Healthy Campus project design process put on ‘pause’ while UG searches for grocer
A downtown grocery store and YMCA community center remains as a Unified Government goal despite a vote taken Thursday night that would “pause” the design process for the project, according to UG officials.
After a lengthy discussion and an appearance by community residents in support of the Healthy Campus project, the Unified Government Commission on Thursday night approved UG Administrator Doug Bach’s proposal to “modify current YMCA – grocery store development process to focus primary efforts on securing a grocery store for the downtown – northeast areas.”
Residents went to the podium to express their support for the Healthy Campus and their concerns about the Healthy Campus project losing momentum among donors.
UG officials said the action taken Thursday night was not a vote to end the Healthy Campus project.
Instead, it reflects a changing situation since the UG Commission directed the UG administrator to move forward with design plans for the proposed site, according to officials. The UG doesn’t yet have an agreement with a grocer, according to Bach.
Some UG commissioners stated at the meeting they felt it was necessary to pause the design process in order not to be wasteful of UG funding for designing something that could be changed later at the request of a grocer who is not yet on board with the project.
UG Commissioner Melissa Bynum, who voted against the proposed pause in the design process, stated later that her understanding is that the UG will come back in 90 days or less to receive a report on any progress that is made.
“I think it means the Y and grocery store could stay coupled as a campus plan, or they could also proceed on their own,” Bynum stated on Friday. “I’m grateful the folks with the Y still believe in the vision for a healthy campus and still support not only a new Y, but the campus vision. That’s what I understand them to reiterate to us last night.”
Walters: ‘You shouldn’t hire architects if you don’t know what you’re building’
The situation was summed up Thursday night by Commissioner Jim Walters.
“Two and a half months ago, we directed Doug and staff to proceed with all due haste to complete the design work so we could get ready to make a submission for tax credits, and to purchase options on the property that this project occupies,” Commissioner Walters, an architect, said. “So he’s spending money. This isn’t ‘do we want to do it or not want to do it.’ We’re doing it right now. The question is, that he has brought to us, is ‘do you want me to proceed like you told me to, two months ago, at all due haste, to get this thing done, because there are a couple of things that have changed.’
“One, the New Market Tax Credit deadline, that was a gun to our head, it went away, they were extended for another year. By the way, the grocer that we really thought we had a deal with, we don’t have a deal with that grocer,” Walters said. “‘So, commission, do you want me to proceed full speed ahead like you told me to two months ago, or do you want me to pause, because I’m spending up to $2 million.’ So that’s why I think it’s prudent for us to do exactly what Doug suggested, and that is pause until we figure out what we’re doing.
“My experience is you shouldn’t hire architects to design buildings if you don’t know what you’re building, and I think it’s prudent for us to do exactly what he suggested,” Walters said.
Townsend: It all started with the need for a grocery store
Commissioner Gayle Townsend, who made the motion to accept the administrator’s recommendation, said the conversation first started with the need for a grocery store. This proposal enhances the opportunity to get a downtown area grocery store, she said.
“It would be imprudent and irresponsible for us to use the money that has been entrusted to us to do the right thing, to take that vote now,” Townsend said.
“How can we talk about acquiring land when we don’t have a key component of what this plan was about?” she asked.
Johnson: Make sure the numbers are solid
Commissioner Harold Johnson said they need to ensure the pledges made to the YMCA project are still solid, and make sure the numbers they are working with for construction are still solid.
“We do need to identify a partner for the grocery store,” he said. “Our community has suffered far too long.
“We need to take the time to find the right partner to come to the table with us to help complete this process, so we can make good on the commitments given to this community three to four years ago, as a matter of fact, even longer than that, and start to improve the overall quality of life for all of Wyandotte County, particularly those east of I-635,” Johnson said.
“I’d rather make sure that we measure one more time before we cut, and make sure all of our numbers are solid numbers,” Johnson said. “We’re in an environment where construction costs continue to go up day by day.”
He also said the UG should look at the most cost-effective way to do this so it is not putting more encumbrances upon its citizens. He wanted to see it move forward and done right before it is signed.
Bynum: Working on a vision
Commissioner Bynum, who favored tabling the administrator’s request to delay the Healthy Campus design project, said there was extensive public engagement conducted to arrive at the Healthy Campus plan.
Recently, a UG committee heard that senior citizens who use the UG’s paratransit system were experiencing delays in transportation to get to doctor appointments and grocery stores, she noted.
“That’s part of why it troubles me to push a pause button if that’s what we’re saying,” Bynum said. “It’s compounding what those folks are facing to get to some healthy food.
“It’s difficult to find healthy food choices in our downtown and in our urban core, and so to delay it is troubling, to say the least,” she said.
She was concerned about keeping the momentum of the donors. She also was concerned about communications with those working on the project.
“I hope that whatever we do moving forward, we engage those partners who came to the table to help us make the plan or vision,” Bynum said.
She added that what is being heard from residents involved in the Northeast Master Planning process was the need for a grocery.
“But what we were working on wasn’t just a grocery store, and we heard that in the public comments tonight, we were working on a vision, we were working on something that could be a catalyst for so many of the people who live in this community,” Bynum said. “I ask that we do not give up on working on the vision on which we had so much public engagement for so many years.”
UG administrator: Time to press ‘pause’
Commissioner Jane Philbrook asked Bach the cost for the program if it goes forward. Bach said if $37 million in bonds was issued, and just held forward in an account, the UG would spend several hundred thousand dollars for issuing it and in interest costs.
She asked how long it would take to reach an agreement with the present grocer.
“With the present negotiations we have, the practicality of reaching a conclusion on the deal we’re doing now is not likely,” Bach said. “That we may be able to reach a different kind of agreement with them, is.”
He said he couldn’t talk about everything that is in negotiations, and many grocers would not want to announce who they are until they have signed an agreement.
If there are bonds issued for this project now, the UG has to move forward with the design, close and buy the property and move forward with engineering work, Bach said.
“We will blow past a couple million dollars,” he said, “and then I may come to you and say, that will not get you the grocery store project, we need to do something different.”
If they don’t make an agreement with the grocer first, he believes the UG could spend a lot of money and still not get the project they want.
“This is the time to press ‘pause’ on the project, where we re-evaluate how to make this happen and how to make this successful,” Bach said at the meeting.
YMCA: ‘We do not want to leave this community’
Philbrook asked if the project is delayed a year, would the YMCA wait.
David Byrd, president of the Greater Kansas City YMCA, said at the meeting that donors all share an interest in the YMCA and grocery store together.
“The synergy around this is very powerful and unique if we get it done,” he said.
They will have to make some decisions, possibly about closing parts of the century-old YMCA downtown KCK building, if this is delayed again, Byrd said.
Byrd said if they miss this round of the New Market Tax Credits, it is at least a year away. He said he hoped that an announcement would be made about the tax credits later this month. There are a number of requests out from the YMCA now on the combined grocery store-YMCA project, he said.
Byrd said they will find out which organizations will receive these funds from the federal government, then will go and apply for these tax credits. Bach said the UG has not completed the application for the tax credits.
“The Y is in this for the long haul,” Byrd said. “We do not want to leave this community.”
“We will be facing some challenging decisions if we continue to delay,” he said. “But we’re committed and we’re with you.”
Bach: ‘Focus on the grocery store’
During the Thursday night meeting, Bach said in November 2017, the UG Commission authorized the UG to spend up to $2 million for options for the property, for engineering, site work and design plans, Bach said. The intent was to design the YMCA community center, with an adjoining grocery store and a retail area, he said.
He said the UG continues to support that project. While there is commitment from the YMCA portion of the project, the grocery operator is not yet on board, according to UG officials.
Last November, the UG administrator said they were working with a grocery store operator and felt optimistic at the time that it would advance by this time. A fairly large bond issue is necessary in order to put the project in play, he said. To apply for the New Market Tax Credits, all the funding options have to be in hand at the time that they submit for the bonding, Bach said.
“We would need to be able to show that we could be up to the $37 million that would be needed to make this project advance,” Bach said. “At this time, unfortunately, we have not been able to secure a grocery operator to be part of the project, so that’s making us take a step back a little bit and spend a little more time working on it.”
If the UG were to move forward at this point with the project, and finalize plans without having a grocery operator, the UG would approve a bond issue and spend additional money on plans that don’t necessarily meet the needs of a grocery store operator that it would eventually get, Bach said.
“That would take us in the wrong direction,” he said. If the UG approves a design now, and later finds a grocery store operator who wants major changes to it, it could derail the project completely, he said.
“We just want to be able to focus on the grocery store,” Bach said. It takes the UG out of the cycle for New Market Tax Credits for 2018, he added. Those tax credits have been renewed for 2019 and could be available then, he added.
Once the grocery store operator is in hand, the development would come back to the UG Commission for approval, and they would work with packaging it with the YMCA community center, he said.
Some UG commissioners expressed surprise that the grocer was not yet on board, and the tax credit application was not yet made.
Mayor Alvey: A need for fiscal responsibility
Mayor David Alvey said while there was a need for a grocery store downtown, and the project was a good vision, there was also a need for fiscal responsibility.
“It is clear in this county and this city, that the tax burden continues to be a concern of our residents,” Alvey said. “It’s undeniable. The question is, how do we manage these priorities?”
As the UG tries to provide more amenities, it needs more funds. As it tries to reduce taxes, there are less funds available for amenities, he said. So it comes down to a community conversation about priorities, he added.
He cited commission concerns from a Dec. 21 UG meeting about the site costs of the project and a 2 mill expense for it.
“My belief is this, if we create a project, or move forward on a project before we know that this is going to be sustainable on its own, we’re committing not only this commission, but five years down the road, another commission, and seven years, another commission,” Alvey said.
If the project is not financially sustainable, then the UG is committing one to two, or more mills, each year, down the road, he said. “That’s a big stretch.”
“I’m confident there are sustainable models for urban groceries and for a Y, and I think we have to find that sustainable model,” Alvey said. “The worst thing we could do would be to move forward on a grocery project that requires a stop-loss agreement, or a subsidy, then five years down the road, because we hit another recession, and because we have now structured the revenue for Unified Government to be more dependent upon sales taxes – in a recession, that’s what suffers the most first – we’re going to be faced with either continuing to sustain the Y and the grocery, or cutting services elsewhere.”
It would be a “slap in the face” to the community if the UG was to build a grocery and then have to close it in five years if it wasn’t sustainable. He said he understood the UG might have to help build and furnish it, but operating subsidies are another matter, he said.
“We have to find a sustainable model for an urban grocery,” he said.
The UG is confident that it can create sustainable models downtown that will not depend on the goodwill or lack of goodwill of future commissions, he said.
Alvey said he would do anything he could to help sustain the philanthropic community, and the message to the philanthropic community should be that “We are going to do this in such a way that it will be sustained.”
“This will be an institution that will be here for another 80 years,” Alvey said.
Commissioners’ comments: $7.9 million for site work questioned
Commissioner Brian McKiernan said that at an earlier meeting, he had questioned $7.9 million being proposed for parking, utility relocation, streetscapes and site work expenses for this project, and the 2 mills that was said to be needed for it, but he did not want that to torpedo the project.
Usually, the UG tells the developer to pay for the site work, and the UG gives it the tax increment financing district, he said. He said he was surprised to see this “pause” item on the agenda Thursday night, because he just wanted to continue the conversation about options.
He said he was firmly committed to a grocery store and YMCA, but they just need a commitment from the grocer. He said he believes the project will be successful.
Bynum said during the discussion that she was disappointed with a lack of communication with the commission, public and everyone working on the Healthy Campus project. However, she said she would work toward bringing a sustainable model downtown.
Commissioner Jane Philbrook wanted the motion to include the continued vision of the Healthy Campus grocery and YMCA. The proposed motion read that it would “modify current YMCA-grocery store development process to focus primary efforts on securing a grocery store for the downtown-northeast areas.” While most of the commissioners expressed their intent during the meeting in favor of the Healthy Campus project, they did not vote on Commissioner Philbrook’s idea to put the Healthy Campus phrase into the motion that was approved.
“This is a vision that is of a first-class facility that will not only meet the needs of the community, but most importantly, we want it to succeed,” Commissioner Tom Burroughs said. “This project is a major investment of both financials and good will for the community, but it’s also a catalyst for our downtown. It’s a project that must succeed, and it’s a project in its uniqueness that our partners and developers deserve it to succeed.”
He said there isn’t a commissioner who doesn’t want to see the project take place.
“We would be remiss if we moved forward and spent our money, your money, tax dollar money in an imprudent manner,” Burroughs said. “We must be fiscally responsible that when projects like this advance, that we could be in a position to use a general fund and not a g.o. (general obligation) bond, and the only way to do that is to approach these projects in a fiscal manner.”
He said the project needs to move forward in a first-class manner.
Residents speak in favor of Healthy Campus project
Six residents spoke out in support of the Healthy Campus project at the meeting. Wil Anderson, chair of the Downtown Shareholders, said he was concerned about the lack of information coming out about this project.
“We want to make sure the community is involved in the decision process,” he said. If it is just a delay, great, he said, but a long-term postponement would upset the applecart.
Kate Lynch said she exercises at the downtown KCK YMCA, and she wanted the officials to know, if they pushed the pause button on the YMCA, what they were pushing the pause button on. She talked about families that exercise together, senior citizens who meet there daily, young men and women playing basketball, professionals who meet there each day, and older residents who work out and then meet for coffee. Kids’ nights out, Easter egg hunts, soccer clinics, breakfast with Santa, healthy living clinics, diabetic cooking classes and senior citizen socials are some of the other activities, she said.
Nozella Brown, said residents and about 35 organizations here have worked several years for a project that goes beyond a grocery store and improves health in the county. She said she is very concerned about the loss of grocery stores here, and health is more than just a grocery store.
“It really is more than just a grocery store,” she said. “It is a project that has been a catalyst for growth and revitalization in the downtown Kansas City, Kansas, area. It is a project that has begun to address the poverty and some of the needs that we have had.
“We’ve had some commitments for funding that we don’t want to lose,” she said. There are about $6 million in philanthropic commitments to build the center, and the Wyandotte County Health Foundation has committed $1 million.
“We don’t want to lose the momentum we already have in place in our community,” Brown said.
Katherine Kelly, with Cultivate KC, said she served on an advisory committee for the project and had participated in several meetings concerning the Healthy Campus, said it was helpful to hear it was not a total derailment of the project, but she had concerns that if the momentum was lost, it would go the way of too many good ideas the city and county have had that never become real.
“This project needs to become real,” she said. “We need a grocery store. We need a widely engaged YMCA. We need retail to help attract people to that area. I would also second the original speaker requesting more timely information. I have been involved in this project, and there has been little information on how this came about.”
She said she would appreciate more information in the future on it.
“I love this vision. I think it’s going to be unique in the Kansas City metro area, I think it has the potential to attract people from all over the metro if we do it right,” she said. “If we just put in a grocery store, if we just put in a YMCA, that’s not going to have the same kind of economic appeal and community appeal.”
Mary Collins, a resident, said the financial projections in the original Healthy Campus plan appeared to be careful and conservative to her, and the original vision is sound.
“I want amenities in my neighborhood,” Collins said. “We deserve them just as much as residents of other municipalities in our area. I don’t want to have to drive so far for my groceries and for recreational opportunities. This project was originally constituted as vital to the health and well-being of our city, from both a health and wellness and an economic development perspective.
“I urge the commission to direct the staff to continue to pursue the plan as originally intended, and not to pause the project and derail the momentum to a new project,” she said.
Beth Low-Smith, with KC Healthy Kids, said it was confusing that this issue was being taken to a vote by the commission before talking to the persons that have been engaged throughout the project. The community has indicated it wanted a project that included a community center, she said.
“The input of residents should really matter,” she said. The half-million spent in planning activities for this center should matter, also, she said.
“The vote to invest additional funds less than two months ago ought to matter,” she said.
“It seems to send a bad signal to donors who have committed to the project and surely it’s a bad idea for the UG to turn off donors who have made long-standing commitments,” she said. “Such action may have echoes for future projects, whatever the outcome of this one.”
The 6-1 vote, with Commissioner Melissa Bynum voting no, approved Bach’s proposed recommendation and added that the UG administrator would come back with a report within 90 days. Not present at the meeting were Commissioners Angela Markley, Ann Brandau Murguia and Mike Kane.
For more details about the UG meeting, visit the UG meeting on YouTube at https://www.youtube.com/watch?v=nyO00b5wGbc.