vested interest in seeing answered. One way or another, the city’s budget will need to balance.
For many years, parents of KU students were under the impression that their children were getting a fine education in all things nautical. After all, the credit card statement kept showing visits to The Yacht Club. Come to find out, The Yacht Club was a bar and grill. As we previously reported, it closed in June, but now there’s news the longtime establishment has reopened under new ownership.
A pair of radio personalities with K.C. country music station Q104 — Mike Kennedy and Whitey Whitney — have reopened The Yacht Club, 530 Wisconsin. The bar and grill reopened last weekend. Don’t let the new owners’ country music background fool you into thinking The Yacht Club is soon going to become The Country Club. Neither a name change nor a format change is on tap.
“We would never change the name,” said Alex Adams, manager of the establishment. “There’s too much history with the name.”
As for the music and feel of the place, the club is expected to focus on being laid-back, whether that involves country, rock or some other type of music playing from the jukebox.
“We just want to have an upbeat and good-time vibe,” Adams said. “We will always have music playing, we’ll always have games on, and we’ll have food too.”
The business is rolling out a new menu. It will have a heavy emphasis on bar food that can be delivered quickly. That includes appetizers like Yacht Knots, which are a pair of Bavarian pretzels with a craft beer cheese sauce and bistro mustard. Hamburgers with lots of topping options also are on the menu, as well as a breaded pork tenderloin sandwich called the Titanic Pork T.
The club definitely will keep its sports bar theme with about 15 televisions, pool table, shuffleboard, foosball, and the giant KU basketball scoreboard that hung on the wall for so long remains in place.
The new owners — Kennedy and Whitney — have some experience in the bar and restaurant business. The duo also owns JT’s Sports Bar and Grill in De Soto, Adams said.
Plans call for the business to open at 11 a.m. each day and serve a lunch menu. The kitchen will close at 10 p.m. or 11 p.m., depending on the night. The bar will remain open until 11 p.m. or 2 a.m. depending on the day of the week.
New grocery chain coming to the area with store, fueling center; update on Church’s Chicken speculation
I know on that long drive from Lawrence to Johnson County, I often times need to restock my supply of Doritos, Twinkies, hair gel and other necessities for surviving in the big city. Well, plans have been approved for a large, new grocery store at the K-10 interchange at De Soto that may well appeal to Lawrence commuters. The project also is noteworthy in that it will bring a new grocery chain to the region.
Harps — an approximately 80-store chain based in Springdale, Ark. — has reached a deal to build a new 32,000-square foot grocery store/pharmacy/fueling center at the Lexington Avenue interchange at De Soto. If you are familiar with the Pizza Hut location near that interchange — and since that looks like pepperoni stuck in your heater vent, I think you are — you know where the store will be located. It will be built on the vacant property just east of Pizza Hut.
Plans call for the store to have a full line of groceries, a deli, a bakery, a pharmacy, and most Harps also have a convenience store within the store, said Cynthia Wagner, city administrator. Plans approved by the city show four fueling islands.
Wagner said the city of De Soto approved a tax increment financing district for the project, which will be used to help pay for public infrastructure at the site. De Soto has been without a grocery store for about four years, and Wagner said getting a grocer to the community has been a major goal. Wagner — who, if you remember, used to be an assistant city manager in Lawrence — said the location right along K-10 is designed to also make it easier for commuters to use the location too.
“We sure hope to be able to capitalize on a lot of the commuters who drive by the location,” she said.
The regional grocery industry also is likely to take notice of the deal. The deal represents an expansion into new territory for Harps. The chain currently operates in Arkansas, Oklahoma and Missouri, but the company notes on its website that it has “aggressive growth plans.” It looks like the farthest north the company is currently located is Joplin. It seems unlikely that this will be the only Harps store planned for the Kansas City area, but I’ve heard no real talk of the company looking at Lawrence. It may be more likely that the company is looking at the Kansas City metro market. But, I’ve got a call into an executive with the company to find out more.
In a voicemail from one of the company executives, he said he hopes construction work will begin this spring and the store could open in the fall of 2016. He estimated the company — which is a privately-held, employee-owned company — would have about 60 employees, with about half of them being full-time positions.
In other news and notes from around town:
• As we previously have reported, there is a full-scale effort underway to correct the obvious deficiency in fried chicken options in Lawrence. Buffalo Wild Wings, Chick-fil-A, Popeyes, and Raising Cane’s all have either opened or will open new locations on south Iowa Street. Wing Stop is opening in the Louisiana Purchase shopping center on 23rd Street. And we previously have reported that a chicken chain has filed plans for a drive-thru restaurant at the Bauer Farm development near Sixth and Wakarusa. But a name hasn’t yet been released for that project.
All the great chicken minds in town, though, have been speculating that it is a Church’s Chicken. Folks in the commercial real estate industry have indicated that Church’s has been interested in the Lawrence market at various times. But a person familiar with the development has told me it is not a Church’s that will be going into the location. No word yet on what it is though. The development group is being quiet thus far. But I’ll keep an ear open.
In the meantime, all us great chicken minds will have to get back together again and create new speculation. I say we meet at the pharmacy. We can have a good discussion while workers pack our boxes of cholesterol medicine.
New sandwich shop coming to southern Lawrence; car dealership buys property along south Iowa Street; advocate to sell KU versus Kentucky basketball tickets to raise money for affordable housing
There’s a new sandwich chain coming to south Iowa Street, and I’ll be honest, it has me worrying about my penmanship. The sandwich chain Which Wich is coming to a shopping center near 26th and Iowa streets, and will bring its unique concept that involves customers writing out their own orders with a Sharpie.
Which Wich is going into the Tower Plaza property, the shopping center that includes First Watch and that is next door to Applebee's on south Iowa. In recent weeks, we’ve reported that and the quick order pizza shop Pie Five also are going into the center, which currently is undergoing a major renovation.
Which Wich is a sandwich chain that got started in Dallas in 2003 and has been growing rapidly ever since. The company makes sub sandwiches but does so in a way that's a bit different from, for example, Subway. Customers go to a wall that is full of empty bags. Each bag has a different number that corresponds to a broad category, such as ham, beef, chicken, seafood, vegetarian, Italian and other types of sandwiches.
Then, you take a Sharpie pen and start marking up the bag with your specific sandwich instructions, like your choice of toppings and such. This part excites me because, for reasons we don’t need to get into at the moment, I am specifically prohibited from possessing a Sharpie at home. The process ends by you marking your name on the bag, taking it to the counter and then waiting for your name to be called. This part concerns me because I doubt the restaurant will have a specialist in hieroglyphics on staff, which many a member of the Journal-World newsroom will tell you is a necessity if you hope to read my handwriting.
After you're done eating your sandwich, the restaurant encourages you to keep playing with the Sharpie by drawing on the back of your sandwich bag and then hanging it up in special part of the store. (Warning: Sharpies use permanent ink, or something pretty close to it. There’s a year’s worth of photos of me wearing a stocking cap pulled low over my forehead to prove it.)
As for the sandwiches, the company’s website indicates there are lot of options to choose from. There are Hawaiian and Cuban style ham sandwiches, barbecue pork sandwiches, cheesesteaks, corned beef, reuben, chicken parmesan, muffulettas, gyros, five different styles of Italian sub sandwiches, and some more unique offerings such as an Elvis Wich, which includes peanut butter, bacon, honey and bananas, and a Monte Cristo, which is ham, turkey, grape jelly and a sprinkling of powdered sugar.
The company also offers a speciality sandwich called the Wicked, which features five different meats. The restaurant gained some national notoriety in 2010 when a customer dislocated his jaw when trying to bite into a double-meat version of the Wicked sandwich. (I believe the Sharpie came in particularly handy then. I think he wrote 9-1-1 on his forehead, but I might have that confused with another incident.)
The restaurant also offers breakfast sandwiches and serves malts and milkshakes. The restaurant will be the company’s first in Lawrence. It has opened restaurants in Emporia and Manhattan, and has one in the Wesport district of Kansas City, Mo.
A sign has gone up announcing the restaurant is coming to Tower Plaza, but I don’t have a timeline on when to expect an opening.
In other news and notes from around town:
• It is time to keep an eye on the south Iowa Street property that houses Advanced Homecare/Breathe Oxygen & Medical Supply. A company led by the owner of the Briggs Auto Group recently has purchased the Breathe property at 2851 Iowa St. and 2101 W. 28th Terrace, according to land records at the Douglas County Courthouse.
Those two properties are right in the heart of the Lawrence Auto Plaza, where Briggs currently operates a number of dealerships. I called Briggs’ headquarters in Manhattan. A spokeswoman there confirmed the purchase but said details on what the company plans to do with the property aren’t yet ready to be released. But she said Russell Briggs, owner of the auto group, did say “something is in the air,” and he plans to share more information in the coming weeks.
The Breathe Oxygen & Medical Supply store remains open at the location. A company official with Breathe didn’t return phone calls seeking comment.
It will be interesting to watch what Briggs has in mind for the property, which has high visibility from south Iowa Street. In recent years, Briggs has spent millions of dollars renovating and updating its existing dealership locations in Lawrence.
• Speaking of spending millions of dollars, that probably will be the case when the Kentucky basketball team comes to town to take on the Jayhawks on Jan. 30 at Allen Fieldhouse. (I figure we’ll spend $1 million alone just buying enough film to make sure we capture all the antics of Kentucky super fan Ashley Judd.)
Well, one Lawrence resident is wanting to make sure some of that money for the big game goes towards helping solve the community’s affordable housing problem. Steve Ozark, an owner of a Lawrence-based talent company and a longtime advocate for the homeless and affordable housing, is donating his two tickets to the KU-Kentucky basketball game for the local nonprofit Tenants to Homeowners to sell. Ozark said 100 percent of the money raised through the sale of the tickets will be given to the city of Lawrence’s Affordable Housing Trust Fund, which just recently received a new board of directors appointed by the city.
The board is in the early stages of coming up with an idea for a pilot project that could demonstrate how the community can offer more affordable housing options.
“I figured the biggest rematch at Allen Fieldhouse in modern history would be an opportunity to draw attention to the shortage of affordable housing in Lawrence and the need for a dedicated revenue source for the Affordable Housing Trust Fund,” Ozark said via email.
The city’s trust fund has dwindled to about $100,000, in part because the City Commission hasn’t determined a dedicated revenue stream for the fund.
As for the basketball tickets, the pair of tickets will go on eBay tonight at 9 p.m., and bidding will last through 9 p.m. Jan. 24. You can find out the specifics about the tickets and get to the appropriate location to bid by searching "KU/KY Basketball Tickets" on eBay's homepage.
There’s no telling how much the tickets may bring. The KU vs Kentucky game is definitely a hot ticket. Tickets on the reselling site StubHub start at about $500 and quickly go up from there. There are several tickets for sale at $3,000 and above. There are even 12 tickets for sale in the center G section of Allen Fieldhouse — right near the floor — that are priced at $27,000 apiece.
Plans filed for major soccer complex near eastern end of SLT; Kansas ranks near top of list of states people are leaving
The first new development to go along the edge of the soon-to-be-completed South Lawrence Trafficway probably won’t be a new shopping center, but rather may be a big soccer complex. Plans have been filed for a multifield soccer facility near the eastern end of the SLT.
A nonprofit organization called Jambars Futbol Club Inc. has filed plans to build five full-length soccer fields, five separate training areas, a more than 200-space parking lot, and a 6,000 square-foot building for concessions and such on property near the “ski lake” that is just south of Kansas Highway 10.
The group has filed for a conditional use permit for 80 acres of property at North 1300 Road and East 1750 Road. If you are still confused about the location, it is near the spot where the South Lawrence Trafficway begins to look like my tie after a spaghetti dinner. Perhaps this Google map will help. It is the property just to the southwest of the ski pond.
Joe Comparato is the director of the soccer club. He’s also a soccer coach at Bishop Seabury Academy, one of the private schools in Lawrence. Comparato told me multiple people are involved in the proposed venture, and he envisions the soccer facility would be used by a variety of organizations. Comparato wants to use the facility for the training academies he runs, and he said Bishop Seabury is looking for a home to host its soccer teams. In addition, he said the Lawrence Adult Soccer League is looking for field space. He expects some youth soccer organizations to be interested in field space as well.
“I’ve been promoting soccer my whole life, and people like me keep saying ‘it's coming, it's coming,” Comparato said. “Well, I think it has finally arrived. The popularity of the game has reached a certain point in this country, but as the popularity of the game grows, it is going to take more space and more facilities.”
The plans filed with the Lawrence-Douglas County Planning Department show the site — which is owned by a trust controlled by the Pendleton family — at 80 acres, but Comparato said the immediate plans call for developing only about 40 of the acres.
Lawrence does have a soccer complex today. The Youth Sports Complex— or YSC — below the Clinton Lake Dam includes 23 soccer fields. The city of Lawrence operates the facility. But Comparato said it is difficult to get time on the city-owned fields. The popular Kaw Valley Soccer Association has an agreement with the city that allows that youth soccer league to take many of the available time slots for the facility.
Comparato said it is not unusual for soccer clubs in Johnson County to build their own facilities, and that model sparked the idea here. As for the proposed plans, the five fields would each be 360 feet long by 225 feet wide. The plans call for at least one of the fields to have lights, with lighting perhaps being added to other fields in the future.
The proposed site is one of the more visible properties in Lawrence. Thousands of vehicles travel by the site every day on Kansas Highway 10, and traffic volumes are expected to increase significantly as the SLT bypass project is completed later this year. The soccer complex, if approved, will be a bit of a gateway into the community.
The request comes shortly after commissioners rejected one development proposal at another soon-to-be-completed SLT intersection. Commissioners last week rejected a development plan for a new shopping center at the southeast corner of the SLT and Iowa Street interchange, in part, because they said they didn’t feel development was ready to cross the trafficway.
That perhaps could be an issue in this area too, but there is one large difference. The soccer group is not asking for any city approvals. The property currently is not in the Lawrence city limits, and the group is not seeking annexation.
“We don’t see any need to be annexed,” Comparato said.
Comparato said he thinks the soccer facility will fit in well with the county’s plans for the area. He notes that it is right next to the ski lake, so there is already a recreational feel to the area. He doesn’t expect the major intersection to come under heavy development pressure anytime soon.
“If they turned that one project down on south Iowa Street, I figure it will be a long time before they let anything build out here,” Comparato said.
The soccer project will have to win approval from both the Lawrence-Douglas County Planning Commission and the Douglas County Commission before it can proceed. The project is expected to have a hearing before the Planning Commission later this month. If the project wins its approvals, the project could begin construction this spring.
In other news and notes from around town:
• Maybe it is because we don’t have enough soccer fields — or perhaps there is some other reason — but Kansas didn’t fare well on a new study that measures the number of people moving in and out of the state.
The large moving company United Van Lines recently released its 39th annual edition of a study that tracks how many people it helps move into states and how many it helps move out of states. In 2015, Kansas had the sixth highest move-out rate of any state in the country.
The study found that 57 percent of all the business it did in Kansas was related to people moving out of the state, while 43 percent was related to people moving into the state. Kansas was the only Plains region state to be in the top 10. Here’s a look at the 10 states that had the highest move-out rates:
— New Jersey: 66.6 percent
— New York: 64.6 percent
— Illinois: 63.2 percent
— Connecticut: 62.6 percent
— Ohio: 58.4 percent
— Kansas: 57.3 percent
— Massachusetts: 57.2 percent
— West Virginia: 57.1 percent
— Mississippi: 56.3 percent
— Maryland: 55.2 percent
To be clear, though, most of our neighboring states didn’t exactly tear it up in this category. Missouri had a 55.2 percent move-out rate, Oklahoma 51.7 percent and Nebraska 51.3 percent. (I take comfort in believing that the move-out rate would be higher in Missouri, but several folks didn’t want to take the time to take the car off the cement blocks. What? It is basketball season. I feel incomplete if I don’t make a Missouri joke.)
As for the states that were attracting the most move-ins, here are the top 5:
— Oregon: 69 percent
— South Carolina: 62.4 percent
— Vermont: 62 percent
— Idaho: 60.5 percent
— North Carolina: 58.9 percent
United does survey some of its customers about their moves. Traditional reasons such as job availability and being near family rank near the top of the list. The survey, though, noted some emerging trends, including the desire to be located in high-tech and areas that have creative-based economies, and a desire to have more outdoor activity and green space.
The United study isn’t definitive because it is just a look at one company’s activity, but it matches some concerns state leaders have been highlighting. A lack of strong population growth, especially in the younger age set has been highlighted as a concern by the governor and others.
Lawrence sales tax growth in 2015 among the tops in the state; city confirms special taxing district at Oread hasn’t reported for last two months
We may argue about whether or where we want new retail development to occur in Lawrence, but it hasn’t done anything to slow shoppers from stuffing their carts in 2015. New numbers show that Lawrence’s sales tax collections were near the top of the list for fastest-growing in the state.
The city received its final sales tax check of 2015 from the state recently, and it was a big one. The check covered sales taxes collected basically from late September to late October. Based on the numbers, I guess my house wasn’t the only one that had to add an extra room to store the Halloween candy. Sales tax collections were up 11 percent compared with the same period a year ago.
For the entire year, Lawrence sales tax collections grew by 4.7 percent. That number is impressive for a couple of reasons. It is better than the 4.1 percent growth rate posted by Lawrence in 2014. Even more noteworthy is that Lawrence’s growth rate was among the tops in the state. Here’s a look at the major retail centers across the state that I normally track:
— Lawrence: up 4.7 percent
— Kansas City: up 4 percent
— Sedgwick County: up 2.9 percent
— Johnson County: up 2.7 percent
— Salina: up 2.6 percent
— Manhattan: up 2.3 percent
— Lenexa: down 1.2 percent
— Topeka: up 1.0 percent
— Overland Park: down 0.7 percent
The only major retail community — I define that as more than $10 million in local sales tax collections — that posted a stronger growth rate than Lawrence was the city of Shawnee. Its sales tax collections grew by a whopping 20.1 percent, according to numbers from the Kansas Department of Revenue. I’m guessing what happened there is that Johnson County residents finally figured out how to hook up full-length semi-trailers to their SUVs. Actually, the editor of the Shawnee paper, which is owned by the parent company of the Journal-World, tells me that it probably had more to do with some existing shopping centers in Shawnee attracting new tenants, but the jury is still out on why Shawnee’s retail scene exploded in 2015.
In Lawrence, the retail scene was uneven in 2015. Lawrence posted a lot of its growth in sales tax collections in the first half of the year, and then sales really leveled off until the November and December reports. (Remember, though, sales tax collections lag, so reports in November and December really were measuring sales more in September and October.) Those two months picked up steam. The next couple of reports will show how much activity retailers were seeing during the Christmas holiday season.
It also is important to remember that the sales tax numbers don’t represent just retail sales from stores and such. Sales tax also is charged on utilities, construction materials and lots of other products. The city put together a chart showing what type of sales are producing sales tax revenues. Here’s a look:
— Retail stores: 21 percent of the total
— Motor vehicle and parts: 14 percent
— Food and beverage stores: 13 percent
— Food service and drinking places: 12 percent
— Other: 12 percent
— Utilities: 7 percent
— Building materials: 5 percent
— Other services: 5 percent
I’m looking for a similar type of chart that shows what the breakdown is for the state as whole or perhaps some other large communities. That could provide some interesting information about how Lawrence’s retail scene is similar to or different from other communities.
It will also be interesting to watch the above numbers over the next couple of months, particularly the building material category. The December sales tax report was the first one that included sales from the new Menards home improvement center. City officials aren’t allowed to release any information that would identify a particular retailer, but Bryan Kidney, finance director for the city of Lawrence, told me this morning that the city has seen a notable increase in the amount of sales tax collections attributed to the building material category.
The city will need to see some increases in that category and others to make its 2016 budget. The city has budgeted for about a 5 percent increase in sales tax revenues in 2016, which is one of the more aggressive growth percentages the city has used for budgeting purposes.
The city fell just below that mark in 2015, although some year-end adjustments may get the city to the 5 percent mark. (January 2016’s sales tax report will actually be added to the 2015 totals and January 2015’s report will be dropped from the totals. It is the difference between cash basis accounting and accrual accounting. Wake up! I promise I’m done talking about accounting methods.)
Kidney said he’s still feeling good about the 5 percent growth projection for this year.
“The square footage of retail space has increased in the last quarter of this year, so with that being the case, we think 5 percent is still reasonable,” Kidney said.
In other news and notes from around town:
• There was another interesting item in the city’s most recent sales tax report. It appears that some sales tax information from the Oread hotel area was not filed with the state. The Oread hotel development is part of a special taxing district, and it has come under scrutiny from City Hall. A city-hired auditor has produced a report alleging that some sales totals have been inflated at the Oread project in an effort for the development group to receive a larger sales tax rebate. Those allegations currently are being disputed by the Oread development group.
Kidney in his report to city commissioners noted that one of the three special transportation development taxing districts that operate in the city “did not report sales taxes for December.” When I chatted with Kidney this morning, he confirmed it was the Oread special taxing district that did not report.
Kidney said he couldn’t comment on the lack of the report. Looking into it a little deeper, I found another memo from November that indicates the Oread did not report sales taxes for that month either.
It is unclear whether that means that the development isn’t remitting sales taxes to the state at all, or whether the state has put a hold on distributing those taxes to the city of Lawrence or something else. We’re checking on trying to get an explanation from the Kansas Department of Revenue, which oversees sales tax collections in the state.
The transportation development tax is an interesting one because it is an extra 1 percent sales tax that is charged on all purchases made at the Oread development. I’m pretty sure consumers are still paying that special tax, so figuring out why it isn’t being reported seems important.
Lawrence included in national study of communities with best and worst credit scores; Lawrence getting hammered in voting for best Midwestern city
Usually in January, I try to hide from all credit card-related news. But I’ll come out of my El Chapo-like tunnel system long enough to pass this information along: Lawrence scores relatively well in a new financial study that measures credit scores across the country.
The financial website WalletHub has partnered with credit card data company TransUnion to examine the credit scores of individuals in 2,750 communities across the country. The study created an average credit score for each community, and then ranked the communities. Lawrence ranked above average, scoring in the 62nd percentile. In case percentiles confuse you much like the concept of compounding interest does, the 99th percentile is best, the 1st percentile is the worst and the 50th percentile is average.
Lawrence’s average credit score was determined to be 683. I believe the top score possible is 850. A community called The Villages in Florida had the top community average at 779. There were 38 communities that were in the 99th percentile. Only 15 states had communities that made that elite group, but Kansas was one of them. Leawood was in the 99th percentile with a score of 742. That was the 16th highest average in the country.
Here’s a look at how some other Kansas communities and cities in the region scored:
• Leawood: 99th percentile; 742 score
• Overland Park: 84th percentile; 706 score
• Lenexa: 83rd percentile; 706 score
• Iowa City: 80th percentile; 702 score
• Ames, Iowa: 80th percentile; 701 score
• Shawnee: 78th percentile; 699 score
• Manhattan: 72nd percentile; 693 score
• Olathe: 69th percetile; 690 score
• Columbia, Mo.: 67th percentile; 687 score
• Lawrence: 62nd percentile; 683 score
• Morgantown, W.V.: 58th percentile; 679 score
• Norman, Okla.: 49th percentile; 671 score
• Stillwater, Okla.: 47th percentile; 669 score
• Hutchinson: 47th percentile; 669 score
• Salina: 44th percentile; 666 score
• Austin: 43rd percentile; 665 score
• Topeka: 41st percentile; 664 score
• Lubbock, Texas: 23rd percentile; 648 score
• Kansas City, Mo.: 26th percentile; 650 score
• Waco, Texas; 9th percentile; 632 score
• Kansas City, Kan. 4th percentile; 621 score
I thought WalletHub hit upon a neat idea to rank communities using this metric because it does provide a look at what communities have large numbers of residents feeling some level of financial stress. I’m sure there are other reasons your credit score can be low, but falling behind on your bills is one of them.
Lawrence is on the correct side of the average line in this study, and the difference between Lawrence and Kansas City is stark. The numbers also reinforce just how much of an economic powerhouse Johnson County has become. The numbers also show that being a college community doesn’t preordain you to being middle of the pack or worse. Both Ames and Iowa City are in the 80th percentile. Then there are college communities like Waco. It has a beautiful, new, expensive football stadium. Apparently, every resident put a portion of the price tag on his or her personal credit card.
In other news and notes from around town:
• There’s good news and bad news on one other ranking front for Lawrence. The good news is Lawrence has been chosen as one of 12 finalists for Midwest Living magazine’s Greatest Midwest Town of 2016. The bad news is that we’re getting hammered in the voting.
Based on photographs that readers sent in to the editors of Midwest Living, Lawrence was chosen as one of the 12 finalists. Voting began on Jan. 1, and as of Monday morning, Lawrence had 67 votes.
That put us No. 10 out of 12. We’re ahead of Columbus, Ind., and Medora, N.D. This needs to change because putting a sign out at the edge of town proclaiming we’re better that Medora is going to look strange. Here’s our competition and where they stand right now:
Traverse City, Mich.: 1,525 votes
Put-in-Bay, Ohio: 1,110 votes
Galena, Ill.: 637 votes
Duluth, Minn.: 414 votes
Nebraska City: 371 votes
Bayfield, Wis.: 334 votes
Decorah, Iowa: 323 votes
Rapid City, S.D.: 285 votes
Branson, Mo.: 206 votes
Lawrence: 67 votes
Columbus, Ind.: 42 votes
Medora, N.D.: 21 votes
The winner of the contest will be the subject of a feature article in an upcoming edition of Midwest Living magazine. In case you are wondering how Lawrence is described to voters, the editors describe the community as “peppered” with Civil War sites, and having a nice mix of “highbrow culture and down-to-earth fun.” The Natural History Museum, the Dole Institute and Allen Fieldhouse are all mentioned as attractions. Massachusetts Street also gets a mention, as does our “highly respected local music scene.”
People have until Feb. 29 to vote. You can vote multiple times, but only once per day. Go to midwestliving.com/vote to cast a ballot.
UPDATE: Following this article and some activity social media today, Lawrence gained a good amount of ground in the voting. At a little after 4:30 p.m. on Monday, Lawrence had 555 votes and was up to No. 4 on the list.
Fritzel family takes over ownership of Alvamar; some renovation work begins with much more on the way
Members of the Fritzel family now own the Alvamar Golf and Country Club, and renovations to the west Lawrence property are already underway.
As we previously have reported, a group led by Lawrence businessman Thomas Fritzel has been working to purchase the country club. Members of the club were recently notified by letter that members of “the Gene Fritzel family” have bought the property. Gene Fritzel is Thomas’ father and a longtime building contractor in the area. According to records with the county, though, Thomas Fritzel is still very much a major part of the ownership group. A trust of Thomas Fritzel and Stacia Fritzel are shown as the new owners of the property near the clubhouses, and a newly formed company called Eagle 1968 LC owns other parts of the club. Thomas Fritzel is listed as the resident agent of the Eagle entity, but it is new enough that the state doesn’t yet have documents on file listing the shareholders of the company.
In due time, there will be a lot that is new at Alvamar. As we previously have reported, the ownership group has filed plans for major renovations at the club, including the addition of many more apartments and living units around the course. Several folks who have booked events in the banquet space of Alvamar are already being affected by the renovations.
A local caterer called me and said several people had contacted him looking for event space because the Alvamar banquet facility — which is in the private members' clubhouse — has been temporarily closed. An employee at Alvamar confirmed renovation work is underway at the clubhouse, and it likely will be closed for a couple of months. I’ve got a call into the general manager of the country club to get more details, but it sounded like new flooring, paint and other amenities were being updated in the distinctive clubhouse building, which I’m almost certain was built by Gene Fritzel several decades ago.
I’ll let you know when I get more information.
I do have additional information on some of the redevelopment plans that have been filed at the city. Lawrence architect Paul Werner has filed a final development plan for the portion of the club that is near the clubhouses. It provides more detail about what’s in store than any of the other plans filed thus far. Here’s a look:
— A new two-story, 24,000 square-foot clubhouse, fitness and wellness center is planned for the area near the entrance to the current driving range of the course.
— Four swimming pools will be added to the property. They include a 50 foot by 80 foot pool with a slide, a 30 by 50 foot lap pool and a pair of smaller pools that are 16 by 24 and 16 by 16 foot. The pools will be surrounded by about 6,000 square feet of cabana space. The pool area also will include a 2,500 square-foot grill area. The pools are proposed to be concentrated in an area kind of near where the public clubhouse is located today. That clubhouse will be removed.
— Kansas University is proposed to get a larger training facility for its golf team. Plans show a 4,000 square- foot building for the team. Currently, the team has about 1,300 square feet of space at the golf course. The new building will be farther to the east than the current facility.
— A two-story banquet facility that will include 24 guest rooms. Werner previously has said the facility will operate as a minihotel that serves wedding parties who are expected to rent the attached banquet facilities. The guest rooms are also expected to be available to golfers who want to stay overnight at the course. (That’s a good idea. I know if I don’t get started before 8 a.m., it can get really dark before I get my 18 holes completed.) The plans list the facility at 20,000 square feet, but the plans don’t make it clear whether the total facility is 20,000 square feet or whether each floor is 20,000 square feet. The facility is proposed for an area east and south of the existing public clubhouse.
– 2,400 square-foot “sports medicine office” that would be south of the new banquet facility. The city’s planning department said it hadn’t received more information about what would be included in that facility. (Another brilliant idea: A doctor’s office at a golf course. Just think how much gas physicians could save if they didn’t have to drive from their office to the course.)
Sandra Day, the lead planner reviewing the project for the Lawrence-Douglas County Planning Department, said the final development plan must win approval from the Planning Commission before the project can move forward. The group hopes to get a hearing at the Planning Commission in February, but Day said planners likely will need to see more details before it is ready to go to the commission. She said the filings don’t yet include elevations showing how each of the new buildings will be designed.
It is important to remember that the latest plans are only for a portion of the project at Alvamar. The part of the project that involves building new apartments and living units around the course is not included with this most recent filing. (Although you can see some of the apartment buildings on the submitted plans, but they show up just for context.) It will be interesting to watch those plans come forward. The city has approved a preliminary development plan that calls for nine multifamily buildings that would house a total of 292 living units.
The final development plan will provide more detail about where those buildings are located and what they’ll look like. As I mentioned above, the most recent plans aren’t for the living units, but they do provide a glimpse at what is to come. It looks like there definitely will be some new opportunities for luxury living in the community. The plans show one four-story building right north of the new pool area for the country club. The plans also show another four-story building just to the west of the proposed pool area.
Also expect significant changes to the golf course design. The new owners have committed to keeping 36 holes of golf at the facility. The new plans, though, do show new locations for both the No. 9 and No. 18 greens. No word yet on when those changes will begin.
The letter to members, however, indicated some more minor changes to the golf course are already underway. It noted crews will be removing and thinning some trees to improve the quality of play and turf conditions. (Sure, they can cut down trees, but when I pull a chainsaw from my golf bag everybody gets hysterical.) The new owners have kept Orion Golf Management to oversee the course. Orion has been in charge of golf operations at the club for about the last three years.
Rejection of south Iowa Street shopping center sends confusing signals about future of south Lawrence growth
I guess I shouldn’t be too surprised that this intersection has confused me. After all, for more than a decade it has had a “Bridge to Nowhere.” I’m of course talking about the Iowa Street and SLT intersection, where a bridge that leads to an uncompleted road has stood for years, and likely has confused many a visitor about why we build bridges that don’t lead anywhere.
On Tuesday night, the intersection was the center of debate for the Lawrence City Commission. As we reported, commissioners on a 4-1 vote rejected plans for an approximately 250,000 square-foot shopping center at the southeast corner of the intersection.
I wasn’t confused or surprised that the commissioners rejected the plan. I knew that was a real possibility. But I was confused about the reasoning that some of them gave. Mayor Mike Amyx led the way on the opposition, and gave quite a speech about how the city is not ready to cross over to the south side of the South Lawrence Trafficway.
I didn’t expect that to be an issue on Tuesday night, given that the city already has crossed the SLT at that very point. The property that the North Carolina-based development group was seeking approval for commercial zoning is already in the city limits. It has been in the city limits since 1979. There was no decision on Tuesday night about whether to cross some line.
Commissioners knew that. They were aware the property was in the city limits. In talking with several of them on Wednesday, they seemed to be talking not about the city limits crossing the SLT but about city infrastructure — think water and sewer lines — crossing the SLT.
I did not see that being a stumbling block for this project.
First, city water and sewer lines clearly are headed not just south of the trafficway but south of the Wakarusa River. The city is in the process of building an approximately $50 million sewage treatment plant south of the Wakarusa River. But even without that project, there would seem to be little question that the proposed shopping center site is eligible to receive city utility services. It is, after all, in the city limits. Why would people agree to pay city taxes if the city can’t provide their property basic services?
I asked Amyx on Wednesday if the time wasn’t right for the city to jump the SLT whether the city ought to de-annex the property? He said he wasn’t sure but that “discussion may need to happen.”
That would be a strange turn of events. The city decides — after 37 years — to de-annex a piece of property at what will be at one of the larger and busier intersections in the entire county. Most communities are seeking to annex property in that situation, not de-annex it.
To be clear, I don’t expect the property to be de-annexed. The future of the property, though, will perhaps get discussed. Both Commissioners Lisa Larsen and Leslie Soden told me Wednesday that they think the community needs to have a large discussion about whether to cross the trafficway and what type of development should occur there.
That implies that the community hasn’t already had such a discussion. That’s not accurate. The city has a plan for the area in question. It is called the Southern Development Plan. It dates back to 1994. Then it got revised in 2008, and it got revised again in 2013. That plan spells out how it expects the southern portion of the south Iowa Street corridor to develop. The plan maps out future development south of the SLT, all the way to the Wakarusa River.
The plan shows multifamily development south of the trafficway, lots of open space in the floodplain areas, and for the parcel in question it shows something called “auto-related commercial” development. That has come to be defined as a commercial development like an auto dealership, or a hotel that attracts travelers off of K-10, or some would argue it also could include a truck stop or fueling center.
The North Carolina development group wanted to change the plan to just say commercial development. It wants the same type of commercial designation as the shopping district just north of the SLT, which can house big-box stores and other retailers.
So, to be clear, the developers were seeking that the city change its plans. I would not have been surprised if the City Commission simply said it wasn’t interested in changing its plans. The commission could say it had a well thought-out plan, and that for the sake of consistent long-term planning it wanted to stick to it. That would have caused some grumbling by people who think the city is missing an opportunity in the retail world, but the city could honestly say it was following its planning principles.
But that’s not what the city said. Instead, commissioners are saying they’re not sure they like the plan that was just approved two years ago. Both Larsen and Soden told me they had concerns about an auto-related commercial development for the site. Larsen, Soden and Amyx all said they thought they needed to discuss changing the Southern Development Plan.
As a reminder, the plan was just approved by the commission two years ago. Amyx was on that commission, and voted for the plan at the time. I asked him what had changed in the last two years. He responded by saying he just “doesn’t think the time is right” for development to begin in that area. There seems to be a question about whether our community’s long-term planning is going to change every two years when new commissioners are elected. It probably wouldn’t be the first time.
I tried to reach the fourth commissioner who voted against the project, Stuart Boley, but he didn’t return a call on Wednesday. (In case you are counting, Commissioner Matthew Herbert was the lone yes vote for the project.) Boley said in the meeting that if the city was going to change its plans, let’s do it “intentionally.” I called him because I’m not sure what that means. The proposed plan change — which received a positive recommendation from both the Planning Commission and the city’s professional planning staff — was clearly going through a formal, intentional process. The first plans were filed in early 2014. Some would say that is a lot of process.
Again, my surprise in all this isn’t that the commission rejected this shopping center plan. Reasonable people can disagree on whether this proposal was the right one for Lawrence. There are debates about whether Lawrence has enough income to support more retail. There’s debate about the impact on downtown, and one of the more interesting questions is whether Lawrence is at risk of having too much of its retail space concentrated in one geographic area.
I thought that last one may be the question that ended up causing commissioners to reject the plan. I thought commissioners might say that they are worried south Iowa retail is going to grow at the expense of all other retail areas in the community, and Lawrence would end up like Topeka where the vast majority of shopping is along one street. In particular, I think some city commissioners are worried that the south Iowa Street shopping center would make it difficult for the commercially zoned area around Rock Chalk Park in northwest Lawrence to develop. That area is shovel-ready for retail development, but thus far hasn’t had any takers for several years.
But, you know what, it is kind of politically difficult right now to say that you want to reject a shopping center on south Iowa Street — which was asking for no financial incentives — so that you can give more time for the Rock Chalk Park project to develop. So, commissioners didn’t exactly say that on Tuesday. Instead, they sent an odd signal that they aren’t sure they are ready to develop south of the SLT, even though the city limits already extend south of the SLT. Listen, city commissioners have tough jobs, and they work hard at them. I don’t aim to be too critical here. But people who want to invest money in our community watch for signals from the City Commission. You have to wonder what those people are thinking now.
I’m left wondering how the city ended up in this position. Think about this: The South Lawrence Trafficway project has been underway for more than 20 years. For that entire time it has been known there would be a major intersection at south Iowa Street. It has been easy to predict that when the state decided to invest more than $190 million to finish the disputed SLT project that it would create development pressure in the area. Indeed, the entire south Iowa corridor is under development pressure today, and now the City Commission says it isn’t sure what type of development should happen there. How did that happen?
Surely, no one will suggest the SLT has sneaked up on us.
Like I said, the intersection is a confusing one. Soon, at least, the bridge will make more sense.
Can you cook a fresh pizza in five minutes? I can’t, at least that seems to be the gist of the court order the fire marshall has given me. Lucky for us that there is a new pizza chain coming to south Iowa Street that is all about making handmade pizzas in five minutes.
Pie Five has filed plans at City Hall to locate at 2500 Iowa St., which is the office building that is just north of the shopping center that includes Applebee’s, First Watch and several other shops.
Pie Five is a multistate pizza chain that seeks to bring the Subway sandwich style of food construction to the pizza business. Customers walk up to counter, pick from one of four different crusts, then they choose from up to seven different sauces for their pizza. There’s classic marinara, ranch olive oil, alfredo and others. The restaurant notes that you don’t have to think inside the box here. You can mix different sauces on the same pizza, if you choose. (That sounds like a plan. After all, nothing ever went wrong when I would mix and match flavors at the soda machine. Well, at least nothing that couldn’t be fixed by a carpet cleaner and a dry cleaning bill.)
“We won’t judge,” the restaurant’s website notes.
Then customers choose from four cheese blends, seven meat options, and 16 veggie toppings. Most are pretty standard, but a few go beyond the normal offerings. For example, cheese options include both ricotta and cheddar, meat options include meatballs, and veggies include jalapeños, caramelized onions, artichoke hearts and, for some reason, spinach.
My understanding is that, much like Subway, you can add as many toppings as you would like for the same price. The menu online, however, doesn’t list what prices the restaurant charges for pizzas.
Once you have your selections made, the dish goes in an oven that cooks the pizza in about five minutes.
The restaurant also has some nonpizza dishes. The restaurant serves a classic Italian or chicken Caesar salad, and both come in something called a “pizza crust bowl.” Plus, there are dessert items on the menu too.
I don’t have a timeline for when the restaurant is expected to open, but it may be quicker than most. The site plan filed at City Hall shows that the restaurant will use the existing building on site, which houses a Shelter Insurance office. The interior will be remodeled, and an outdoor seating area will be added, but otherwise it is not expected to be a major construction project.
In case you are wondering, the longtime Shelter Insurance agency that has been in the 2500 Iowa St. location will remain in business. Gary Petersen, owner of the agency, told me the business is moving into a vacant space next door to the First Watch restaurant at 2540 Iowa St.
That’s the Tower Plaza shopping center, which as we previously have reported is undergoing a major renovation. If you have driven by recently, you’ve noticed the facade of the shopping center has been stripped away. It will be replaced with a more modern looking design. The big news in the shopping center, though, is the southern end of the shopping center has been demolished to make way for a new Popeyes Chicken restaurant, as we previously have reported.
In case you have forgotten, another chicken restaurant also is under construction in the area. Across Iowa Street, some work has begun on a new Raising Cane’s chicken finger restaurant. It is locating where Emprise Bank previously had a branch on Iowa. That bank building has been demolished, and site work is underway for a new restaurant building.
Sometimes after a basketball game, I worry about finding where I parked my car. After last night’s triple overtime, heart-straining thriller, I worried about finding a retirement home. Lucky for me, plans have been filed for a new retirement living community in far west Lawrence.
If you remember, in July we reported that a project called the Village Cooperative had expressed interest in building a new senior living facility near Sixth Street and Queens Road. Well, the Minnesota-based development firm behind the project has now filed plans at City Hall to begin building the project.
The development group Real Estate Equities Development has filed plans to rezone about four acres of property at 5325 W. Sixth St. from a single-family zoning designation to a medium density apartment zoning. But this project will be a bit different from other apartment projects in town. The project only will be open to tenants 62 years and older, and residents won’t actually be owners of the units they live in, but rather will own a share in a cooperative.
Plans call for 52 living units, so each tenant will own 1/52nd of the entire housing complex. It will be a different type of housing option for Lawrence seniors. A representative with the company told me in July that an advantage of the cooperative ownership structure is that the cooperative is responsible for all the maintenance of the property, even for the items that need fixing inside your unit. For example, if the dishwasher breaks, it will be the responsibility of the cooperative to fix or replace it since technically the cooperative owns it. (I’m uncertain who fixes the TV when a thrown boot hits it after a referee misses a call. If you figure out who is responsible, send them to my house.)
The plans on file with City Hall provide a few more details about the project.
• All 52 units will be in a single, three-story building that also will include a community room, a club room and an outdoor patio with fireplace.
• The project will include a heated, underground parking garage that will have spaces for 58 vehicles.
• The project will be at the southwest corner of the intersection of Sixth Street and Queens Road. Well, sort of. Queens Road doesn’t technically extend south of Sixth Street. The property currently is just served by a driveway. The nearest city street to the south of the property is Branchwood Drive. According to the plans, Branchwood Drive will be extended north to connect with Sixth Street. That will mean the neighborhood just south of Sixth Street will have a new way to access Sixth Street. But it also means that I may throw more boots at my dashboard GPS. Lawrence, it appears will have another intersection where two streets directly across from each other have mismatched names. Think Iowa and Bob Billings/15th Street or Wakarusa and Legends Drive/Inverness Drive. I’m sure there are several more, but my GPS is not talking to me at the moment.
The plans don’t provide all the details on the size of the units, but previously a representative with the company had told me that units will range from about 870 feet to about 1,500 square feet. Prices for a share in the cooperative would likely be about $75,000 to $125,000. Residents then would pay a monthly fee of about $900 to $1,500 per month, with that fee covering property taxes, maintenance, some utilities, and other such items.
I’ve got a call into the project manager of the development to find out if that information is still accurate, and also what the latest timeline is for the project.
UPDATE: I got a call back from Shane Wright, project manager and partner in the development group for Village Cooperative. He said the group hopes to start construction in the summer and have the facility ready for owners to move into in summer 2017. The project is scheduled to go before the Lawrence-Douglas County Planning Commission in late January and before the City Commission in February.
Wright said interest in the project has been strong, with about 50 percent of the units pre-sold.
"We have a group of buyers made up mostly of Lawrence residents who have been itching for a product that suits their needs," Wright said. "We've even had some who had considered moving out of Lawrence to find the right product."
Wright said the development is offering units ranging from a one-bedroom to units as large as a two-bedroom, two-bath with a den. He said the cooperative style of ownership has been a selling point, but he said residents also like the northwest Lawrence location and that the project is relatively small at 52 units.
"It is going to be a smaller, intimate community neighborhood," Wright said. "They are excited about the relationships they'll form. Several of them already have started meeting on a weekly basis. It is becoming a social network."
The Lawrence argument that won’t end: To build more retail or to not build more retail; commissioners prepare to hear SLT shopping center proposal on Tuesday
Get your pointing finger limber, and your vocal chords warm. We’re set to engage in a great Lawrence tradition this week: arguing over whether Lawrence should build a shopping center.
City commissioners at their Tuesday evening meeting are scheduled to vote on some rezoning and planning issues for the KTen Crossing shopping center project, which would add about 250,000 square feet of new retail and commercial space at the southeast corner of the SLT and Iowa Street interchange.
The development group has said it has Academy Sports, Old Navy, HomeGoods, Fresh Market and either Designer Shoe Warehouse or Off Broadway Shoes ready to become anchor tenants for the project.
The line already has been drawn, and various groups firmly have planted themselves for or against the project. That is what we tend to do in Lawrence. Every few years Lawrence has battles about whether to build a new retail project. The Super Target center, the now defunct Borders bookstore downtown, the Home Depot project at 31st and Iowa, a proposed Lowe’s near Sixth Street and Follks Road and the Wal-Mart near Sixth and Wakarusa are a few that easily come to mind.
On the side pushing for approval of this project are, of course, the developers, a group based out of North Carolina that builds shopping centers in a host of communities across the country. The city also has received a number of letters from residents supporting the project, including several from people who are associated with the pro-business group called Cadre Lawrence.
On the side pushing to deny the project there are several groups including the Lawrence Association of Neighborhoods, and KU urban planning professor Kirk McClure, who has become the thought-leader for the Association of Neighborhoods on many issues related to economic growth in Lawrence.
Also worth noting is that both the city’s professional planning staff and the Lawrence-Douglas County Planning Commission are recommending approval of the project. That is different from in 2014 when the project was proposed to be about 500,000 square feet. At that size, the project didn’t win a positive recommendation, but the Planning Commission rethought the proposal when the development group decided to cut the size of the project in half.
City commissioners have held their cards close to their vest. Commissioner Matthew Herbert during the campaign made statements indicating he would support the project, especially since it has not asked for any tax breaks or other public incentives. Commissioner Leslie Soden made statements during the campaign indicating she had concerns with the proposal. The other three commissioners have been tough to read, but I’ve seen signs they are each open to the idea of approving the project. Whichever side can get two of the three to come to their side of the line will win the day.
The arguments in this matter basically will be twofold. Supporters will argue the community has too many Lawrence residents leaving town to shop due to a lack of retailers. They’ll also argue that we could get a few out-of-town shoppers — think Baldwin City, Eudora, rural Douglas County and Franklin County — if we offered some big box retailers that were more convenient than what is offered in Johnson County.
Opponents will argue that Lawrence already has too many retailers, that our incomes aren’t high enough to support more retail spending, that additional retail development will hurt downtown and other existing retailers, and that Lawrence can’t really compete with the retail offerings of Johnson County and Topeka.
Here’s my prediction: We’ll still be arguing about all those issues well after Tuesday night’s meeting is complete. I’ve covered the city’s business scene since 1992, and this basic argument has never gone away. And, when you think about it, why should it? What has the city ever done to try to end the argument? For the most part, the same groups of people come to a city commission lectern every few years and talk about how the other side is wrong and how they are right.
Nothing I’m about to write should be construed as arguing for a delay on this project — the KTen Crossing proposal already has dragged on for a long time — but, could the community benefit from an objective third party that could provide some guidance on retail issues?
Here’s a look at just two points that could perhaps benefit from a trusted third-party:
• McClure, as he often does, has written a letter to city commissioners detailing why the project ought to be rejected. Let me say this up front: I respect McClure. Unlike some people who step to the lectern of a public meeting, he does spend a lot of time researching and thinking about the issues. But his findings often are not universally accepted. There is one statement in his recent letter that I suspect will be a lighting rod for debate: “More stores do not create more spending. Rather, only more income in the community can drive growth in the economy. As a result, more stores do not create more spending, more sales taxes, more retail jobs or more value of retails buildings.” That’s written as a fact, but is it?
What if everybody’s income stays the same, but a new store opens in town that causes people to buy their goods in Lawrence rather than drive somewhere else to buy them? Wouldn’t that cause the amount of sales taxes collected in Lawrence to increase, even though incomes haven’t? I think some folks will argue that is what has happened recently with the opening of Dick’s Sporting Goods in Lawrence. Ask parents with school-age children whether they have bought any items at the Dick’s Sporting Goods store in Lawrence that they normally would have traveled out of town to purchase.
I called McClure to talk with him about the letter and that statement. He acknowledged that it is possible for a community’s sales tax collections to grow by reducing the number of shoppers who leave town. But he just doesn’t think that happens very often.
“It can happen, but the odds are pretty slim,” he said, adding that it usually take a super magnet store, like a Costco, to really move the needle.
McClure thinks proponents of new shopping centers overestimate the number of residents who are leaving Lawrence to shop and the number of residents who can be persuaded to keep their dollars at home.
“A very few shoppers from Lawrence will drive to KTen Crossing rather than Johnson County or Topeka,” McClure writes. “This will probably be a number too small to measure.”
Is that what an unbiased expert in the retail field believes? I don’t know. I don’t think the city does either.
• As developers often do, they commissioned a study from an expert they have hired. The retail market report by the developer’s expert talks about how the additional retail space will be well received in the community. The developers have used the findings of that study to make a specific statement: 40 percent of all Lawrence retail dollars spent on apparel are being spent outside of Lawrence.
That number is either accurate or inaccurate. I have no idea which. It would be nice to simply assume that it is true since it came from a professional in the field, but experts hired by developers are going to do nothing to ease the minds of skeptics. But could the city at some point hire an unbiased party to look at that number and others? Hire somebody to paint a picture of Lawrence’s retail scene, and more importantly help us understand what is reasonable? If Lawrence is losing 40 percent of its apparel dollars, how much do other communities lose? What is reasonable for Lawrence to expect, given that it is so close to Topeka and Kansas City?
There are people out there who could provide reasonable answers to those questions and others. Somebody, for example, needs to figure out what is a reasonable expectation for downtown Lawrence’s retail future. Recently, the number of retail outlets in downtown has fallen. Should that be alarming, or will the amount of new residential construction underway in downtown change that trend?
And what about the area near Rock Chalk Park? It is zoned for more than 400,000 square feet of commercial space, but none has been built yet despite it being on the market for years. Why not? There may well be a sentiment on the City Commission to deny the KTen Crossing because it will further delay the development of the Rock Chalk Park area. City commissioners are right to consider ways to create retail districts throughout the community, but if the city denies KTen Crossing in order to spur development at Rock Chalk Park, are they doing anything more than keeping their fingers crossed?
There won’t be any unbiased third party that comes to the rescue prior to Tuesday’s meeting. Commissioners will have to decide this issue the old-fashioned way: wade through argument after argument.
I’m not sure there ever will be a third party that can help us out with our retail argument. McClure and I agreed on a key point when we chatted recently: Any attempt to hire a third-party consultant to help City Hall understand the retail market would spark a massive argument. One side would argue Consulting Firm A is a shill for the development industry. The other side would argue Consulting Firm B is a pawn of the no-growth crowd.
Meanwhile, one point that isn’t argued: The city budget relies a lot on sales tax dollars. At least this argument isn’t a petty one.
It was a battle between former Lawrence mayor Jeremy Farmer and President Barack Obama.
Farmer got the victory, but he may not spend much time celebrating it.
The downfall of Farmer, and the shakeup that it produced at Lawrence City Hall, has been chosen as the top local story of 2015 in a vote of Journal-World editors and reporters. Farmer’s stiffest competition in the voting was Obama, who drew thousands of onlookers to the Kansas University campus in January for a presidential address.
As we flip the calendar and put away those pointy party hats for another year, let’s take a look at some of the top stories of 2015, and make some guesses about what stories we may be talking about a year from now. (Yes, you can keep your hat on, if you want.)
1. Farmer’s resignation
On Aug. 10, the Journal-World reported that Jeremy Farmer had unexpectedly resigned his position as executive director of Just Food, the largest food bank in the county. Upon being questioned by the Journal-World, Farmer and food bank leaders acknowledged that about $50,000 in federal payroll taxes had gone unpaid during Farmer’s tenure at the nonprofit. Two days later, Farmer would resign his seat on the Lawrence City Commission, and his spot as mayor. A subsequent investigation and audit by Just Food alleges that Farmer overpaid himself by more than $52,000. Just Food officials have turned their findings over to law enforcement officials, and indications are that federal officials are reviewing the case for possible criminal charges. In addition to his troubles at Just Food, Farmer also repaid the city about $1,100 for travel expenses that city officials determined were inappropriate. Farmer’s resignation led to political newcomer Lisa Larsen being selected by commissioners to fill Farmer’s unexpired term. Larsen’s appointment — coupled with the results of the April City Commission elections — helped create the least experienced Lawrence City Commission in recent memory. Spoiler alert: That issue will show up again on this list.
2. Obama’s visit
More than 7,000 people crowded into KU’s Anschutz Sports Pavilion to hear Obama speak on Jan. 22. Thousands more gathered outside to wave signs of support, and a few more to protest or to promote their particular causes. (I’m sure the president was watching closely and taking notes while driving by in the limo.) One group that likely won’t need any notes to remember the day are the folks at the preschool at the Plymouth Congregational Church in downtown Lawrence. Obama stopped by to surprise some toddlers at the school, with one 4-year old telling the president: “I saw you on my TV.”
3. Lengthy Legislature
Most other schools in Kansas didn’t get a presidential visit, but instead got a different piece of news from Gov. Sam Brownback and the Kansas Legislature. Lawmakers implemented major changes to the way schools are financed. That new financing system wasn’t kind to the Lawrence district. The Lawrence school district added 249 students for the 2015-2016 school year, but the new state formula did not provide any additional funding for the school district. Legislators didn’t limit their work to school finance. Lawmakers also passed a sales tax increase and other provisions to try to balance the state’s budget. Kansas lawmakers were in session for 113 days, the longest legislative session in the state’s history.
4. Murder trial
Lawrence residents in March watched the details of a murder mystery unfold. Jurors found 20-year old Sarah Gonzales McLinn guilty of first-degree murder in the January 2014 killing of Harold “Hal” Sasko, who at the time owned the Lawrence CiCi’s Pizza restaurant. Jurors heard McLinn’s videotaped post-arrest interview in which she detailed drugging Sasko with sleeping pills and then killing him with a knife. McLinn’s defense attorney told jurors about a multiple personality disorder McLinn suffers from, and how she had been the victim of sexual abuse at a young age. “We all know she is broken,” Carl Cornwell, McLinn’s attorney told jurors. Ultimately, jurors handed McLinn a “Hard 50” sentence, meaning she won’t be eligible for parole until she has served at least 50 years in prison.
5. Same-sex marriage
For many couples, Lawrence became a place of celebration in June when the U.S. Supreme Court ruled that gay and lesbian Americans have the same right to marry as any other couples. Back in 2005, when Kansas approved a constitutional amendment prohibiting same-sex marriage, Douglas County was the only county in the state where a majority of voters rejected the amendment. Douglas County residents were involved in lawsuits challenging the validity of the law, and Lawrence politicians were among those promising to ensure conservatives in power in Topeka fairly enforced the new law allowing same-sex marriages. “We’ll make sure it is legal in Kansas too, whether the governor likes it or not,” Rep. Boog Highberger, D-Lawrence, said.
6. Rock Chalk Park
The beginning of 2015 left city commissioners facing multiple questions about how much money they owed a private development group led by Lawrence businessman Thomas Fritzel for infrastructure work at Rock Chalk Park. City commissioners hired an auditor to help untangle the finances, but that audit then came under question after the auditor conceded portions of the report were incorrect and had to be restated. Ultimately, commissioners said they were confident they were paying a fair price for the infrastructure work, which was exempted from going through the city’s normal bidding process. But many voters weren’t so sure. The payment was made in the middle of City Commission election season, and many voters expressed their displeasure with City Hall at the polls.
7. School inspections
In August, an 8-year old child wandered onto the construction site of New York Elementary School, and was injured when a 350-pound gate fell on him. That sparked questions about why the site didn’t have adequate construction fencing. The lists of questions about the project, however, grew as the Journal-World investigated the matter. A review of documents found that an agreement between the school district and Douglas County created a situation where the chief building inspector for $92.5 million worth of bond projects had no authority to actually order that building codes be followed on the school district projects. Ultimately, the Lawrence school board agreed to have the projects inspected by standard city building inspectors who have full authority to order codes to be followed. The board also terminated the contract of the construction firm doing the work at New York Elementary.
8. City elections
Voters made it clear they wanted fresh faces in City Hall. Three incumbents on the five-member City Commission had terms expiring. One incumbent, Mike Dever, chose not to seek re-election. The remaining two, Terry Riordan and Bob Schumm, lost their bids for re-election. Voters elected three first-time office holders: Leslie Soden, Stuart Boley and Matthew Herbert. With Farmer’s resignation, the commission got another new face and first-time commissioner in Lisa Larsen. To top it off, longtime City Manager David Corliss in April announced that he was leaving to take a similar position in Castle Rock, Colo. Interim City Manager Diane Stoddard declined to apply for that position, which means at least one more new face is coming to Lawrence City Hall.
9. Oread finances
In February, the Journal-World, acting off an anonymous tip, asked City Hall leaders about why state records indicated a wholesale construction company was operating inside The Oread hotel. In December, City Hall released a report from a city-hired auditing firm that alleges the wholesale construction company — owned by Lawrence businessman Thomas Fritzel — was operating in a manner designed to inflate the amount of sales taxes collected in The Oread’s special taxing district. That special taxing district allows a development group led by Fritzel to keep a large amount of the sales taxes generated at The Oread. This story is at No. 9 on this year’s list, but depending on what happens in the next few weeks, it may land higher on the 2016 ranking.
10. Gold medal
We’re in Lawrence, so the year would feel incomplete without having a KU basketball story on the list. This year it is a golden one. A team comprising mainly KU coaches and players won the gold medal in the World University Games in South Korea in July. The KU men, though, had some competition for the attention of fans this year. KU’s women’s volleyball team made its first appearance in the Final Four, captivating thousands of Jayhawks along the way. You can probably debate which one of those seasons is most deserving of a spot on this list. But that’s OK. Debate away. This list is designed to be the beginning of a conversation rather than the end of one.
I’m guessing we’ll have plenty to talk about in 2016. We’ll have a new city manager, a new superintendent of schools, a new president and CEO of Lawrence Memorial Hospital, and a new provost at KU. It has been a long time since we’ve had that much turnover in key leadership positions in the community.
Guns also may be a big topic of conversation in the community, particularly guns on the KU campus, city recreation centers and other such places. An exemption that allows universities, cities and other such public bodies to prohibit people from carrying a concealed weapon into public buildings expires on July 1, 2017. Public agencies will still be allowed to prohibit concealed carry, if they equip their buildings with metal detectors, security guards and other such measures. Those measures will be expensive, so 2016 will be the year that City Hall, KU and others will have to figure out whether they can afford it. Get ready for debates about whether we should allow guns in places like Allen Fieldhouse, recreation centers, libraries and a whole host of other places.
While we are at it, we might as well have a conversation about jail. This year is expected to be a big one for Douglas County and its efforts to expand its jail. It likely will be a project that costs tens of millions of dollars, so figuring out how to pay for it will be a big deal to taxpayers. Beyond that, though, expect a debate about how the project should be designed. The county has said it doesn’t want to just build a typical jail expansion. It also wants to address the concern that we’re incarcerating many people with mental health issues that would be better served receiving treatment. How much of a jail we build versus how much of a mental health care facility we build, will be a key conversation in 2016.
And, in case you haven’t noticed, there’s some excitement about the KU basketball team this year. A gold medal is nice, but a big trophy following the final game of the season will get this town talking like nothing else.
But, as is often the case, it is usually the unexpected that gets us talking the most. The list above included several items that none of us saw coming at the beginning of the year. So, let a new round of conversations begin.
I’ll start with this: I really do think it is time for you take off the pointy party hat now.
Here’s a look at the 10 stories on LJWorld.com that received the most views in 2015:
- KU professor who uses 'n-word' in class discussion is placed on leave: 150,955 views (Nov. 20)
- Town Talk: A prominent goodbye from defunct Payless Furniture that labels Lawrence 'Obamaville' and much more: 114,092 views (May 11)
- Pet World fire kills many small animals; python, some other survive: 74,849 views (May 25)
- Two armed suspects at large after Sunday shooting; Three victims conditions improved: 53,994 views (Feb. 8)
- Police stop two groups of men carrying unconscious women to fraternity homes; call ambulances for alcohol poisoning: 50,568 (Sept. 14)
- KU’s McCollum Hall comes down Wednesday in 18 seconds with 750 pounds of explosives: 39,065 views (Nov. 22)
- Town Talk: Payless Furniture owner who said 'Goodbye Obamaville' back selling furniture in Lawrence: 34,884 views (Aug. 6)
- 19-year old Lawrence man killed in K-10 accident: 33,388 views (Aug. 11)
- Video of demolition crews bringing down KU’s McCollum Hall: 32,291 views (Nov. 25)
- Inside McCarthy Hall, the KU basketball team’s 'insane' new home: 31,236 views (Oct. 17)
When I first reported that plans for a robotic parking garage in the massive Here @ Kansas apartment project near the KU campus had fallen apart, I thought for sure the solution would involve hover boards and reruns of The Jetsons. But new plans filed at City Hall are indicating a more terrestrial solution: Tear down an existing apartment building and replace it with a new, traditional parking garage in the Oread neighborhood.
As we previously reported, the massive Here @ Kansas apartment project that is under construction across from KU’s Memorial Stadium has run into some parking problems. The vendor that was supposed to supply the project with a high-tech, automated parking garage system has filed for bankruptcy, and left Here officials scrambling to figure out how it is going to accommodate the hundreds of tenants that will be part of the multistory apartment/retail building.
The Chicago-based development group that is building the Here @ Kansas project has filed plans at City Hall seeking rezoning for a small apartment building at 1137 Indiana St., which is just to the south of the massive, 500,000-square-foot, multistory Here building. The development group is proposing to raze the apartment building and construct a new 96-space parking garage in its place.
Here officials are promoting the new garage as a solution that actually will provide more parking than was originally planned for the development, which will feature 237 apartments with 624 bedrooms, plus commercial space for restaurants or retailers that want to locate next to the KU campus. With the addition of the 96-space garage, Here officials believe the total project will have 712 parking spaces. That’s up from the 685 spaces that were proposed as part of the original development.
What’s going on here, it appears, is that the space in the building for the once-planned robotic parking garage will continue to be used for parking, but it won’t be able to accommodate as many spaces as once planned. The proposed parking garage at 1137 Indiana St. will make up for those lost spaces and then some.
At the moment, I’m unclear whether the Here project will include an automated parking garage of any kind, or whether that space is simply being converted into a traditional parking garage. At one point, the development group said it was looking for a different vendor for an automated garage system. Whether an automated garage will be part of the project may be an important point to some. The idea of using new technology to tackle the parking challenges in The Oread neighborhood was one of the selling points the project used to garner an 85 percent, 10-year property tax rebate for the project. (UPDATE: I got in touch this morning with project leader Jim Heffernan, and he confirmed that the project no longer will include the automated parking garage, but instead will feature a more traditional parking garage.)
If the project doesn’t have an automated parking garage, I suppose the City Commission could use that omission to modify the controversial tax rebate package, which was approved by the previous City Commission. But such a move likely would send shivers through the development community, given that the project is still meeting its original parking obligations and then some.
Instead, the debate at City Hall may be a more traditional one: Will this parking garage fit into the Oread neighborhood? I don’t have great renderings to share of the proposed garage currently, but you can see a little bit of the shape and size from this one below. The garage is not proposed to be a tall one, but rather is planned to have one level below ground and one level above ground.
The Oread is a neighborhood that is familiar with parking garages. KU already operates a parking garage in the neighborhood near 11th and Indiana streets, in addition to having some surface parking lots in the neighborhood. So, it will be interesting to see how the neighborhood responds to this proposal.
"We think it will be a very low profile building," Heffernan told me on Thursday. "We'll also be trying to use identical materials that were approved by the city for our other building."
City commissioners will have to give their approval to the plans in order for them to proceed. The property at 1137 Indiana — which currently is owned by a group led by Lawrence resident Ed Carter — must be rezoned to accommodate the parking garage. The property currently is zoned for RM 32 apartment zoning. The group is seeking the property to be rezoned to a mixed-used zoning designation.
Look for the project to get hearings at City Hall — first at the Planning Commission and then at the City Commission — in the next couple of months. Heffernan said he hopes to have city approvals by the end of March, which would keep the project on track to open by the beginning of the next KU school year.
"The project is being very well received," Heffernan said of the early response from renters.
• One other quick item of note with this project: The latest plans filed by the Chicago development group say that when the Here project is completed, it will be the “largest privately owned enclosed structure in the city of Lawrence.” I’ve heard that claim or something similar to it before, but it is not accurate. The Here project is slated to be about 454,000 square feet, according to the development group. I’ve always thought that the Kmart Distribution center along the Kansas Turnpike was quite a bit larger than that. I checked with the Douglas County Appraiser’s office this morning, and they confirmed that’s the case. The Kmart Distribution Center has about 1.05 million square feet, according to the county’s records.
(UPDATE: I chatted with Heffernan this morning, and he said the statement in the plans should have read that the building will be the largest privately-owned residential structure in the city. That may be accurate. I haven't checked that out.)
The issue isn’t really important to the matter at hand, except this project at times has attempted to “sell the sizzle” to city commissioners. That’s fine, but that means it is important that commissioners understand the true situation.
The development group in its filings also has stated that when completed, the project will “represent the single largest taxpaying parcel in the city.” That claim will take a little more time to fact-check, but it seems like one that should be examined.
Unique furniture, home decor store set to open in downtown Lawrence; news of escape room businesses, cigar lounge
Sarah Kellogg has a business plan for her soon-to-open retail store in downtown Lawrence: “We take something terribly dated and that nobody wants, and make it really awesome.” My wife is loading up my closet currently, but actually it is not that type of store. Kellogg is opening a new brand of furniture store in downtown.
Kellogg and her mother, Susan Clark, have signed a deal to open Vintage Chic at 823 Massachusetts St., which is the space that Foxtrot shoe shop soon will be vacating. Vintage Chic has been operating in a corner of the Fine Design interior design shop at Bob Billings Parkway and Kasold Drive. The new space will allow Vintage Chic to more than double in size, and the store’s owners plan to fill the space with furniture, a workshop and booth space for other home decor-oriented sellers.
“It is going to be quite a bit different than booths at an antique mall or something like that, though,” Kellogg said. “We’re not going to have people who just buy a desk at a garage sale and then try to simply sell it again.”
Instead, Vintage Chic will focus on selling products that have been remade in some way. That could mean old furniture that is given a more modern finish, or jazzed up with stenciling, or has its design modified in some way.
Kellogg said the shop will carry a variety of pieces, but buffets, china cabinets and storage pieces of any kind are very popular. The store also will be a retailer of the CeCe Caldwells paint brand, which is an environmentally friendly, chalk and clay-based brand of paint that has become popular in the DIY community. Kellogg said Vintage Chic will host classes in its workshop to teach different painting and refinishing techniques that people can use to liven up their furniture pieces.
In addition, the shop will offer both in-store or in-home wood and furniture refinishing services.
“A big item for us is refinishing people’s cabinets,” Kellogg said. “We don’t just do painting. We also do staining and all types of woodwork refinishing.”
As for the vendor part of the business, Kellogg said she expects the shop to accommodate about 15 booths. She said she’s had lots of area residents who sell on the online site Etsy wanting space in the new store. Vendors could range from other furniture dealers to artists who make unique and interesting home decor pieces to people who produce handmade soaps and other similar products.
Kellogg said Vintage Chic takes possession of the downtown building on Feb. 1, and would like to have the shop open sometime in March.
In case you have forgotten, we reported last month that Foxtrot is closing by the end of January.
In other news and notes from downtown:
• Just a couple of quick updates on downtown spaces that I will try to bring you more information on in the next few weeks. We reported earlier this month that the comic book and gaming store Astrokitty had moved from its longtime location at 15 E Seventh St. Well, the owner of Astrokitty tells me he’s been informed a new tenant for the building has been found. It will be a massage therapy business, which is expected to complement the hair and nail salon that is in the space above the former Astrokitty space. No word yet on which massage therapy business will take the space, but I’ll keep my eyes open.
We also previously have reported on the new trend of escape room businesses coming to Lawrence. Those are businesses where you can pay to get locked into a room and then you have an hour to try to solve several riddles and other tasks to get out. There are two coming to town: Breakout Lawrence and Locked In. We briefly had reported speculation that one of the two businesses was going to locate in the former Mass Street Sweet Shoppe at 727 Massachusetts St.
Well, we now know that it is the Breakout business. The company has put its sign in the window, and construction work is well underway at the location. The other escape room business, Locked In, is up and operational, according to its website and advertisements I’ve seen. It is located at 1414 W. Sixth St., which is in the small strip retail center near Sixth and Florida streets.
I’m also getting word that a new cigar lounge may be coming to downtown Lawrence. Issachar Cigar Shop has recently joined the Lawrence chamber of commerce under the category of a “premium retail cigar store and lounge.” It lists its location as 726 Massachusetts St., which is the former location of Creation Station. I don’t currently know anymore about the new business, but I’ll let you know when I do.
• One housekeeping note: Perhaps I’ll be painting furniture or maybe I will just lock myself in my closet in order to protect my “vintage” wardrobe. Whatever the case, Town Talk will be a bit sporadic between now and the new year. I’ll return to my regular daily schedule after Jan. 1.
I hope all of you have a very happy and safe holiday season.
Developer still working on parking solution for large apartment project near KU; man hands out $50 bills at Wal-Mart
Anybody who has ever picked up a hammer or saw has had it happen: You start your home improvement project and then realize you forgot a part. I usually fix such matters with duct tape, and if that doesn’t work, with an expensive jewelry purchase. Most of the time, though, the missing part is not a multimillion dollar automated parking system. But when it is, figuring out a solution can be a real head-scratcher, as one Lawrence apartment developer can attest.
We reported in October that the Here @ Kansas apartment project near Memorial Stadium ran into a major problem with its proposed, high-tech, robotic parking garage system. The problem is the company that makes the system went bankrupt and never delivered the equipment. That left a major question about how the multistory apartment complex — it will have 237 apartments with 624 bedrooms — is going to provide parking in an area that already is congested with KU traffic.
Well, the answer to that is still unclear, but the developer for the project said he expects to propose a solution to Lawrence City Hall in the next couple of weeks.
“We’re working very diligently on a comprehensive solution that actually will provide more spaces than before,” said James Heffernan, who is a leader of the Chicago-based development group that is building the $75 million apartment/mixed use project at 11th and Indiana streets.
When I chatted with Heffernan in October, the main plan was to find a new vendor for the automated parking system, which uses a series of elevators, tracks and other devices that allow motorists to drop off their vehicles and have them parked and retrieved completely without the assistance of a human. Heffernan wouldn’t go into any details about whether that is still the plan. He said the issue was a bit like a Rubik's Cube, and he didn’t want to comment on specifics until all the details were figured out.
“But we understand that is an important issue for the community, and we plan to rise to the occasion and provide a solution for it,” Heffernan said.
What will be interesting to watch is whether the solution will be confined to parking on site, or whether the development group will propose some off-site solutions. Heffernan didn’t provide such details, but when I chatted briefly with interim City Manager Diane Stoddard, she indicated the company was considering both on-site and off-site options.
“They appear to be looking at all those different options,” Stoddard said. “They have indicated to us that they will submit a plan by the end of this year or early next year.”
The Here group ran into the same problem for a similar project it was constructing in Champaign, Ill. That project, though, was much further along when the parking system company went bankrupt. Here officials have been forced to rent space in a city-owned parking lot a few blocks away, according to news reports in Champaign. Simply replacing the automated parking system with a traditional parking garage is difficult because the space for the automated system is significantly smaller than for a traditional garage because the automated system doesn’t need much space in the way of driving lanes or ramps.
Stoddard emphasized that any new parking plan for the Lawrence project will have to win the approval of the City Commission.
That could get interesting too. The project was a political hot potato when it was approved last year. The previous city commission approved a 10-year, 85 percent property tax rebate for the project, but did so on a 3-2 vote. There was significant opposition from neighbors who said even with the automated parking garage, they were concerned there would be significant overflow parking into the neighborhood.
Now, without the parking system, I suspect that concern is heightened. The interesting part is that four of the five members on the City Commission are new since that vote was taken. The one holdover — Mayor Mike Amyx — didn’t vote for the incentive package either.
Commissioner Leslie Soden back in October said she “absolutely” could see the commission debating whether to reduce the size of the incentive package to Here, if the project can’t deliver on its original parking plan.
It seems certain at this point that the new parking plan for the project will be different from what was proposed. Whether that means it is likely city commissioners will want to adjust the incentive, though, isn’t clear.
As Heffernan noted, he’s optimistic about finding a solution that will provide for more parking than what was originally proposed. The details will be important but, who knows, there might be a really creative solution out there.
After all, who would have ever thought that a diamond tennis bracelet could fix a stairway that ended four feet too short?
In other news and notes from around town:
• This is the time of year where unexpected things can happen, and apparently that was the case for some kids at a Lawrence Wal-Mart on Saturday.
I received a voicemail from Journal-World reader Denise Sellers that explained she had taken her grandson Christmas shopping at Wal-Mart on Saturday. The grandson always insists on putting a dollar into the Salvation Army donation bucket. When he did this time, there was a man standing next to the bucket, who gave the young boy a $50 bill as a thank-you for being generous.
Sellers said that it appeared he was giving out several $50 bills that day.
“He had kind of a huge stack of them,” Sellers told me in the voicemail.
Seller said she saw him give money to a couple of young children. She indicated he would wait until a child had put money in the bucket, then surprise the child with the $50 bill.
Sellers said she tried to get his name when she and her grandson thanked him, but he said he wasn’t interested in giving it.
I’m a little short on details beyond that because I haven’t been able to get in touch with Sellers this morning, so I don’t know if it was the Wal-Mart on south Iowa or the one on Sixth Street.
I checked in with a leader of the local Salvation Army. She hadn’t heard about it, but said it is always heartwarming to hear stories of generosity.
“I think that is awesome,” said Lt. Marisa McCluer. “A lot of parents want to instill the virtue of giving back. We love when kids volunteer to ring the kettle too. We know they are doing it out of the goodness of their heart.”
The Salvation Army could use some folks sticking $50 bills into the red kettles. McCluer said that with four days left on their bell ringing campaign the Lawrence kettles have collected about $55,000. The goal is $100,000.
As for the generous man with the $50 bills, I’m curious to know if that happened to anyone else. If so, share the details in the comment section below.
Italian dessert shop coming to Massachusetts Street; Lawrence gets ranking from LGBT civil rights group
Gelato. Sorbet. Cannoli. Am I showing off my bilingual skills here? Of course. Am I pointing to stains on my tie? Well, yes, but neither of those are really the point. I’m mainly working up to tell you that a new dessert shop — with a specialty in Italian dishes — is coming to downtown Lawrence.
Lawrence businessman Dan Blomgren has signed a deal to open Crema Dolce — Italian for Sweet Cream — in the spot that Bloom Bath & Body is vacating in the coming days. In case you have forgotten, that’s the space at 704 Massachusetts St., right above Rudy’s Pizza. We previously have reported that Bloom is closing its Lawrence store
Blomgren owns Cibo Sano Italian Grille at Sixth and Wakarusa. In the last three-months, he’s begun offering a homemade line of gelato at the store.
“The response has been so strong,” Blomgren said. “People have really loved the product, and I know there is so much activity downtown. I just told myself that I really needed to be downtown.”
Perhaps I should back up. I sometimes forget not everyone is as bilingual as I am. Gelato is basically Italian ice cream. Blomgren notes that it is actually made from milk rather than cream, which makes it “a little bit healthier.” The bigger difference, though, is that it has a lot less air whipped into it, making it a heavier, denser dessert than ice cream. (I knew air was what made ice cream unhealthy. That’s why I hardly ever take a breath while I’m eating it.)
As for sorbet, it also is a frozen dessert, but it is dairy free. Blomgren expects to have about 16 flavors of the dessert available. He’ll also offer the gelato in the forms of malts and shakes. All the desserts will be made in the store. Blomgren went to a culinary school in North Carolina earlier this year to get a crash course in gelato making.
Blomgren said he eventually wants the business to become a full dessert bar business. That doesn’t mean the business will be serving alcohol, but rather patrons would be able to belly up to a bar and order a variety of desserts. Blomgren said he’s been experimenting with tiramisu, creme brûlée, cannoli and other dishes.
“I’ll probably start out doing mostly Italian desserts, but I’ll go where the market takes me,” said Blomgren, who previously was in the liquor store business in Lawrence.
Blomgren said he plans to have the business open until 10 p.m. or so to take advantage of diners who are in downtown and want to cap the night off with something sweet. That seems to be a trend in downtown. I can think of five other dessert oriented businesses in downtown off the top of my head, and I very well may be forgetting someone: Sylas & Maddy’s ice cream; TCBY frozen yogurt and cookies; Hot Box Cookies; Cold Stone Creamery; and Billy Vanilly Cupcakes.
As for a timeline for Crema Dolce to open, Blomgren said he hopes to open sometime in March. He will get access to the space Jan. 1, and plans to begin renovations soon thereafter. That tells me that if you want to get any shopping done at Bloom, you had better do so in the next few days.
In other news and notes from around town:
• Lawrence has made another ranking, and this one — perhaps more than most — shows how Lawrence is different from its neighbors.
The Human Rights Campaign, the nation’s largest lesbian, gay, bisexual and transgender civil rights organization, has released its annual Municipal Equality Index. It found Lawrence scores better than the national average in terms of equality issues for the LGBT community. What’s more interesting is how much more highly it scores than other cities in the state.
Lawrence received a score of 69 out of 100 in the report, which examines 41 factors that fall into categories such as nondiscrimination laws, municipality’s employment policies, inclusiveness of city services, law enforcement and municipal leadership on matters of equality. Lawrence’s score of 69 was better than the national average of 56. It also was significantly better than the Kansas average of 25.
The next highest ranked city in Kansas was Manhattan, with a score of 26. Others ranked were Kansas City, Kan., 24; Topeka, 24; Wichita, 21, Olathe, 8, and Overland Park, 8. It is interesting to note that of the 408 cities ranked by the organization, only 5 percent of them received a score below 10. Two of them were in Johnson County.
But just a few miles to the east, Kansas City, Mo. received the highest possible score from the group. KCMO was one of 47 cities that received a perfect score of 100 on the ranking.
As for Lawrence, its report card shows that it scored well for its nondiscrimination laws it has on the books, but missed out on points in some categories by lacking a nondiscrimination ordinance related to city contractors, by not having a LGBT police liaison or task force; and the absence of an LGBT liaison in the mayor’s office.
Other cities of note and their scores:
— Boulder, Colo.: 76
— Ames, Iowa: 70
— Iowa City: 100
— Columbia, Mo. 74
— Independence, Mo.: 17
— Lincoln, Neb.: 54
— Omaha, Neb.: 71
– Norman, Okla.: 43
— Stillwater, Okla.: 12
— Austin, Texas: 100
— Lubbock, Texas: 0
— Waco, Texas: 25
A list of past Thomas Fritzel controversies and the $10 million question that comes with the latest allegations
It has become a routine at Lawrence City Hall. Every few months, the city finds itself embroiled in a controversy with Lawrence businessman Thomas Fritzel at the center of the storm. This most recent one — an alleged $500,000 worth of sales tax misdeeds at The Oread hotel site — is one of the more interesting ones yet. But, it could get a lot more interesting before it is over because this controversy has at least $10 million at stake for the city and Fritzel’s development group.
As our reporting over the last few days has explained, The Oread hotel site is in a special taxing district. What is special about it is that Fritzel’s development group gets a large percentage of all local sales taxes generated at the site rebated back to it. The city has been sending rebate checks to the development group since 2009, when the hotel opened. But what is important to note is that the city is scheduled to send rebate checks to Fritzel’s development group until about 2029, or until the development group receives a total of $11 million in rebates, plus the interest costs the development group has paid on loans used to build the private parking garage and other pieces of infrastructure. The project has received about $3 million in rebates thus far, and when you factor in the interest costs, there’s probably at least another $10 million it is eligible to receive in coming years.
As those numbers show, taxpayers are a major partner in this project. I predict this latest controversy will cause taxpayers to soon ask an important question: Should they continue to be partners?
If the allegations in the auditor’s report prove to be true, it seems likely that the city would have legal grounds to terminate the entire incentive package being provided to the Oread project. At that point, this becomes about more than just a $500,000 repayment. The development group would be at risk of losing $10 million it presumably is counting on to repay loans it has undertaken on the project.
If the allegations are proved to be true — and the city seems to be convinced the allegations are true because the city is seeking the money by the end of the month — the situation essentially would be this: The development group was trying to deceive the public into providing larger than required tax rebates. That’s the sort of thing that causes trust to erode in a partnership. And, partnerships without trust have made divorce attorneys a lot of money.
Whether the city will go so far as to cancel the entire incentive package of the Oread project is unclear. I asked both interim City Manager Diane Stoddard and Mayor Mike Amyx that question yesterday. Stoddard said all options are on the table, but the city wants to first focus on getting paid the approximately $500,000 it has demanded. Amyx said much the same.
It will be interesting to hear what the public has to say about this. I would think one factor the public will weigh is the long list of controversies that Fritzel has been involved in. Here’s a reminder of a few, in no particular order:
• Fake Grass. Fritzel in 2012 became embroiled in a controversy over whether he improperly installed artificial turf at one of his west Lawrence apartment complexes. The city staff said he did and told Fritzel while his crews were installing it that it was impermissible under city code. Fritzel disagreed and continued to install it anyway. Commissioners eventually agreed that the fake grass wasn’t allowed under city code, but the commission allowed Fritzel to keep the fake grass anyway.
• Varsity House. In 2012, a Fritzel group agreed to a $50,000 settlement to end a dispute over whether the old Varsity House was improperly dismantled and removed from its site in the Oread neighborhood. The city and historic preservationists thought Fritzel was going to move the old house to a different part of the lot to make room for a new apartment project. But what happened instead is that Fritzel’s crews completely dismantled the house and stored its parts offsite until it was reassembled onsite. Historic preservationists were angry because they said the dismantling ruined the integrity of the old home. Fritzel disagreed, but ultimately agreed to pay a $50,000 settlement in order to get the needed occupancy permit for his apartment project.
• The Cave. Fritzel is part of the ownership group of the student-oriented nightclub The Cave, which is located in the basement of The Oread. In February, the operators of The Cave pleaded guilty to four counts of violating the state law prohibiting establishments from giving away free liquor or advertising free liquor. In addition, Lawrence police department officials previously have expressed concerns about some of the large melees they have to respond to at The Cave or just outside of The Cave’s premises.
• Drywall contractor. Early this year, a Fritzel attorney — when questioned by the Journal-World — acknowledged that one of Fritzel’s firms had used a drywall contractor that is at the center of an alleged multimillion dollar scheme involving money laundering and undocumented workers. The contractor was used for portions of the Rock Chalk Park stadium construction. Fritzel has denied knowing anything about the alleged money laundering and undocumented worker scheme. When I last checked with the U.S. attorney’s office a few weeks ago, I was told the matter is still under investigation.
• Rock Chalk Park. A Fritzel-led group was the key private partner in the public-private partnership that built the city recreation center and KU sports facilities at Rock Chalk Park. Fritzel faced significant criticism from the public over his demand that he would only partner with the city, if the city agreed to waive its bidding practices for large portions of the project. An auditor eventually had to be hired to review questions surrounding payments the city was required to make to Fritzel’s group.
It would be unfair, however, if I didn’t note that Fritzel has been credited with several positive developments in the community too. The Eldridge Hotel, a jewel of the community, is in better shape than it was before his group purchased it. He has been part of successfully redeveloping portions of the 600 block of Massachusetts Street. He was a key partner in landing the Berry Plastics distribution center in rural Douglas County. He has been involved in philanthropy in the community.
Let me be clear: I don’t know whether the city should revoke the incentive package for The Oread project. Doing so very well could put The Oread in financial distress. The city could lose some transient guest tax revenues as a result. The development community may shudder, believing this is a sign the city will revoke other incentive packages in the future.
On the other hand, I have said several times that I believe the biggest issue facing the City Commission currently is low levels of trust with some community residents. (A quick note: The city staff deserves some credit for bringing this Oread tax issue to light. In February, I told a city staff member I had received a tip about a company called Oread Wholesale that was operating at The Oread. It seemed odd. The city staff, which I have found over the years to be a hard-working and professional group, took that information and got the ball rolling on this audit. State laws were stymying my efforts to get the necessary information to get to the bottom of this, so, absent this audit, I’m not sure the public would have found out about this.)
If the city believes that these allegations are true and that Fritzel was seeking to deceive the city, it is hard to see how the city can simply ask for its money back and move on. That would create a new round of trust concerns with the public.
As I look at this, I don’t see where the city has proposed any penalty for these alleged actions at Oread. The city is basically asking to be made whole. The payment of interest is not a penalty because the development group earned interest on the money while it had it. Paying $27,000 for the audit the city had to conduct hardly seems like a penalty.
Imagine if the IRS handled situations in this manner. How many people would not pay their taxes if they thought the end result of getting caught was simply they would have to pay what they owed?
Again, I don’t know what the City Commission should do. It has some tough decisions to make. This much seems clear: The City Commission will be sending a message by what it does or by what it does not do. That’s been the case every time the city has had to deal with a Fritzel controversy.
Now, the question seems to be whether the City Commission will send a message that causes this list of Fritzel controversies to stop growing.
UPDATE: The Douglas County District Attorney’s Office on Thursday said it had received a high volume of calls regarding the city’s investigation into the 12th and Oread Tax Increment Financing District Redevelopment Agreement. The DA’s office noted it is not an investigative agency. Criminal investigations are commenced by law enforcement agencies, and the results are forwarded to the DA’s office for review and consideration for prosecution. The DA’s office said it had been contacted by the City of Lawrence and informed of the general nature of this matter.
Lawrence tops $200 million in building projects for first time in city’s history; longtime construction company to close Lawrence operations
The number that has caught my eye this morning is $200 million, and thankfully it didn’t come from my friends at Visa. It is from the city’s latest building permit report. The city has topped the $200 million mark in construction projects for the first time in history. (The true total is actually a lot higher because the city's figures don't include the bulk of the school projects underway or the work happening on the KU campus. Plus, building permit totals don't capture other types of construction, like the more than $190 million worth of road work as part of the South Lawrence Trafficway project.)
The latest report shows building permits issued in October, and the fall season was a good one on the construction front. The city issued permits for $12 million worth of projects in the month. That brought the year-to-date total to $206.9 million.
We previously have reported that the city had set a new building total record. Back in August the city broke the previous record of $171.9 million that was set in 2013. So, now the city is just adding to the record.
Perhaps the most noteworthy number in the report is that single-family home construction experienced its best month of the year in October. Builders pulled permits for 28 single-family homes, topping the previous high mark of 21 set in June. When you add duplex construction to the mix, the city has issued 211 permits for single-family and duplex construction in the city thus far in 2015. That’s the highest total in at least the last six years, according to figures from the city. Not only is the number higher; it is a lot higher. At this time in 2014, the city had issued only 88 permits for single-family and duplex construction. The five-year average has been 112 units.
The numbers seem to be a sign that the construction industry is betting that the housing market in Lawrence is in for a pretty good run.
The city report also noted a couple of projects worth keeping an eye on. Permits have been issued for a new industrial building in front of the Comfort Inn and Suites near McDonald Drive and Princeton Boulevard. As we previously have reported, a group led by Lawrence businessman Thomas Fritzel is building a storage unit facility there. Based on the plans I’ve seen, it won’t be mini-storage units; rather, the plans show three climate-controlled buildings that will be constructed on the site. My understanding is Fritzel plans to relocate some of his construction firms that are using some downtown space into those buildings. I suspect some of the buildings also may be for lease to other firms that have storage or warehouse needs, but I don’t have any definitive word on that. That project pulled permits for about $775,000 worth of work, which made it the largest project of October.
The city’s report also notes a building permit has been issued for remodeling work at Sports Pavilion Lawrence, the city-owned recreation center at Rock Chalk Park. The work is part of Lawrence Memorial Hospital’s plan to renovate vacant space in the center into a sports therapy location for the hospital. The city issued permits for about $150,000 worth of remodeling work at the center.
In other news and notes from around town:
During this season of holiday buffets, I pretty much always carry the equivalent of a concrete block in my stomach. But if you want the real deal, there’s soon going to be one less option in Lawrence. A concrete block company that has had ties to Lawrence for more than 50 years is leaving the city at the end of the month.
Capitol Concrete Products has confirmed it is closing its North Lawrence facility at the end of the month and transferring workers to the company’s Topeka plant. Capitol Concrete sells concrete blocks, bricks, pavers and other types of materials to contractors and the general public. It has been in the Lawrence market since 1998, but its Lawrence lineage dates back much further. The company bought the Lawrence-based Morton’s Building Materials in 1998. Morton’s had been in operation in Lawrence — primarily on East 15th Street — since at least the 1940s.
Capitol Concrete had closed the production part of the Lawrence operation years ago and had just four employees at the Lawrence location, which served as a distribution and retail center. Jon Forsberg, manager at the Lawrence center, told me three of the four employees are transferring to other positions with Capitol Concrete, which has a production plant in Topeka.
Forsberg said the concrete block business did see a decline during the recession, but said business had picked back up. He directed questions about why the company is leaving the Lawrence market to Capitol’s parent company, which is The Monarch Cement Company in Humboldt. I put a call into an executive down there, but haven’t heard back yet.
UPDATE: I did hear back from Kent Webber, executive vice president of Monarch. He said the fact that the Lawrence office no longer produced any products but rather was only a sales office led to the decision. He said the company will keep its sales representative stationed in Lawrence, and the representative will continue to call on commercial accounts. The North Lawrence business was open to the public, but Webber said the big box home improvement retailers had cut down on the amount of retail business the location did.
Capitol Concrete’s North Lawrence facility is in the small industrial park that is just north of the Tee Pee Junction, which also is known as the intersection of U.S. Highway 24/40 and U.S. Highway 59. Forsberg said Capitol Concrete owns the facility and would be seeking a buyer for the several-acre site. Webber said the company has had conversations with a couple of potential buyers, but has not made any decision about what to do with the property. The company several years ago sold its East 15th Street facility. It is owned by the city of Lawrence.
More questions about Oread special taxing district; commissioner says city working to make sure ‘everyone pays their fair share of taxes’
I think we are getting closer to figuring out what the concerns are with the special taxing district at The Oread hotel. But I don’t think that means we are near the end of the questions about this project.
If you remember, we reported in November that the city had hired a Wichita accounting firm to complete a report on how the special taxing district — which has generated more than $2 million and counting for the development group that built the hotel — is operating. Then, last week we reported there were signs from City Hall that the auditing firm had found some concerning information, but no details have been publicly released.
If I’m reading the tea leaves correctly, city commissioners are going to again discuss the issue behind closed doors tonight. They have an executive session planned for their meeting this evening, and the general description of the session leads me to believe it is about The Oread issue. That session, I believe, should clear the way for the city to release the findings of the report in the coming days.
Since I last wrote about the topic last week, I have had a chance to talk with some more commissioners about the subject, and also to come up with some more questions.
Mayor Mike Amyx and I chatted Monday, and he stood by his decision to have a vote in October for an approximately $500,000 public incentive for The Eldridge Hotel expansion project. The Eldridge project and The Oread project have become linked because the two properties have a lot of cross ownership, and both are led by Lawrence businessman Thomas Fritzel. My theory is this: If the auditors find problems at The Oread taxing district that point back to Fritzel and his group, the public is going to be mad that the City Commission gave Fritzel and his group another round of public incentives just weeks before the results of this audit came out.
On Monday, Amyx said he felt allowing The Eldridge incentive request to proceed was the right thing to do.
“I didn’t give a lot of thought to that,” Amyx said of delaying The Eldridge vote. “They are completely different projects. I know there is a lot of cross ownership, but they are technically different owners.”
Not all commissioners are of that opinion. Commissioner Leslie Soden said she wishes the city would have waited until after the auditing firm had completed its work. Soden ended up voting against The Eldridge request.
“If delaying the vote was something I could have accomplished, I would have,” Soden said. “But it is the mayor’s prerogative of what to put on the agenda.”
Amyx noted that when The Eldridge vote came up in October there was a lot of discussion about how the City Commission needed to follow through on a promise that the previous commission had made to The Eldridge project. The previous commission had passed a resolution of intent to grant the approximately $500,000 sales tax exemption for the project. But because of the April elections, it fell to the new commission to actually approve the final paperwork on the incentive.
“We were receiving a lot of recommendations that we had to stand up to the commitments that were made,” Amyx said. “That decision was one of honoring a commitment made by the commission.”
The commission certainly did receive some comment from the public urging the city to approve the incentive on those grounds. But it is worth remembering an important fact: The public didn't know there was an audit underway.
I think that is one of the questions to be answered here: Why wasn’t the public made aware that an auditing firm had been hired to look into the issue?
Normally, when the city engages a contractor, the City Commission approves of it through an agenda item. That would cause us to see the agenda item, write about it and inform the public. But the city manager’s office has confirmed to me that the hiring of this audit firm was not the subject of an agenda item. The city manager has the authority to hire some firms to do work for the city, as long as the amount is below certain levels. The estimated cost of this audit is $15,000, which I think falls within the city manager’s purview to do without formal City Commission approval.
In talking with interim City Manager Diane Stoddard, she noted there are a lot of state-imposed confidentially requirements involved with examining sales tax reports of private businesses. But those confidentiality requirements don’t prevent the city from acknowledging that it has hired an auditor to review the district. The city did acknowledge that an auditor had been hired when the Journal-World asked the city about it in November. But the only reason we knew to ask was because we received an anonymous tip alerting us to the audit’s existence.
Perhaps the city handled this the way it did out of an abundance of caution. I can understand that the city wouldn’t want to embarrass a company by announcing it was conducting an audit without knowing whether the audit was actually going to find anything.
But, the issue of tax incentives has been a very important one to the public. It was a hot-button issue during the elections. I’m certain that there are members of the public who would have liked to have had that information when they gave public comment to commissioners on The Eldridge tax incentive request in October.
That brings me to my second question: How much information should the public be entitled to receive about businesses that are benefiting from a public tax incentive?
Here’s some background on this Oread issue: I called the city many months ago — before the audit was ordered — telling them that I had received a tip that a company called Oread Wholesale LC was using a business address of 1200 Oread Ave., which is the address for the hotel. I found that odd because Oread Wholesale appears to be a construction material wholesale company owned by Thomas Fritzel, and there doesn’t appear to be an active construction material wholesale company operating at 1200 Oread. But understanding special taxing districts, I knew it could be advantageous to list all the sales of Oread Wholesale as being made at 1200 Oread. That’s because Fritzel’s development group gets a large percentage of any sales taxes generated at 1200 Oread rebated back to it as part of the special taxing district. That could be problematic on a couple of fronts. Is that really the type of business the city intended to provide an incentive to? And, unless construction materials actually were changing hands at 1200 Oread, there probably would be some questions of whether the state’s sales tax laws are being followed. Normally, construction materials are delivered to a job site, which means sales tax should be charged at the location of the job site, not the location of the wholesale company.
So, I wanted to find out if there was anything to this tip I had received. I knew state law wasn’t going to let me see the actual sales tax reports filed by an individual business. That would give me access to private business information, such as how much the company is doing in sales. But I thought I might be able to see a list of all companies that are filing sales tax reports from that address. The city checked for me, and told me state law wouldn’t allow them to release that information either.
That creates an interesting situation. The public is providing an incentive worth millions of dollars to this project, but the public faces considerable difficulty in determining what businesses benefit from that public incentive. What harm would be created by the state releasing information about whether a business is filing a sales tax report from a specific location, particularly if the public has invested in that location through a public incentive?
The issue is more directly tied to state law than anything the city controls, but some city commissioners said they did think that businesses seeking incentives need to be ready to share more information with the public than they would otherwise.
“If you don’t want us in your business, don’t come asking for anything,” Commissioner Matthew Herbert said. “If you don’t ask for incentives, we will basically stay out of your hair. I think a company that asks for taxpayer subsidy needs to be prepared to be more transparent than an ordinary private company.”
Soden said she’s interested in exploring whether the city could create a requirement that any project receiving a public incentive is regularly required to file information listing what businesses are operating within the project. That way, the city would not find itself in a situation of thinking it was providing an incentive to benefit Business A, when in fact it was providing an incentive to benefit Business A, B and C.
“I’ve been frustrated by this issue for awhile,” Soden said.
If the city starts adding more requirements related to public incentives, that likely will create debate. There will be arguments that too many requirements will decrease the effectiveness of an incentive. If someone receives an incentive for a multitenant office building, for example, how much information are tenants of that building reasonably going to want to provide to City Hall?
Of course, the biggest question in all of this is: What did the auditing firm find? Amyx didn’t provide a specific timeline for the city to release the information, but said it will come out in a “timely fashion.” He said he's committed to making the findings public.
I don’t have any good insight into what the firm has found, other than sources have told me there are some significant findings. Whether those findings involve the development group, the city or something else, I don’t know. But Soden did make one comment that I found interesting.
“I want people to understand that the city has been working on this for awhile, and we are not trying to keep this hidden for any ugly reasons,” Soden said. “The city has always been on top of the issue, and has been working to make sure everybody pays their fair share of taxes.”