Archive for Thursday, February 17, 2005

Village West financing defended

Unified Government mayor, former lieutenant governor question audit

February 17, 2005

— From inside one of the businesses she contends gives her community "a sense of pride," Unified Government of Wyandotte County Mayor Carol Marinovich ardently defended her administration's practices in luring tenants to the Village West tourism and entertainment district.

"We did exactly what the Kansas Legislature wanted - promote economic development," Marinovich said, adding, "Who can say we did anything other than that?"

The comments Wednesday at the Great Wolf Lodge came in response to findings of a legislative post audit, released earlier that day in Topeka, that called into question some of the county's practices in using STAR bonds to develop Village West and the Kansas Speedway.

The STAR, or sales tax revenue, bond program provides Kansas municipalities the opportunity to issue bonds to finance the development of major commercial entertainment and tourism areas and to use sales tax revenue generated by the development to pay off the bonds.

According to the audit, "no one can argue that the Kansas Speedway and Village West redevelopment projects haven't been enormously successful at bringing significant development to western Wyandotte County." But, "this success doesn't mean that good judgment, decision making and oversight shouldn't be exercised to ensure that STAR bond monies are spent wisely, reasonably and only for the purpose allowed and intended."

The audit cited several Unified Government missteps in using the STAR bonds, including:

¢ Billing $450,000 in fees when it issued bonds for the Speedway and Village West projects. The state authorized the bonds for economic development, but in this case the fees "represent an unnecessary transfer of money from the state to the Unified Government."

¢ Spending $28 million for expenses that go beyond what the legislators envisioned when they passed Village West legislation. The price tag includes $15 million for wildlife exhibits within Cabela's, plans to spend $8.5 million for robotic dinosaurs for a theme restaurant and using STAR bond money to pay consultants hired by businesses locating within Village West.

The report was also critical of excessive fees charged by developers and controversial charges by some of the principal merchants, including Cabela's and Nebraska Furniture Mart.

Unified Government officials said they complied completely in using the bonds reasonably for Village West, a major economic development coup for Wyandotte County. Approximately 11 million people visit Village West properties per year.

Marinovich, who arrived at the press conference from a meeting in Florida to recruit the NASCAR Hall of Fame to Wyandotte County, said the audit's review was politically motivated and contrary to the common good of her community.

"There are critics, but many of them : have an agenda, and it's political," Marinovich said. "The success of the Village West and Kansas Speedway is an indictment of the failed good ol' boy structure of Wyandotte County."

Former Kansas Lt. Gov. Gary Sherrer, who reviewed development of Village West at the state level, also defended Unified Government's practices. Sherrer said Unified Government lived up to its obligations.

"They never told me anything they didn't do," Sherrer said. "I think it is a tragedy that we're acting like something bad occurred here."

Though involved in the development of Village West while lieutenant governor, Sherrer said those conducting the audit did not consult him.


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