Developers of a luxury apartment complex on the east side of Kansas City, Kansas, may reapply for an economic development grant from the Board of Public Utilities.
The Yards II project was turned down for a $425,000 grant at the July 6 BPU meeting. The BPU has an economic development fund that occasionally makes grants to projects.
Appearing at the July 20 BPU meeting, David Wingerson, a development associate with Flaherty and Collins Properties, told the BPU board that the project would not move forward without the funding.
He said the economic development request would have helped the developer pay for a water line extension to the north.
Phase 1 of the project current is underway, and phase 2, which is less in scope, will cost $21 million more in the current construction market, Wingerson told the board. “At this point, the project is a no-go,” he said.
He added the developer also was open to suggestions on how to reduce some of the costs, discussing how they could pay for some of the lines.
Rose Mulvany Henry, BPU board vice president, who is on the BPU’s economic development committee, said the request for more than $400,000 would have been on top of almost $900,000 it would cost the BPU to extend the water line. In addition to that was an expense to the BPU to extend the electric line for a few hundred thousand dollars, she added.
Together, that would have meant an additional $1.1 million the BPU would have to absorb for this project, she said. The return on investment just wasn’t there, she added.
The BPU committee determined it would be fiscally imprudent for the ratepayers to bear, she said.
Mary Gonzales, BPU board president, said there was some funding in the BPU’s economic development budget that it would not be averse to using, but it couldn’t amount to $1.1 million.
Jeff Bryant, a BPU board member who is on the economic development committee, said he looked at this as luxury housing, a for-profit initiative. It’s not low-income or senior housing, he said. The project also is not going to be a large employer here, the committee believes.
“We have to go back to our ratepayers and tell them why their rates would go up,” he said. It’s hard to justify a for-profit business, he added.
The apartment project is in an area near the state line; the name refers to the former stockyards area. It was described as more than 200 units near State Line Road and American Royal Drive.
BPU members agreed that Wingerson could resubmit the grant request to the BPU committee for a smaller amount.
Wingerson said the apartment project was receiving 20-year tax increment financing from the UG.
Bryant said that if the developer resubmits the economic development request, he would like to know the number of anticipated employees. The BPU also requested to know if more assistance is being received for the project from the UG.