Council approves plans for new benefit district
The Basehor City Council has decided there will be a benefit district in Basehor Town Center after all.
Council members approved, 4-1, with Keith Sifford opposed, a benefit district petition for improvements to Basehor Boulevard water and sewer lines Monday night. The Council also approved the benefit district petition, 3-2, with Sifford and Terry Hill opposed, for 155th Street improvements. Both petitions were brought to the Council by the Basehor-Linwood School District.
An almost-identical proposal brought to the Council by Affinity Development, the developer of the Basehor Town Center project, was denied in May. Council members were worried about the risk the city would face by taking on general obligation bonds as well as the effect the bonds would have on the city's debt limit.
"At the last meeting, there were questions about our debt limit and how this petition affects our debt limit," City Administrator Carl Slaugh said.
Estimated assessed property valuation in Basehor on July 1, 2008, was about $41.5 million, Slaugh said. The debt limit is set by a statute at 30 percent, which would be a little more than $12 million. The city's current debt stands at about $4.5 million. Certain improvements such as storm and sewer projects do not count against the limit, making the city's debt with the additional benefit districts rise to slightly under $7.5 million - well under the $12 million mark.
"I think the important issue the Council is weighing is, is this a project worth supporting?" Slaugh said. "If we use it for this project, we still have some capacity for issuing debt if some major project comes up. Will this benefit this city as a whole?"
School district officials were pushing the idea of a benefit district - especially for Basehor Boulevard - because of the need to start construction on the planned new elementary school within the Basehor Town Center development, which is scheduled to be open for the 2009-2010 school year. The district needs the road and waterlines established before construction can begin. The location for the school was selected based on its location in close proximity to the center of the city and the fact that the Mussett family donated the land to the district.
"We selected a site that we thought was ideal for a new school," Superintendent Bob Albers said. "It was in the middle of a development that was getting approved by the Planning Commission and the City Council every step of the way and we thought this is what the city wants. It doesn't put the city at any great risk, the city doesn't pay for it and at the same time it allows us to build that infrastructure and put a new school in the heart of Basehor."
Gary Anderson with the bond counsel from Gilmore and Bell explained that the risk to the city was in fact low. The developer is responsible for paying back the bonds until infrastructure in the area is built up and enough property owners have moved in to cover the payments. If the developer defaults because of bankruptcy or any other circumstances, the city may then have to take over the payments, however, four things must happen first.
"The developer has to walk away, the bank has to refuse to foreclose and take ownership, the property has to fail to sell on the courthouse steps and the land has to be worth less than the outstanding indebtedness," Anderson said. "There are hundreds of benefit districts in the state of Kansas and there is only one that I know of that has experienced total meltdown."
Albers said that, if needed, design fees for the school could possibly transfer to another site, but site costs such as surveying and drilling at more than $50,000 could not be recouped. Plus, the district would have to think about the cost of land since the original site was donated. A project such as a school, Albers said, would be a the boost for development Basehor Town Center needs.
"This would be a signature project to spur development in the center of Basehor," he said.
In other action Monday night, the Council:
¢ Approved, 5-0, a proclamation declaring July 26, 2008 as Shrine Bowl Day in the State of Kansas and recognition of all-star Swede Johnson of Basehor-Linwood High participating in the 35th Annual Shrine Bowl Football Game in Emporia.
¢ Approved, 5-0, an application for property tax abatement through the Neighborhood Revitalization Plan for The Medicine Store.
¢ Approved, 4-1, with Iris Dysart opposed, an application to the Kansas Water Pollution Control Revolving Loan Fund for the Waste Water Treatment Facility expansion project.
¢ Approved, 5-0, a drainage repair proposal for property located at 15399 Meadow St., David Brown.
¢ Approved, 4-1, with Sifford opposed, continued funding support for Leavenworth County Development Corporation (LCDC) for fiscal year 2009.
¢ Approved, 3-2, with Hill and Roger McDowell opposed, setting a public hearing date of Sept. 8, for the annexation of Cedar Lakes subdivision. Location of the public hearing will be announced at a later date.
¢ Approved, 5-0, moving forward with action on old VFW Building 2805 N. 155th. The Council has given the property owner 30 days to commence demolition.
¢ Approved, 5-0, a pavement management proposal from MHS Engineers.
¢ Approved the appointments of John Matthews and Kevin Jones to the Planning Commission.
¢ Approved, 5-0, setting a public hearing date of Aug. 4, for the 2009 city of Basehor budget.
¢ Met in executive session for 10 minutes to discuss attorney-client privilege and non-elected personnel.