Council decides to craft tax break policy for Lee’s Summit

rpulley@lsjournal.comMay 14, 2014 

Lee’s Summit’s council decided recently it wants to create a clear incentive policy to make it easier for developers to know what to expect in its decisions.

At a council retreat May 8, Ron Holifield, a facilitator from Texas who has been a city manager in several cities and lobbyist, led a meeting where council members following the election could better know one another.

Among a rambling discussion that covered philosophy of governing and getting along, the council members did reach consensus on one major shift in practice.

The council decided it wanted to adopt a formal incentive policy to outline what it is willing to trade for jobs and development.

To date the council has had an open-ended approach, without setting limits or specifications for what kinds of development qualify for tax breaks.

Mayor Randy Rhoads said he’d met with three different developers from the Kansas City area about how the city can improve its prospects for landing more businesses, and they each said the city needed a clear incentive policy. He’s starting to agree.

“For me, that’s a 180-degree change,” Rhoads said.

Councilman Bob Johnson said that without the policy city staff gets mixed messages from the council. Developers and staff work on a project that then comes to the council and dissection begins.

“They get blindsided with all sorts of questions,” Johnson said.

The Community and Economic Development Committee, chaired by Councilman David Mosby, already has been working on suggestions for such a policy and so has the Land Clearance for Redevelopment Authority.

Mosby said not having a policy created confusion. He said the city should have a website where developers can visit to get a clear idea of the council’s expectations and priorities before proposing a project.

Daren Fristoe, an assistant to the city manager, said the city staff was working on draft of an incentive policy provided by the Lee’s Summit Economic Development Council, but it still needed refinement.

Fristoe said city staff is also reviewing incentive policies of other cities, which run from being flexible to rigid.

City Manager Steve Arbo said that a large development application can cost $200,000 plus months of time and a developer can end up betting on a single vote of eight people.

“That’s a huge risk for them,” Arbo said. “If a council member can’t philosophically get behind it, it’s pretty darn tough for (the developer).”

The council’s development committee is working on a plan for nine geographic areas where the city could take steps to market the area and improve its readiness for development.

Possible steps are improving infrastructure and updating zoning to make the process easier for a developer.

The city is working on a trial run at Tudor Road and Douglas Street, where the city is extending Tudor to the west. It is working on selecting a real-estate consultant to develop a plan and market that area to potential developers.

The council will have to wrestle with the details of the incentive policy over coming months, which might dictate whether the consensus holds.

Johnson said he wants to see emphasis on creating quality jobs with city incentives instead of retail jobs.

Councilman Allan Gray said he wanted to look at the city’s master plan and update zoning, to direct businesses to areas it thinks is appropriate.

He pointed out car washes and used-car lots at city gateways, like a car wash recently approved near Chipman and U.S. 50, which isn’t the best image, he said.

Councilman Rob Binney said he disagreed that was a mistake, because from his perspective that piece of land wasn’t the best for development.

“We’re going to run over your property rights a little,” Johnson said. “There are a certain degree of property rights I’m not going to trample.”

Binney sided with Johnson that the city needs to be cautious about dictating too much about land uses.

Councilman Derek Holland said he thought the policy needs to be somewhat directed by Lee’s Summit’s competitors’ offers for tax breaks.

“We need a better handle on what others are doing,” Holland said.

Gray agreed, saying, “It makes no sense to develop a policy that’s going to be ineffective the day we approve it.”

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