Rock Chalk Park audit, incentives for Peaslee Center, Eldridge Hotel tax break set to be decided by city commissioners

There’s nothing like a long City Commission meeting to take your mind off a season-ending Jayhawk loss, although both occasionally will cause you to stand up and yell, “I need some more !*&#!!$!! cheese dip.” Regardless, here’s a look at a long list of items city commissioners are set to deal with on Tuesday.

• Rock Chalk Park audit: If you remember from earlier this month, there were questions raised about the accuracy of portions of the audit conducted on the infrastructure costs at Rock Chalk Park. Well, the city-hired auditor — McDonald & Associates Inc. — has indeed revised its audit report, and acknowledged that some methods related to calculating concrete weren’t the best.

But, one finding of the revised report is probably different than what city commissioners hoped for: Version 2.0 of the audit says the city actually owes more money on the infrastructure project than what Version 1.0 had determined. The new report says the city still has an outstanding balance of $1,092,971 compared to $1,025,649 that was determined in the first report. In other words, the city — according to the auditor’s calculations –owes about $67,000 more to KU Endowment, which in turn will pay Bliss Sports II, which was the private contractor that received the no-bid contract to build roads, parking lots, sewer lines and other infrastructure at the site.

I’m still sorting through the new report, but it appears the second report has removed about $67,000 worth of payments that the first report said had already been made by the city. In Version 1.0 of the audit report, the auditors found that the city paid $10,550,630 for the city’s recreation center at Rock Chalk Park. But Version 2.0 credited the city with $10,500,000 in recreation center costs. The $10,500,000 cost is consistent with the bid the city received for the recreation center. But in Version 1.0 of the report, the auditors said there were city accounting records that showed $10,550,630 had actually been paid for the recreation center. The amount paid for the recreation center is important because the city has a $22.5 million cap on how much it must pay for total Rock Chalk Park expenses. Every dollar paid for the recreation center reduces by a dollar the amount the city must pay for the infrastructure.

The two versions of the audit report also disagree on how much the city should be credited for architecture fees for the recreation center. Version 1.0 of the report says $941,408, based off of city accounting records. Version 2.0 says $925,000.

Honestly, I’m still checking on why the amounts are different. I think it is because upon further review it was found that some of the amounts listed in Version 1.0 report were found to be payments that were outside the scope of the development agreement, and thus shouldn’t be used to reduce the city’s payment cap. I’ll keep checking on that. I don’t believe any of it, though, is related to the original question that sparked Version 2.0 of this report — the analysis of concrete batch tickets. On that point, the auditors said they once thought looking at concrete batch delivery tickets would be a feasible way of verifying that the amount of concrete used on the job was roughly matching the amount of concrete city inspectors were noting in their reports. But Version 2.0 of the report has since determined that “reliance on the delivery tickets quantities was very likely unreliable, but this in no way impacted the other testing and examinations that we performed.”

In other words, the concrete delivery ticket information included in Version 1.0 of the audit report shouldn’t be relied on, but auditors are still confident in their main finding that the city is being appropriately charged for the project.

Commissioners are scheduled to review the new findings at their Tuesday meeting and also may agree to make the final payment on the infrastructure project.

• Peaslee Technical Training Center. Here is an economic development project that has gone much smoother at City Hall. The Peaslee Center hopes to open later this year and begin teaching skilled trades such as construction, manufacturing technology and automotive repair. The joint venture between the Economic Development Corporation of Lawrence and Douglas County, and the city and the county has been well received because training center is expected to help the community retain and attract employers who need skilled labor.

The center will enter a little bit of different territory on Tuesday. It will ask for some financial incentives to help renovate the building that will house the school. That building is the former Honeywell building just north of 31st and Haskell. The project is seeking the following:

• About a $64,000 rebate on property taxes paid for the building in 2014. The $64,000 represents the amount of taxes owed on the portion of the building that will be used by the technical training center. There’s also a manufacturer that uses a portion of the building — Hiper Technology — and it will continue to pay property taxes for its portion of the building.

• A $500,000 grant from the city to help renovation costs of the building. The estimated renovation budget is $1.2 million. Leaders of the technical center also are asking the Douglas County commission to provide a $500,000 grant. The Economic Development Corporation is prepared to provide a $200,000 grant. The EDC previously has invested about $1 million into purchasing the building.

• A loan of up to $150,000 to complete renovations of a portion of the building that will be used to house the Lawrence Workforce Center. Leaders of the technical center submitted a proposal for the Workforce Center to relocate from south Iowa Street to the site of the technical center because they believe students of the school will benefit by being close to the workforce center. The County Commission also will be asked to support a loan of up to $150,000 for the renovation costs. Leaders with the technical center are proposing a 10-year loan that will include an interest rate that is 1 percent higher than the “idled funds rate,” which basically just means the interest rate the city could earn on a savings account.

• Request for industrial revenue bonds, which would allow the project to receive an exemption from paying sales tax on any of the construction materials bought for the renovations.

• Eldridge Hotel tax incentive. City commissioners will consider finalizing a tax incentive for an expansion of The Eldridge Hotel. Last month, city commissioners gave preliminary approval for an incentive that will rebate 95 percent of the new property taxes on the expansion for 15 years through the Neighborhood Revitalization Act.

The County Commission, however, approved a lesser incentive. It approved an 85 percent property tax rebate for 15 years. After the meeting, a representative with the hotel group said the lesser incentive likely would work for the project. The school board approved a 95 percent, 15-year tax rebate for the project.

Commissioners on Tuesday need to formalize their action. It is not required that the city, county and school board all offer the same incentive amount. Commissioners, though, will have to decide whether they want to offer a larger incentive than the county has offered.

• While it is not on the agenda, one of the bigger items to keep an eye on this week at City Hall is any news out of Castle Rock, Colo. As we reported Friday, City Manager David Corliss is a finalist for the town manager job in that community. No word yet on when an announcement will be made, but all the candidates were publicly introduced to the Castle Rock community. Usually that is done near the end of a hiring process, but we’ll see.

Lawrence city commissioners meet at 5:45 p.m. Tuesday at City Hall.