photo by: Nick Krug

Lawrence City Hall, 6 E. Sixth St., is pictured on May 3, 2016.

City leaders will soon consider providing sales and property tax breaks for the expansion of an alcoholic beverage distribution company in northern Lawrence.

As part of its meeting Tuesday, the Lawrence City Commission will consider an economic development assistance request from LRICO Services LLC to expand the existing Standard Beverage building located in the Timberedge Industrial Park, according to a city staff memo to the commission. The company is looking for sales tax exemptions on construction materials and labor as well as a 10-year property tax abatement.

Standard Beverage is a Kansas-owned distributor of spirits, wines and beer founded in 1949, according to application materials. The company’s primary distribution facility in Lawrence was established in 1989 and it currently has 140 employees. Hourly warehouse and delivery employees at the facility earn an average wage of $20 per hour.

In a letter to the commission, LRICO Services LLC President Darrell Swank said that the company’s customer base significantly expanded after state law changed in 2017 to allow strong beer sales in grocery stores and other locations. Swank said the company was planning a major expansion of the Lawrence facility to meet the demand.

Specifically, the company plans to build a 118,300-square-foot expansion of its current warehouse. More than 75% of the new space would be warehouse space, and the rest would be a garage and breezeway building connected to the existing warehouse, according to application materials. The expansion would create approximately 16 new full-time jobs in the warehouse, including forklift drivers, dock door loaders, receiving and inventory control staff and other positions. The average starting wage for the new positions would be approximately $17 per hour. Construction on the expansion is expected to begin in January and be completed by the end of 2021.

Standard Beverage is requesting the issuance of up to $13.5 million in industrial revenue bonds, which would allow for the sales tax exemption on construction materials and labor. Also requested is a 10-year, 70% property tax abatement on the expansion. The 70% abatement would require the expansion to meet certain environmental standards.

Standard Beverage is applying for the incentives under the city’s Catalyst Program, a temporary fast-track incentives program for industrially zoned properties intended to spur development in the city’s business parks. Standard Beverage successfully appealed to the city in December 2019 to expand the program to include new industrial development or expansions anywhere in the city, as opposed to just in VenturePark and East Hills Business Park.

City staff said in the memo that the project would provide an economic benefit for the city, but there were no details on how much that might be. Staff also said that even with the property tax abatement, the expansion would increase the amount of property tax revenue that the facility generated. The memo said staff would work with the city’s bond counsel and the company on a performance agreement outlining development and reporting requirements for the project; that agreement would come before the commission for approval at a future date.

The City Commission will convene virtually at 5:45 p.m. Tuesday with limited staff in place at City Hall, 6 E. Sixth St. The city has asked that residents participate in the meeting virtually if they are able to do so. A link to register for the Zoom meeting and directions to submit written public comment are included in the agenda that is available on the city’s website, lawrenceks.org.