Title
Public Hearing: NW Main & NE Douglas Community Improvement District; Douglas Street between Tudor Road and Chipman Road; Phillips Edison Company, LLC, and property owners as applicants
Body
Issue/Request:
This is a public hearing for a proposed community improvement district which has been filed by the property owners within the proposed CID area for a development being pursued by Phillip Edison, LLC (“Developer”), on approximately 22 acres of property for a new 99,000 square foot grocery store and additional retail development located on Douglas Street, west of Lee’s Summit North High School, mid-block between NW Tudor Road and E Chipman Road.
Key Issues:
Public hearing to take evidence and testimony for the proposed community improvement district to fund eligible public improvements costs associated with the project.
Background:
On July 7, 2026, the City Council heard a conceptual presentation from the Developer for a proposed community improvement district which would impose a new sales tax to reimburse developer for public improvements costs and demolition and site clearance costs. The Council provided positive non-binding feedback to Developer regarding the incentive request following the conceptual presentation.
The City Council is now being requested to consider an ordinance establishing the NW Main and NE Douglas Community Improvement District under the Community Improvement District Act, Sections 67.1401 to 67.1571, RSMo. A petition to create the District was filed with the City Clerk on August 21, 2026. It was signed by the owners of real property within the proposed boundaries, representing assessed value equal to the District's total assessed valuation of $92,072.
The proposed District contains approximately 19.13 acres located between NW Main Street and NE Douglas Street, south of the apartments development. It District area is planned for a grocery-anchored commercial development with additional retail and fuel sales. The District would be a political subdivision of the State governed by a five-member Board of Directors. Successor directors would be appointed by the Mayor with the consent of the City Council.
The District's sole revenue source would be a sales and use tax of up to one percent on taxable retail sales within the District, subject to approval by the District's qualified voters. The tax would not apply to motor vehicles, trailers, boats, or outboard motors, or to sales to or by public utilities and communications, cable, or video providers. The District would not be authorized to levy real property taxes, business license taxes, or special assessments. Its maximum term of the District is 27 years from the effective date of the ordinance that approved the Petition.
The petition estimates District-eligible costs of $11,477,043, out of a total estimated project budget of $26,412,352 for non-vertical construction costs associated with the categories of land acquisition, demolition of existing improvements, the construction of on-site public improvements and off-site public improvements. These costs fall into three CID reimbursement categories.
The first category, totaling approximately $2.35 million, consists of improvements within public right-of-way to serve the project. These would be built to City standards under the Unified Development Ordinance and the Design and Construction Manual (DCM) and dedicated to the City. They include widening, milling, and overlay of NE Douglas Street; a sidewalk, access drives, and right-turn lanes; medians; a new traffic signal; relocation of street lights; and burial of overhead electric lines.
The second category, with approximately $3.296 million in potentially CID-eligible reimbursable costs, consists of improvements within the District that qualify as public improvements under the CID Act but would not otherwise be funded by the City. These are principally about 291,690 square feet of parking and circulation areas and about 72,990 square feet of stormwater detention. The parking and circulation areas are eligible because they would be open to the public, subject to reasonable time, place, and manner regulations comparable to those the City applies to its own parking facilities. They would also carry an incident of public ownership through public ownership, a long-term lease to the District, or a public easement.
The third category is blight remediation. The petitioners request a Council determination that the District is a blighted area within the meaning of the CID Act, based on a Blight Study prepared by Sterrett Urban, LLC, dated July 21, 2026. They also request a finding that District-funded demolition and site preparation are reasonably anticipated to remediate the blighting conditions and will serve a public purpose. The budget includes $232,997 for demolition of existing homes and structures and general site clearing and other demolition costs.
The remaining District-eligible costs, approximately $5.48 million, are land costs and soft costs allocated to the public areas within the boundaries of the District. These include land acquisition, engineering, City review fees, legal, entitlements, planning, survey, traffic study, civil drawings, testing and inspections, general conditions, a development fee, and contingency.
Reimbursement of eligible costs would be governed by the CID Cooperative Agreement that would be approved by the same ordinance that approves the Petition. The District would be required by statute to competitively bid construction contracts that it executes, if any, over $5,000 and to reimburse the City annually for its administrative costs, up to 1.5% of District revenues.
Impact/Analysis:
The total project costs is projected by Developer at $48,867,210. The total maximum principal amount reimbursable under the Cooperative Agreement is $6,788,000. This reimbursable amount is about 13.9% of the total project costs. The City’s presentation slides provide an initial analysis and evaluation of the request.
Presenter
Patricia Jensen, Rouse Frets White Goss Gentile Rhoads, P.C., attorney for applicant
David Bushek, economic development legal counsel for the City
Ryan Elam, Assistant City Manager