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Posts tagged with Hallmark

Crunching the numbers on police HQ plan; still no update on firefighters negotiations; city wins grant for solar project

Last night’s City Commission meeting ended up sounding like a diet soda commercial, at times. The big phrase of the night was “net zero.” You know, like zero calories but all the same great taste. But city commissioners weren’t selling soda. They were selling a $2.25 million land purchase for a new police headquarters building.

As we reported, commissioners approved a letter of intent to buy about 47 acres of vacant ground from Hallmark Cards along McDonald Drive. There was no drama in whether commissioners were going to approve that deal. Staff members had negotiated about $1 million off the asking price for the ground, and commissioners like its relatively central location. But even with the reduced price, the Hallmark site is still the most expensive of any considered by the city. Two of the sites were on property already owned by the city — one across the street from the county jail in VenturePark and another near Sixth and Wakarusa — so there have been questions about why the city hasn’t pursued one of those lower-cost options.

Commissioners have said the central location of the Hallmark site and the fact it has been listed as the preferred site by Police Chief Tarik Khatib were big factors. But commissioners didn’t stop there. They also said they were confident the land could come at a “net zero” cost to taxpayers. That’s because the city only needs about 15 acres of the 47 acre site, and the city thinks it can sell the remaining acreage to help offset the costs. By the end of the night, though, it was clear that statement needed more review.

So, here’s a look at some of the details:

— The idea of net zero costs to taxpayers is a projection, and it is one that still will be uncertain when voters go to the polls in November. Commissioners won’t have all the necessary land deals in place to completely offset the $2.25 million purchase price by November. Voters will have to put some faith in the future real estate market.

— Part of the proposed sell-off of land has included the idea of a privately operated family fun center that includes electric go-karts, mini-golf, batting cages and other outdoor activities. When the project was proposed for a West Lawrence site, neighbors came out in strong opposition. On Tuesday, the president of the Pinckney Neighborhood Association said residents would want to hear a lot more about this fun center idea. They may have concerns as well.

— The city won’t be able to recoup its costs simply by selling the excess property off the Hallmark site, City Manager David Corliss confirmed. A big part of the plan is for the city to sell the West Lawrence building that currently houses a portion of the police department. The city hopes to get $2 million or so for that office building. That sale won’t happen until the police department has moved into its new building, so we’re talking a couple of years.

— How you account for the sale of the West Lawrence building is important. That’s because the city would sell the West Lawrence building regardless of where it decides to build a new police headquarters building. So, if the city gets $2 million for the building, that is $2 million that could be used to reduce the project costs at any site.

Here’s how the math on that works: The city is proposing to build a $25.7 million building. That figure doesn’t include land costs, so at the Hallmark site, the project is about $27.9 million. But before you can say “low-calorie delight,” commissioners are reminding you the ultimate price will be $25.7 million because they’re confident they’ll recoup the $2.2 million land purchase costs. But at the VenturePark site, for example, the city also plans to build a $25.7 million building. The city already owns the property, so there are no land costs to add onto the project. The city also would still sell the West Lawrence building for an estimated $2 million. It would have those funds to reduce the cost of the project to about $23.7 million.

It is not inaccurate for the city to say the Hallmark site comes at a net zero cost to the public, if their assumptions about future sales hold true. But if people hear the net zero argument and assume that means the project at the Hallmark site won’t be any more expensive than the project would be at one of the city-owned sites, that is a bad assumption.

Now, it is important to remember that price and value are not one in the same. When confronted with the math above, Mayor Mike Amyx’s response was that he’s still convinced the Hallmark site is absolutely the best one for a police headquarters location. So, that will be one of the tasks of city officials in the coming weeks: Help the public understand the difference between price and value.

It will be an interesting election to watch. The police department has a compelling story to tell about issues of overcrowding and outdated workspaces. But even supporters of the project acknowledge that the public goes into this election with some concerns.

There’s a group of citizens who have started to informally campaign for the police headquarters project out in the community. Members of that group last night told commissioners the two concerns they most frequently hear are: 1. Why is the police headquarters building coming after the Rock Chalk Park recreation center and the new public library? 2. Why is the city buying an expensive piece of ground instead of using city-owned property for the project?

Those will be key questions supporters will attempt to answer for voters before November. It is an important development that a citizens group already is forming in support of the police headquarters issue. A strong citizen’s group is definitely part of the formula for a successful election in Lawrence.

So, voters, get ready to hear a lot more about this issue. Or in other words, let the calorie counting begin.

In other news and notes from around town:

• If keeping up with Lawrence firefighters is more your thing, good luck with that right now. Getting an update on wage negotiations between the city and the firefighters union has proved difficult. The negotiations have been at an impasse since just before Independence Day, and when I asked for an update earlier this week, I was told there wasn’t one immediately available. The city and the union have agreed to communicate to the public only through joint statements, so I thought perhaps it was just a logistical issue that caused the delay on Monday.

But I asked again for an update on Tuesday, and was told there was still not one and there was no timetable for one to be provided. It sure appears that the city and its firefighters union are so at odds that they can’t even agree on how to provide a simple update to the public.

I can’t even tell you with any certainty what the two sides are butting heads about. In early July, the firefighters union said a study has been prepared that shows firefighter wages are about 8.5 percent below those of peer communities. City officials disagreed with that assertion. I’ve asked to see that study, but have been denied access to it by city officials.

Ultimately, I expect this issue to come before the City Commission. Even though commissioners have approved the 2015 budget, they technically could still approve a raise for firefighters. The money, though, would have to come out of someone else’s line item, or else would have to come out of the city’s reserve fund. That doesn’t seem to be likely.

I’ll provide you details when I get them, but at the moment, the takeaway seems to be that the city and its firefighters aren’t getting along very well.

• On a sunnier note, the city has received word that it has won a grant for a solar energy project. Prairie Park Nature Center has been chosen by Westar Energy as one of 15 locations that the electric company will pay to have solar panels installed.

The solar panels won’t only reduce the center’s electricity costs, but also will be used as a learning tool. Plans call for a kiosk to be installed inside the center, 2730 Harper, that shows how much electricity the panels are producing at any moment. Other information about solar energy also will be provided.

Reply 1 comment from Michelle Reynolds

Lawrence home builders have best first quarter since 2010, according to new report; Hallmark undertakes another $3.3 million in construction

Shine that hammer and sharpen that saw. There are signs that the Lawrence homebuilding industry is getting busier.

According to a new report released by City Hall, builders started 23 new single-family or duplex homes in Lawrence during March. That brings the total number of single-family and duplex permits to 42, which is the highest first-quarter total since 2010.

For decades, single-family home construction has been the bread and butter of the Lawrence construction industry, and a major driver in the overall Lawrence economy. But the industry has hit hard times. In 2011, only 95 single family building permits were issued for the entire year, snapping a 55-year streak of the city issuing at least 100 new single-family building permits annually.

Since then, the industry has been creeping back. But this latest report is the best sign yet that the industry is getting a new footing. The first-quarter single-family and duplex numbers are 40 percent higher than the 2012 first-quarter numbers and are double the 2011 first-quarter totals.

The latest report also had strong numbers for several other parts of the local construction industry. Here’s a look at other figures from the March report:

• The city issued permits for $12.1 million worth of projects in March, the highest March total since 2009.

• For the year, the city has issued permits for $34.9 million worth of projects, the highest first-quarter total in the past five years.

As we’ve previously reported, Hallmark Cards is moving all of its U.S. greeting card production to its Lawrence plant as part of a reorganization. That project is continuing to pay dividends for the local construction industry. Hallmark took out a $3.3 million building permit to make interior renovations to the plant. That’s in addition to $1.2 million worth of permits Hallmark already had received for the project earlier this year. If your abacus is a bit rusty, that means Hallmark now has undertaken $4.5 million worth of work at the plant during the first three months of the year.

• The city didn’t issue any permits for new apartment construction in March, but for the first quarter, that sector has been busy. Through the first three months of the year, the city has issued permits for 286 apartment units, the highest first-quarter total of the past five years.

Reply 5 comments from Merrill Workinghard Cabmando Kansasliberal

Hallmark now believes about 200 jobs will be added to Lawrence plant when work moves from shuttered Topeka facility

Officials with Hallmark have revealed more details about their ongoing efforts to close their Topeka plant and transfer the work to the company’s Lawrence facility.

And it is more good news for Lawrence.

The greeting card company is now estimating there will be about 700 jobs at the Lawrence production center, 101 McDonald Drive, when the transition is complete at the end of the year.

That’s up from the about 500 employees the Lawrence plant has had over the past several years, and it also is more than what Hallmark officials indicated when they made the consolidation announcement in October. Back then, Hallmark officials estimated it would have about 1,000 employees in northeast Kansas and that they would be about evenly split between the company’s Lawrence and Leavenworth plants.

Hallmark officials now are estimating the Leavenworth plant will have about 300 employees.

“I would caution everyone that there is still a big ‘about’ in front of all those statements, but those are the numbers we’re planning on right now,” Linda Odell, a Hallmark spokeswoman, said.

Hallmark officials said they now expect the Topeka plant, which has been open since 1966, to close by the end of the year. Work to ready the Lawrence plant for the new employees already is under way.

As we previously reported, city officials in January issued a $600,000 building permit for interior modifications at the Hallmark plant. In February, city officials issued permits for another $556,500, bringing total construction work at the site to $1.15 million.

Odell said the company is not planning a physical expansion of the building, but rather is making modifications to the interior to accommodate additional equipment.

When the transition is complete, the Lawrence production center will produce all domestic Hallmark greeting cards and envelopes. Previously, the Topeka plant was responsible for all domestic production of envelopes, and Lawrence and Topeka shared in the greeting card production.

Lawrence’s ribbon and sticker production lines are being moved to the company’s Leavenworth plant. Odell said she didn’t yet have an estimate of how many of the new Lawrence jobs will be transfers from Topeka versus new hires to the company.

She said over the last several months Hallmark has been offering voluntary buyouts to employees who have shown an interest in leaving the company. Odell said nearly 300 employees have taken advantage of the program. Hallmark is reducing its workforce in northeast Kansas from about 1,300 to 1,000 people in an effort to improve the company’s cost structure.

Odell also didn’t have an estimate on the wages for the new positions, but she said the new Lawrence jobs would be very similar to the production positions that already exist at the plant.

Also on Tuesday, the company made two management announcements for the Lawrence plant. Lawrence resident David Millen has been appointed to oversee domestic greeting card production for Hallmark.

Millen previously had been the general manager for Hallmark’s Topeka plant. He now will oversee operations in Lawrence as part of his new job.

Keith Kennedy, who has been the general manager of the Lawrence plant since 2010, is now overseeing the consolidation efforts for Hallmark in northeast Kansas.

Reply 18 comments from Katara Shortone Gatekeeper Keith Maracas David Holroyd Jeff Goodrick Liberty275 Patkindle George_braziller and 6 others

City issues permits for $11 million in apartment construction, $600K expansion at Hallmark

Raise your hand if you believe pajamas ought to be the new business casual. I’m betting today’s blizzard has lots of folks working from home in their pj's today.

One group that you won’t find working in pajamas often is builders. (Trust me, if you try to hang a hammer from a pair of pajama bottoms, bad things happen.) And there is a new report out of City Hall that suggests January was a reasonably busy month for the Lawrence construction industry.

These days, when the Lawrence construction industry is busy, the best bet for the reason behind it is apartments. That’s the case this time, too.

City officials issued building permits for $11.9 million worth of new apartments on the large open site just west of the Wal-Mart at Sixth Street and Congressional Drive. The project — which carries an address of 5100 W. Sixth St., if you are scoring along at home — calls for 264 dwelling units in 11 buildings.

If you are trying to picture the site, it is the location that Lowe’s once was interested in. But as we began reporting last summer, apartment developers became interested in the property after Lowe’s slowed down its expansion plans. I’m not entirely clear on which developer is behind this project. At one time my understanding was that a local builder — although not one of the big apartment developers like a Schwada or a Compton — was behind the project. But the apartment industry has been full of change in Lawrence, so I had better do some more checking before I repeat a name.

I have a feeling we will have a lot of opportunities to talk about apartments in 2013. City commissioners at their Tuesday evening meeting approved the preliminary development plan for The Links, which we’ve previously reported is a major apartment development that will be built around a nine-hole golf course. That development is slated for the area northeast of Sixth Street and George Williams Way. In other words, across the street from the proposed Rock Chalk Park sports village.

The Links project — which is proposed by a group out of Arkansas — is slated to have 630 dwelling units. Add that to the 264 units that just pulled a permit next to Wal-Mart, and you are to almost 900 new units being built in the Sixth Street corridor alone. Plus, the Langston Heights development southwest of George Williams Way includes plans for 86 apartment units.

It seems that folks are betting on growth again.

A lack of growth in jobs is what Lawrence leaders have been bemoaning though. The January building permit report has important news on that front as well.

The first signs emerged of Hallmark undertaking an expansion to accommodate the extra work that the plant is planned to undertake as Hallmark closes its Topeka greeting card plant.

The company pulled a permit for $600,000 worth of work at the facility. The building permit report categorized the permit as “phase one” of an expansion project.

I’ll do some checking with Hallmark to see if they are releasing more details about their expansion plans. When the Kansas City-based company made the announcement in October of the Topeka closing, it was unclear how many new jobs may be added to the Lawrence facility. The company said it expected its total workforce in Lawrence, Topeka and Leavenworth to drop from 1,300 to 1,000, but the workers would be split between two plants instead of three.

It was clear, though, the move was going to have impacts on the Lawrence plant because it would become the sole manufacturer of Hallmark greeting cards. Previously, it manufactured about two-thirds of the greeting card line, while Topeka manufactured the other third.

Here are some other numbers from January’s building report:

• The city issued permits for $16.8 million worth of construction. That by far made it the best January in recent memory. Over the past four years, the January average was about $3 million worth of projects.

• Activity on the new-home front continued to be a bit slow. The city issued permits for eight new single-family or duplex homes, compared to seven in January 2012.

Reply 13 comments from Michaelarost Kansasredlegs Anthony Mall Number_1_grandma Keith Gotland Joe Adams Sue Grosdidier Ku_cynic Cojayrocks and 3 others