Title
Public Hearing: Second Amended and Restated Master Plan for Industrial Development Projects (Chapter 100) for the Streets of West Pryor Development; Streets of West Pryor, LLC, applicant
Body
Issue/Request:
This is a public hearing to consider the Second Amended and Restated Master Plan for Industrial Development Projects for the Streets of West Pryor Development (the “Second Amended and Restated Chapter 100 Plan”) primarily to provide a three-year extension on the use of the sales and use tax exemption certificate for the purchase of construction materials for the remaining undeveloped lots through the end of 2027.
This document amends and restates the Master Plan for Industrial Development Projects for the Streets of West Pryor Development sent to taxing jurisdictions on November 28, 2018 (the “Original Chapter 100 Plan”), as previously amended and restated by the Amended and Restated Master Plan for Industrial Development Projects for the Streets of West Pryor Development sent to taxing jurisdictions on April 28, 2021 (the “First Amended and Restated Chapter 100 Plan,” with the Original Chapter 100 Plan, as amended by the First Amended and Restated Chapter 100 Plan being the “Existing Chapter 100 Plan”). This Second Amended and Restated Chapter 100 Plan amends and restates the Existing Chapter 100 Plan in its entirety.
Key Issues:
As stated in the Second Amended Plan, due to difficult market conditions, including high interest rates, high construction costs, and the initial project delays caused by the COVID 19 pandemic, there are three commercial lots in the Commercial Project (defined below) area that remain undeveloped:
- Lot 4A (approximately 0.91 acres) is a proposed drive-through restaurant south of the existing McKeever’s grocery store and medical/retail building, west of the multi- tenant Starbucks building, and bound by NW Lowenstein drive to the south and west.
- Lot 12 (approximately 2.49 acres) and
- Lot 14A (approximately 2.94 acres) are located at the far north end of the project and are proposed to be used for retail/restaurant and hotel uses, respectively.
Proposed City Council Motion:
No action, public hearing only. The Amended Chapter 100 Master Plan will be approved by ordinance.
Background:
On December 18, 2018, the City Council held the original public hearing for the Master Plan for Industrial Development Projects for the Streets of West Pryor Development pursuant to Chapter 100 of the Revised Statutes of Missouri.
On January 8, 2019, the City Council approved the “Master Plan for Industrial Development Projects for the Streets of West Pryor Project” (the “Chapter 100 Master Plan” or the “Master Plan”) through the adoption of Ordinance No. 8540.
On February 19, 2019, the City Council approved three separate Chapter 100 transactions and the associated Chapter 100 bond documents through the adoption of three separate ordinances for:
(1) the Commercial Project (Ordinance No. 8564)
(2) the Grocery Store Project (Ordinance No. 8565) and
(3) the Apartment Project (Ordinance No. 8566)
In May 2021, Developer requested that the Chapter Master Plan be amended. On June 8, 2021, the City Council approved Ordinance No. 9161 which approved Developer’s requested amendment of the Chapter 100 Plan to accomplish the following:
(1) extend the construction period for the Commercial Project by three years to the end of 2024,
(2) update the original Master Plan with respect to the second phase of the Apartments Project by -
(A) adjusting the Cost-Benefit Analysis to reflect the delay in implementation of such phase, and
(B) change the use of such second phase from senior, age-restricted living to market-rate multifamily apartments, and
(3) adjust the map showing the anticipated boundaries of the Commercial Project and the Apartments Project.
Since the adoption of these ordinances, Developer has undertaken the construction of certain parts of the project, and has received certain additional zoning approvals. The original Chapter 100 Master Plan anticipated the issuance of taxable industrial development revenue bonds in the aggregate principal amount of not to exceed $179,000,000 in several series.
The Projects together are estimated to cost approximately $179,000,000, of which estimate approximately $94,500,000 is attributable to the Commercial Project and approximately $84,500,000 is attributable to the Apartments Project. Investments in the Projects are planned to be made in the years 2019 through 2027.
The purpose of this Second Amended and Restated Chapter 100 Plan is to extend the construction period for the Commercial Project by three years to allow for the remaining three lots to be developed using the sales and use tax exemption on construction materials.
Impact/Analysis:
The purpose of this Second Amended and Restated Chapter 100 Plan is to accomplish the
following:
(1) Provide sales tax exemption on construction materials while maintaining property tax benefits for the Developer similar to what would have been provided in reimbursement under the TIF Plan, resulting in property tax abatement on improvements under construction for the Commercial Project (defined below under Section IV) that is a component of the Projects, in an amount previously estimated at $149,219, with an additional $35,057 estimated as a result of this Second Amended and Restated Chapter 100 Plan; and
(2) Provide sales tax exemption on construction materials and a fixed schedule of payments in lieu of tax equal to an estimate of the taxes otherwise due for 12 years for each phase of the Apartments Project (defined below under Section IV) that is a component of the Projects.
The Amended and Restated Master Plan includes an updated cost benefit analysis that reflects the current state of the project and the updated costs projections and impact of the sales tax exemption. The impact of the sales tax exemption reflects the updated higher total project costs. However, the incentive being provided remains the same, and the increased sales and use tax savings is only reflective of higher total project costs. Proportionally, the overall impact remains the same as compared to the original Chapter 100 Master Plan - the same sales and use tax exemption is carried forward in the amendment to the Master Plan.
Timeline:
The project is already under construction and will continue to be constructed for up to three years, ending on December 31, 2027.
Presenters
David Bushek, Chief Counsel of Economic Development and Planning
Matt Pennington, Drake Development