Planning Commission approves permit for Woodlands’ reopening

UG Commission to consider permit on April 28

by Mary Rupert

On an 8-2 vote in a crowded meeting room, the Kansas City, Kan., Planning Commission on Monday night approved a special use permit for The Woodlands racetrack to reopen with horse racing and slot machines.

After a challenge during a public hearing from a group calling itself Protect the Partnership and from the nearby Hollywood Casino, the Planning Commission added about 14 stipulations onto the permit, in addition to some stipulations the staff recommended earlier.

Next, the permit is scheduled to be considered at the Unified Government Commission meeting on April 28 at City Hall, 701 N. 7th St., Kansas City, Kan.

A Las Vegas casino owner, Phil Ruffin, has purchased The Woodlands racetrack at 97th and Leavenworth Road and wants to redevelop it, retaining horse racing and adding slot machines, according to Scott Beeler, a lawyer representing him. Ruffin’s son, Phil Ruffin Jr., was attending the Monday night meeting.

An ‘all-in’ investment

Beeler said The Woodlands would make an investment of at least $70 million, and would renovate or replace between 85,000 and 100,000 square feet. He said it was an “all-in” investment, and it did not include any tax breaks or any bond issues from the local government.

Beeler also said The Woodlands would apply to the state’s Racing and Gaming Commission for 750 slot machines. The law would allow an application for up to 2,800 slot machines.

He said The Woodlands, which was built in 1989 and has been empty since 2008, could provide from 500 to 700 full-time equivalent jobs.

While the Kansas Senate has passed legislation that would give The Woodlands’ owners the same percentage of gaming revenues as the casinos, the Kansas House has not yet passed that bill. Currently, the law governing The Woodlands states that owners will pay 40 percent of the slots proceeds to the state, as compared to 22 percent of gaming revenues that casinos pay to the state.

Supporters: No monopoly

Lou Braswell, executive director of the Leavenworth Road Association, said the majority of the LRA’s board supports The Woodlands reopening. Ruffin is not asking the UG for any tax breaks, she said.

“He didn’t’ come with his hand out, he came with his wallet open,” she said. “We’ve waited and waited and now we’ve got a person willing to invest.”

Braswell said she didn’t want a monopoly here on gaming.

Mark Evans, past president of the Kansas Thoroughbred Association, said reopening horse racing throughout Kansas would bring 4,000 new jobs to the state and $300 million in new wages statewide.

One area resident, Laurie Torrez, said she supported The Woodlands, as Piper needed more revenue for its schools. She said it was a “no brainer” and the commission should support it.

Janet Madsen, a resident of Kansas City, Kan., said hundreds of Kansas residents leave to visit other states in order to bet on horse races. She said she enjoys the horse races more than playing slot machines.

Another Kansas City, Kan., resident said he had purchased a racehorse, and he talked about how a horse track would be good for tourism here, bringing visitors from out of state.

Opponents call for more details

Some opponents wanted more information, including a complete development agreement, before the project moved forward.

“It’s like me going home and asking Mom to give me a blank check,” Mary Martin, a Wyandotte County resident, said about The Woodlands’ proposal.

Stephanie Kimber, a Kansas City, Kan., resident, said she believed The Woodlands’ fiscal responsibility was not just to Piper but should be to all Wyandotte County schools as well. A development agreement with the Hollywood Casino distributed additional funds to all the Wyandotte County school districts. Later in the meeting, Beeler pointed out that the school district taxes by law go to Piper.

Postcards from Protect the Partnership that have been sent out to Wyandotte County residents warned that Hollywood Casino might lose business as a result of the reopening of The Woodlands, and said 50 or more jobs were on the line there. Also, the postcard hinted that the three Kansas state-run casinos could ask Kansas for their privilege fees back, in the millions of dollars, and they questioned whether the current agreements with the casinos would be broken if the racinos were approved.

“Three bullet points do not make a development agreement,” said Valerie Mussett, board chair of the Kansas City, Kan., Area Chamber of Commerce. She said a development agreement should be completed before the permit is brought to the commission.

She said the chamber supports gaming as long as the proposal brings jobs and prosperity to the community. She said Ruffin and lobbyists are seeking a substantial reduction from legislators in the gaming revenue rate they originally agreed to years ago.

According to Beeler, the law states The Woodlands has to pay 40 percent of the slots gaming proceeds to the state while the casinos have to pay 22 percent. The racetracks are currently lobbying legislators for the same percentage as the casinos.

Mussett said the Hollywood Casino generates about $4 million for the community in addition to the gaming taxes, and the grant dollars are important to many charities.

“I urge you to reject the request tonight as it is premature and absent any formal development agreement with the UG which would recognize and uphold the interests of these organizations and the community as a whole,” Mussett said.

Greg Kindle, president of the Wyandotte Economic Development Council, said they would like The Woodlands to become an agricultural-based destination development, beyond just reopening the horse racetrack and adding slots.

“We don’t believe the current request before you provides the level of detail indicating the highest and best use of this property,” he said.

The WEDC wants the applicant to enter into discussions for a master redevelopment agreement for the entire site, he said. Having a master redevelopment agreement is the best way to move the project forward, he believes.

Former Mayor Carol Marinovich called it “very premature,” and said she opposed it, since there wasn’t a development agreement nor an impact study of its effect on current businesses.

She favored stipulations that required development agreement, a public hearing, and gaming contingent on a certain number of races held each year.

She said she recalled that when the UG lobbied for Village West, Kansas legislators insisted on seeing all the details before they would vote on it, and she hoped the UG now will want to see all the details before they make a decision.

The UG has worked to ensure high-quality development in the past, she said. “We need to ensure that this continues in our community with any future development,” she said.

A representative of an organization that opposes greyhound racing, Grey2KUSA, also appeared before the Planning Commission to ask to limit the permit and not include dog racing, now or for the future.

Rick Skinner, vice president and general manager of Hollywood Casino, said the casino was required to have a development agreement with the UG as a condition of its licensure. He asked the commission to oppose the Woodlands special use permit, but if the UG goes ahead with it, he said it’s very important to have stipulations on the permit to make the community whole.

‘Golden factors’ of zoning

But Beeler kept reminding the Planning Commission that they were there only to consider the special use permit, not a development agreement or any charitable donations The Woodlands might give the community.

The Planning Commission is supposed to consider only the “Golden factors” of zoning, named for a Kansas Supreme Court case in 1978 out of Overland Park. The local government can only consider eight factors: the character of the neighborhood; the zoning and uses of properties nearby; the suitability of the project for the uses to which it has been restricted; the extent to which removal of the restrictions will detrimentally affect nearby property; the length of time the subject property has remained vacant as zoned; the gain to the public health, safety and welfare by the possible diminution in value of the developer’s property as compared to the hardship imposed on the individual landowners; the recommendations of a permanent or professional planning staff; and the conformance of the requested change to the city’s master or comprehensive plan.

Curt Petersen, a lawyer with Polsinelli, said Kansas Entertainment wanted fair treatment and the UG should consider the public welfare. Requirements on the Hollywood Casino are all grounded in the public welfare, he said.

He then presented sample stipulations for The Woodlands on traffic, stormwater, lighting and noise, development agreement, prevailing wage, and other items.

Woodlands’ attorney responds: Everything was previously discussed and approved in 1980s

Planning Commissioner Daniel Serda pointed out a number of people had said they felt the preliminary development plan was ambiguous.

Beeler said before opening, The Woodlands would submit an application for a final plan review for the facility, and then the details would be gone over.

He said it was The Woodlands’ intent to race horses, and they had no present intention of racing dogs there.

Beeler also said they were trying to keep the site plans as close to the former Woodlands’ plans as possible.

While some people said The Woodlands didn’t have a site plan, Beeler disagreed and said it was the same site plan the facility had in the 1980s. Everything is in the same place, and the facility will be improved to become modern-day.

He said all the criteria had already been discussed and approved in the 1980s.

He showed a “Concepts for Development” slide that said the plan was three items: “Minimum development investment of $70 million; Current proposal of 2% gross gaming revenue paid to the U.G. and City; Anticipated additional taxes, with 34% mill levied taxes going to Piper School District.”

The investment amount was the only optional part of the slide, as the other two items were required by the current gaming law and current property tax regulations.

While Beeler said the statutes do not require The Woodlands to have a development agreement, he said The Woodlands would be open to discussions about it if they received the special use permit.

Planning Commission members challenged the notion that everything would be the same. There would be 750 slot machines at The Woodlands, and that would have an effect on traffic, according to the Planning Commission members.

Also, in the past The Woodlands closed each night around 10 p.m. or so, and now it would become a 24-7 operation, with the potential to have an effect on nearby residential neighborhoods, according to Planning Commission members.

Beeler said there was no opposition to the 24-7 hours in the neighborhood meetings that were held.

When the Hollywood Casino was selected, several casinos were competing against one another for the casino, and the UG was able to work out a development agreement. Beeler said that development agreement came after the permit.

Stipulations

Rob Richardson, planning director, said he would recommend some new stipulations.

• They include a provision that would make the special use permit run concurrently with horse racing and electronic gaming, and would expire if not used for 18 months.
• The permit would not include greyhound racing, and the applicant would have to come back for approval if they wanted to add it.
• The maximum number of electronic gaming machines would be 750.
• There would be a minimum 60-day horse racing season, with a 15 percent variance if the statute changes.
• There would be more than 85,000 square feet in the remodeled facility.
• All improvements would be made by private funding, including off-site public improvements necessary for traffic.
• If there is a need for a traffic signal, The Woodlands would have to install it.
• Comply with previous odor, lighting and noise systems unless the UG modifies it.
• The operator should request an inspection by the planning staff to make sure there is compliance with stipulations prior to opening.
• There will be a minimum of $70 million of improvements including the purchase and renovations.
• It is a 24-hour operation with racino concept, a special use permit for pari-mutuel racing.
• It will comply with all codes of the UG.
• The permit will not go into effect until the state license is issued.

As to the residents’ concerns about spreading the funding among other school districts, and the development agreement, Richardson said these concerns could be addressed by state legislation as it is being negotiated, or if the state legislation required a development agreement with the local government. There will be a public hearing and a plan review process later, Richardson said.

Planning Commissioner Eric Gonzalez asked for one more stipulation. He asked for a timeline for the project. After conferring with Beeler, Richardson said by June 30, the year following approval by the Legislature, provided that approval was in 2016 or 2017, if not, the permit would not go into effect.

Earlier stipulations outlined in the planning staff report included: Prior to opening, the applicant must apply for and receive approval of a final plan review detailing the renovations and plans; if a traffic signal is warranted, the applicant should pay all costs of it; occupation tax and licenses need to be applied for and renewed; if any grading work is done, an erosion control plan is needed; and a tornado warning siren is needed.

Richardson recommended approval of The Woodlands’ zoning with all stipulations, including the new ones mentioned at the meeting.

Voting to approve the permit with stipulations were James Connelly, Timothy DeWitt, Jim Ernst, Eric Gonzalez, Karen Jones, Susannah Pauley, Jim Schwartzman and Chris Wing. Voting against it were Jeff Carson and Daniel Serda.

After more than four hours, the crowd, which arrived at 6:30 p.m., was able to leave around 11:15 p.m. after the vote. About two hours had been spent discussing the topic.

After the vote, Kindle remarked that a development agreement would have cleared up questions such as what will be done with the dog racing building at The Woodlands. The proposal contains a plan to renovate the horse racing building. Would the dog racing building be remodeled or would it be allowed to continue to deteriorate, he wondered.