Figuring out how to get into a large shopping center is generally not a problem in my household. (A semi-truck and a desire to get discounted Halloween candy can smash a lot of obstacles.) But when it comes to plans for a large shopping center south of the SLT and Iowa street interchange, I have learned access issues are delaying that multimillion dollar project.
In case you have forgotten, a North Carolina development group has filed plans to build an approximately 585,000-square-foot shopping center that would include large retailers, restaurants and hotel space. The plans were filed in June, but have yet to have a hearing at City Hall. The proposed site is at the southeast corner of the interchange.
The project was tentatively scheduled to go before the Lawrence-Douglas County Planning Commission at its Oct. 25 meeting. But the city announced Thursday that won’t happen. Instead, the project’s hearing has been indefinitely delayed.
Sandra Day, the city planner who is overseeing the project, said the city, the state and the development group are struggling to come up with a plan that allows motorists to safely turn into and out of the proposed shopping center. The project wants access along Iowa Street, which is also U.S. Highway 59.
A traditional traffic signal may not work for the project because the proposed entrance point is already near the traffic signals that control the SLT and Iowa Street interchange. Day said a roundabout had been proposed for the site, but that didn’t garner favor with transportation officials. Day said the presence of the entrance and exit ramps for the SLT/Iowa Street interchange also complicates the access issues for the property.
Thus far, though, I believe the issues are all engineering-related. I haven’t heard of the parties arguing about who is going to pay for transportation infrastructure. When I’ve talked with the development group in the past, it has said it isn’t asking the city for incentives to build this project. Sometimes communities will chip in to pay for costs related to traffic signals and other such improvements. But I think that would be a deal-killer with this City Commission.
The project will have enough of a challenge getting a majority of city commissioners to approve the development under any conditions. The development group — Collett development — had a previous shopping center plan for the project rejected. It filed a lawsuit against the city, claiming the commission improperly rejected the project. That lawsuit is still pending, but in the meantime the group filed a new plan, likely because it received some encouragement to do so from some City Hall officials.
Thus far, the idea of whether the site is appropriate for a large shopping center hasn’t been a sticking point, I’ve been told. That may change once the project gets to the City Commission level, though. There have been opponents who argue the city already has enough retail space, and others who argue the city should be trying to steer new retail development to the area near Rock Chalk Park in northwest Lawrence.
But there are supporters for the project too. They note that large retailers don’t really get steered in particular directions. They instead just shift their focus to another community. Others in town simply want the new stores that the development group have been touting. Collett previously said Academy Sports, Old Navy, Designer Shoe Warehouse, a speciality grocer and others had expressed strong interest in the project.
Day said a date has not been set for the project to come before the Planning Commission for a hearing. But Day said she’s heard nothing from developers to indicate that they’ve lost interest in the project.
“They have not withdrawn the project by any means,” she said.
Commissioners faced with big questions, high stakes as they prepare to decide fate of south Iowa shopping center
When Lawrence city commissioners meet on Tuesday, the shopping fanatics among us are going to be asking questions of whether Lawrence soon will get an Academy Sports, an Old Navy and a host of other big retailers that appear ready to move into a new shopping center proposed for south of the SLT and Iowa Street interchange. But commissioners will be facing larger questions than those.
Commissioners are set to decide the zoning issues related to the proposed KTen Crossing project, a 250,000 square-foot retail center slated for the southeast corner of the SLT and Iowa Street interchange. I don’t want to be overly dramatic here, but whether the commission decides to kill this project or let it proceed does come with some fairly high stakes.
Last month I wrote about some new numbers that create some questions about downtown Lawrence and its future as a major retail center. Commissioners will have to keep that issue in mind. But there are plenty of other numbers out there that create questions too. It will be interesting to see if the commission views this proposed project mainly on its own, or whether it tries to answer some bigger picture questions along the way.
What are some of those bigger questions? Well, here’s a look:
• Why are Lawrence shoppers spending less now than they used to? The city’s most recent retail market study provided a lot of statistics on sales tax collections. One part of the study looked at sales tax collections adjusted for inflation. In 2014, the city’s 1 percent sales tax collected $14.4 million. When adjusted for inflation, the city in 2004 collected $14.3 million. In other words, when you take inflation out of the equation, Lawrence’s retail sales from 2004 to 2014 grew by a meager 0.6 percent.
To compound the issue, that is despite the fact that Lawrence had population growth during that time period. According to the city’s figures, there were about 9,100 additional people living in Lawrence in 2014 than in 2004, and yet, true retail sales growth was basically flat. The city’s per capita sales collections fell from $164 in 2004 to $149 in 2014.
One obvious answer could be that the Great Recession did take place during this decade in question. People did clamp down on their spending. Maybe this drop-off is similar to what every other city experienced. The city’s retail market report doesn’t provide information on whether other cities had such a drop-off.
But there are other numbers that create concern that more may be at play here than the recession. The further you look back at the numbers, the worse the picture looks. From 2000 to 2008 — a period where the economy was humming — per capita sales tax collections dropped from $178 in 2000 to $156 in 2008.
Another answer may be that Lawrence residents are just making less money, so they are spending less money. That, however, is not what’s the city’s numbers show. The retail market study lists per capita income numbers that also have been adjusted for inflation. The most recent data is for 2013. It shows income levels from 2003 to 2013 grew by 5.8 percent, after inflation. It is certainly debatable whether that is a healthy amount of income growth — it is about a half-percent a year, after inflation — but it is accurate to say that Lawrence residents had more money in their pockets.
Of course, a third answer is that more Lawrence residents are shopping out of town as the number of retail shopping outlets in the Kansas City and Topeka markets have grown at a faster pace than the number of shopping options in Lawrence. Obviously, that is the answer the development group for KTen Crossing wants the city to land on.
Just to be clear, I don’t know the answer to the question, but it sure seems like an important one for the City Commission to figure out.
• How big of a player does Lawrence want to be in the retail world? The state produces a statistic called a trade pull factor for every major city in the state. It is basically a way of comparing a community’s per capita sales tax collections with the statewide per capita sales tax collections. It is not a perfect statistic, but it is a quick way to see if you are keeping up with the Joneses.
The most recent pull factor for Lawrence shows we’re at 1.04, which means our per capita sales tax collections are 4 percent better than the statewide average. Should commissioners be happy with being 4 percent better than average? That’s clearly a judgment call.
Lawrence is the largest city in the fifth largest county in the state. Lawrence, however, is not near the top five when it comes to pull factor rankings. Of the 25 first class cities in the state — a term used to describe some of the larger cities in the state — Lawrence ranks No. 16. Lenexa leads the pack. It is 55 percent above average. Some others of note: Overland Park is 43 percent above average; Topeka 32 percent above average; Manhattan 29 percent above average; Olathe 16 percent above average; and Wichita 12 percent above average. The two cities closest to Lawrence are Emporia at 8 percent above average and Coffeyville at 2 percent above average.
This is a one-year snapshot, which is not ideal. But, I have watched these numbers over the years, and Lawrence has always struggled to rank very high on the list. Some would say there is a reason that has been the case: our geography. Lawrence struggles to rise on the list because the draw of Kansas City and Topeka shopping is always going to depress the amount of shopping that occurs in Lawrence.
At some point, city leaders need to determine how much they buy into that argument. How far above average can Lawrence be? How much can we convince Lawrence shoppers to shop locally? Developers of the proposed shopping center are arguing this development will help keep shoppers in Lawrence, and may bring in some new shoppers from outside the city, most notably from Franklin County to the south.
Again, I don’t have the answer, but it appears Lawrence needs to figure out how much it wants to compete for the retail dollars in the region.
• How do we want to tax ourselves? Cities usually get most of their money to pay for basic services through sales taxes and property taxes. Communities that rely heavily on sales taxes feel one way. Communities that rely heavily on property taxes feel a different way. Usually, communities have a strategy for what type of mix they want to have when it comes to sales and property taxes.
My perception of Lawrence city government over the last 20 years is that there had been a desire to make sales taxes a greater part of the mix in order to provide some property tax relief.
There is some evidence that was the case at one point. In 1995, the total number of dollars in the city’s general fund budget that came from sales tax collections were 38 percent. That percentage steadily grew over the years. I think the high point came around 2002 — I might be off a year or two — when 47 percent of budgeted general fund revenues came from sales tax dollars. By 2005, that number dropped to 44 percent. In the 2015 budget, it has dropped to 40 percent.
Again, I don’t know what the “right” number is for Lawrence. But I think it is important to note that our revenue strategy in the city is changing. Has it been intentional? What are the consequences of it? For instance, has our changing tax structure played a role in the affordable housing issue that community leaders are discussing? It seems that city commissioners need to figure out whether these numbers cause them any concern and, if so, whether they think increasing the supply of retail options in the city will help change those numbers? It is a big question, and a tough one.
The question that many folks are probably most interested in is whether this shopping center proposal can win three votes at the City Commission? It is uncertain. My view, for whatever that is worth is that Matthew Herbert is a strong yes and Leslie Soden is a likely no, based on comments both of them made during the campaign earlier this year.
I chatted earlier this week with Commissioner Stuart Boley. He told me he’s open to the proposal, which I think means he hasn’t made up his mind yet. He did note that he’s uncertain how much this development will end up costing the city. The development is not asking for financial incentives like tax increment financing or special taxing districts. But Boley mentioned items like the cost to extend water and sewer service to the site and road improvements.
I had City Hall reporter Nikki Wentling ask the development group about that issue while she was covering yesterday’s informational meeting about the project. The group told her that it plans to pay “its fair share” for those infrastructure costs. Often, development groups form a benefit district, where all property owners in the district that will benefit from the extension of utility services will pay a portion of the costs. The city sometimes pays a portion too, but not always.
But it is worth noting that the city has already annexed the property, which means it is in a poor position to argue that it is too costly to extend basic utility services to the site. If the city felt that way, the normal course would be to not annex the property.
Then there is Mayor Mike Amyx. I think he is struggling with an issue that several people are. Based on conversations I’ve had with him, I think he doesn’t want Lawrence to become too out of balance geographically in its retail offerings. If this project proceeds, how much more difficult will it become for a retail area to develop around the Rock Chalk Park property in northwest Lawrence? That is a question that people are struggling with. But on the flip side of that coin, people also are struggling with the fact that the property around Rock Chalk Park has been available for retail development for a number of years now, and the retailers just have not come to the table.
Amyx told me earlier this week that if his crystal ball was working better that this would be a much easier decision.