The city of Shawnee has approved a public financing package, redevelopment agreement and issuance of industrial revenue bonds for Stag’s Spring, a luxury apartment complex planned for downtown.
Kevin Tubbesing, a Shawnee developer behind the Stag’s Creek project on Shawnee Mission Parkway, is planning to build an 85,000 square foot multi-family complex in one building on about 2.7 acres at the northeast corner of Nieman and Roger roads.
In a presentation to the city council on Monday, Tyler Ellsworth with Kutak Rock LLP, the city’s bond counsel, provided brief background on the TIF project. Ellsworth said the property tax generated from the new construction over a term of 20 years to reimburse Tubbesing for costs related to the project, including land acquisition, site preparation, construction and improvements.
TIF project plan highlights include:
- Up to $3.1 million of the $13 million project is expected to be eligible for tax increment financing over a 20-year period. Those costs would be reimbursed to the developer.
- For the first 10 years of the TIF, 100% of the tax increment from the TIF district is available to reimburse the developer for eligible TIF expenses, and 80% of the tax increment is available for reimbursement for years 11 through 20.
- The agreement includes clawbacks for the developer’s failure to substantially complete the project in time. The penalty reduces the increment available for reimbursement in years 11 through 20 from 80% to 70%.
- If sufficient revenues are not generated by the project to reimburse the developer, then the city is not responsible to subsidize the difference. About $400,000 of project costs could be exempt from sales tax on construction materials.
- The city will receive an administrative fee of 0.5% of the tax increment during the life of the TIF to cover administrative costs related to the TIF district.
The council agreed to allow the city to issue up to $5 million in industrial revenue bonds to enable sales tax exemption on construction materials.
The Shawnee city council voted 6-2 to approve the redevelopment project plan, which includes the TIF agreement. Councilmembers Eric Jenkins and Mike Kemmling voted in dissent. The city council unanimously agreed to issue bonds for the project.
There was no public comment or discussion from the council. Jenkins and Kemmling have historically voted against developments that include public financing incentives.
The construction schedule in city documents indicate that construction could begin as soon as Jan. 1, 2020, and be substantially completed by July 1, 2021.