Refinancing of existing Indian Springs general obligation bonds, and a $10 million authorization for flood wall protection on the Kaw River Bank at Turkey Creek moved forward at the Monday night Unified Government Economic Development and Finance Committee meeting.
The two items will be considered at the Thursday, March 7, UG full commission meeting.
The Indian Springs refinancing is a home rule ordinance that would allow the UG to refinance general obligation bonds that had been previously issued in three issues in three different years, according to Kathleen von Achen, UG chief financial officer. The refunding amount would be $12 million.
The UG is currently paying down the debt on these bonds that were issued previously. While advance refunding on tax-exempt bonds has been prohibited, these are taxable bonds, she said.
Refinancing the bonds will allow for the existing project plan, which has only eight years remaining, to be ended, she said.
She estimated dthe UG would save around $552,000 or 5 percent of the total borrowing costs.
Commissioner Ann Brandau Murguia said the public should know that the UG took much of the Indian Springs property in 2007 by eminent domain, then demolished it, with plans for redevelopment that did not happen yet. The UG is paying about $1.4 million a year on the existing bond issues. She said the financial staff has done a great job with the refinancing plan.
The UG had a developer lined up in the early days following the eminent domain; however, the developer died during the project and a recession hit.
“The pending project is great,” Commissioner Murguia said. Many projects have come forward during the years, and the current proposal for Indian Springs to be developed in the KC Foodie Park, an mixed use project including an industrial food service center, with office space and also with restaurants along State Avenue, plus other planned buildings.
Commissioner Brian McKiernan said he wants the current project to succeed, and even if it doesn’t come to fruition, true savings would be utilized by this refinancing plan. According to UG officials, they are still working on the development agreement with Scavuzzo’s for Foodie Park. The project is expected to create new jobs.
Commissioner Tom Burroughs said it is a very challenging site, and most communities were also hit by the 2009 recession.
Kaw River Bank at Turkey Creek stabilization
Also approved by the committee was a resolution allowing the sale of general obligation temporary notes to fund $7.5 million for the Kaw River Bank Turkey Creek stabilization project. The total project cost is $10 million.
The UG had already approved $2.5 million toward this project, with another $2.5 million planned for the next year, but new information that the extent of the damage is more than previously thought is leading the UG to repair the wall as soon as possible, before the rivers rise, according to officials.
According to Debbie Jonscher, UG deputy CFO, in July 2014 a small hole was found in the wing wall and in August 2017, the wing wall and flood wall failed. The UG applied for funding through the Federal Emergency Management Administration, but was denied. It is being appealed.
The area of the wing wall failure is close to railroad tracks, and could cost a railroad millions of dollars if the tracks are closed, according to UG officials.
The location, according to UG officials, is east of 7th Street turning into Rainbow Boulevard. It is close to the boundary with Kansas City, Missouri. UG officials said they hoped that Kansas City, Missouri, will help provide funding, since it is downstream.
According to UG officials, Kansas City, Missouri, has been receptive to the idea of cost-sharing but the UG is not sure of how much it will be.
In answer to a question from Commissioner McKiernan, the UG’s public works director said this project is not part of the Turkey Creek flood project that previously was done.
Commissioner Burroughs said he would like the UG to get the best negotiated position it can get on this issue.
Commissioner Murguia said if there is no help forthcoming from the other parties, maybe the UG could seek legal counsel on it.
Public hearing on downtown grocery store
Also approved at the Monday night committee meeting was setting a public hearing date of April 11 for the downtown Kansas City, Kansas, grocery store development plan. That also will go to the March 7 UG Commission meeting for approval.
Katherine Cartarr, UG director of economic development, said the public hearing for 7 p.m. April 11 would be on the project plan for the grocery store at 5th and Minnesota. The public hearing will be on the redevelopment plan for project area 1, which is the grocery store area that is currently a parking lot at 5th and Minnesota.
In other action, the committee approved its lease purchase agreement with the Banc of America for $11.5 million to acquire and install equipment.
The committee also approved the revised debt policy, which brings the UG’s policy into agreement with current practices.
The meeting is online at https://www.youtube.com/watch?v=kNgTliplVrQ.
