City Council seems ready to kill proposed enterprise zone

rpulley@lsjournal.comJune 5, 2013 

The Lee’s Summit City Council seems ready to back away from a proposed Enhanced Enterprise Zone to provide tax incentives for creating jobs because of residents’ angry reactions to a blight designation it would splash on their neighborhoods.

For several months, the City Council and Land Clearance for Redevelopment Authority have been investigating the possibility of creating the Enhanced Enterprise Zone (EEZ) that could give local and state tax credits to businesses that expand or move to Lee’s Summit. One of the requirements of creating the zone would be a blight finding, in this case based on aging sewers, but not a comment on residential structures.

The council and LCRA also has taken steps to ask for residents’ opinions and at a lengthy, boisterous information meeting May 23, a large crowd mostly opposed creation of the EEZ. They objected to their property being labeled as blighted, fearing it will cause property values to go down. Some contend they’d have to disclose the zone when trying to sell it and say the EEZ exposes them to the risk of having their property condemned.

Others think the blight designation is more technical in nature and wouldn’t have a large effect, and for that reason reporting it on real estate disclosure forms woudn’t be mandatory. Missouri law specifically denies cities the ability to use eminent domain for solely economic development purposes, so the city could not use eminent domain to replace houses in the zone with businesses. They believe property values are safe, or could even go up as more jobs add to demand for houses.

While council members initially were open to creating an EEZ, the adamant disapproval of residents puts the EEZ in jeopardy, said council members David Mosby, Kathy Hofmann, Rob Binney and Derek Holland in interviews.

Binney said he hasn’t made a decision. He said he’s waiting to hear the full report from the LCRA at a public hearing on the EEZ to be held by the council Thursday, June 6 at City Hall.

“I don’t want to see us not look at economic incentives because of the fear factor put out there,” Binney said.

Holland said it appears the EEZ’s ability to attract the quality jobs Lee’s Summit officials want to bring to town is limited and not worth the turmoil it’s creating.

“A number of the people who have responded to the EEZ are very upset,” Holland said. “It may be overblown, but I understand…I will not support it.”

Holland said he thinks most of the council is reaching the same conclusion.

Hofmann said while she supports economic development, she thinks the city needs to scrap this proposal.

“I don’t see how I could vote for it, most of it is in my district,” Hofmann said.

She said Independence and Grandview haven’t used their EEZ that much and Columbia dropped theirs. Blue Springs doesn’t have one.

“It doesn’t seem to me to be a calling card for businesses, if it is, it’s minor,” she said.

Mosby said he hasn’t talked to other councilmembers but he expects the council to quickly dispose of the idea.

He said the city can combine other tax incentives that could support job creation instead.

Mosby said one question raised at the public forum was “why wasn’t the city blighting vacant businesses along Missouri 291.”

He noted that the city and the Lee’s Summit Land Clearance for Redevelopment Authority are already working on special zones to make tax incentives available for redevelopment of commercial corridors, with the advantage of not applying the term “blight” to adjacent neighborhoods, he said.

So he’s ready to forget about the EEZ.

“At this point I don’t feel it’s the right approach,” Mosby said. “We have other economic development tools that can be equivalent and do the same thing without blighting individual residences.”

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