Bank, landowners stuck with $3.5 million bill for Basehor Town Center benefit district
Four years after the creation of a benefit district for a downtown Basehor development that never materialized, a Johnson County bank and several local landowners will bear more than $3.5 million in costs.
The Basehor City Council on Monday approved, 4-0, assessments for 2008 improvements to Basehor Boulevard and 155th Street. Facing a September deadline to issue bonds and pay off the city’s debt on the project, the council approved the assessments over the protests of Leawood-based CrossFirst Bank and several landowners on the west side of 155th Street who believed they would not be responsible for the improvements, which stretched to the east.
The council approved a benefit district in 2008 to construct Basehor Boulevard and conduct improvements along 155th Street, in anticipation of a new Basehor-Linwood school building and a multimillion-dollar proposed Basehor Town Center development. The school, Basehor Intermediate School, was built at the end of the road, but Basehor Town Center’s developer went bankrupt before it materialized.
Member Ty Garver said the council’s hands were tied.
“To me, it is unfortunate all the way around,” Garver said.
Attorney Jay Shadwick spoke on behalf of CrossFirst Bank, which took control of 84 acres in the benefit district after the developer sunk. The bank’s share of the roughly $3.5 million in assessments is about $2.3 million, which it can pay in entirety up front or over 20 years with interest as a property tax assessment.
He told council members that the bank had tried for two years to sell the property with no success, and the property would have no hope of developing if it’s saddled with that extra cost.
“This is a horribly unfortunate thing,” Shadwick said. “This is an assessment that really doesn’t quite benefit anybody.”
Shadwick asked the council to wait on approving the assessments in order to come up with some incentives for the property’s development.
Also pleading for a change were several landowners from the west side of 155th Street. Their properties were required by state law to be part of the benefit district because of proximity, bond attorney Gina Riekhof said. In 2008, council members told them that the Basehor Town Center developer had agreed to pay for their portions of the assessment, because they would receive little benefit.
But when the developer went under, that nullified that agreement, Riekhof said, sticking those property owners with the cost.
One of those owners, John Bonee, said it was unfair for them to bear a cost to which they never agreed, and the council should force the bank to pay as the developer previously agreed.
“It just seems to be like a runaway train here,” Bonee said.
Council member Brian Healy was absent from Monday’s meeting. Also during the meeting:
• As part of the consent agenda, approved 4-0, the council granted a payment of about $16,000 to former city administrator Mark Loughry for accrued paid time off.
The payment brought Loughry’s total severance up to just more than $50,000 — the same amount ordered by former Mayor Terry Hill last fall before the council voted to void the payment. The council later voted to provide Loughry a $34,000 severance payment, and former member Dennis Mertz asked City Attorney Shannon Marcano to look into whether Loughry should be paid for vacation time even though he was terminated.
Loughry was present at Monday’s meeting — the first time he’d been at a City Council meeting since his firing last September — but he did not speak.
• The council agreed, 4-0, to waive a $500 permit fee for a fireworks stand to be operated by the Basehor-Linwood High School marching band as a fundraiser.
Dakota Snyder, a senior trumpet player in the marching band, and Taylor Miller, a senior drum major, both spoke at the meeting to request the waiver. They said the proceeds would go toward uniforms, travel expenses and equipment.
• The council approved, 4-0, a resolution removing caps on the city’s contributions to employee health, dental and vision insurance. The vote reversed a council decision from summer 2011.
Martley said the change would likely affect the city’s budget only in 2013, as the city’s health benefits in subsequent years will be subject to the health care reform law, requiring a re-evaluation anyway.
• The council approved, 4-0, an agreement with the Kansas City, Mo., law firm White, Goss, Bowers, March, Schulte & Weisenfels for Marcano to continue to serve as city attorney. The city will pay White Goss a monthly retainer of $3,000 plus $175 per hour if services stretch past 25 hours in any given month.
• And the council approved, 4-0, the appointment of Tracey Hannah to the Basehor Planning Commission.