Memorandum
City of Lawrence
City Manager’s Office
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TO: |
Thomas M. Markus, City Manager |
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CC: |
Casey Toomay, Assistant City Manager Diane Stoddard, Assistant City Manager |
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FROM: |
Britt Crum-Cano, Economic Development Coordinator |
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DATE: |
June 30, 2016 |
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RE: |
Analytical Request for Public Assistance: 820-826 Pennsylvania Street |
Overview of Project
Williams Management, LLC, a Kansas limited liability company (property owner) is proposing the redevelopment of the historic building located at 820-826 Pennsylvania Street into a multi-level, mixed use commercial and residential development (see attached request and project graphics).
Built in 1905, the building was originally a two story seed warehouse (Kansas Seed House F. Barteldes & Company) until a significant fire damaged the building and the second story was removed (specific date unknown by staff). Since then, the building has been modified for a variety of uses and now exists as a one story building in disrepair.
Redevelopment plans call for commercial space on the first floor to accommodate an in-house brewery and restaurant. Second and third floors will consist of rental residential units, 15% of which will be permanently dedicated to affordable housing. The property owner plans to partner with a local non-profit organization for managing compliance of those units with affordable housing requirements.
According to the Planning Department, existing zoning is appropriate for the proposed use and the project has received HRC approval with the applicant’s agreement to work with the Historic Resources Administrator on the final building materials.[1] The project will require a Major Site Plan. [2]
Analysis Request
The property owner has met with City staff and indicates the project, as proposed, will require economic development assistance in the form of an IRB for a sales tax exemption on construction materials and equipment, and an NRA tax rebate at a percentage greater than 50%. Therefore, the owner is asking the City Commission to allow staff to perform a gap analysis to determine the level of assistance the project would require.
Incentive Policy Revisions
The City is currently in the process of revising economic development policies. Part of the proposed policy revisions includes having staff conduct analysis at the 10 year, 50% rebate level for NRAs unless directed otherwise by the City Commission. Based on previous direction from the City Commission, Staff will not run analysis on packages exceeding the 50%, 10 year NRA rebate level, unless directed otherwise by the City Commission.
To date, the City Commission has referred potential policy revisions to the Joint Economic Development Council (JEDC), the Public Incentives Review Committee (PIRC), and County for review and recommendations. PIRC considered policy changes on May 17, 2016. It was decided that non-elected PIRC representatives would meet publically and make recommendations on specific policy changes by August 1, 2016. The County considered policy revisions on May 18, 2016. In addition, the Affordable Housing Advisory Board considered policy revisions related to affordable housing on June 6, 2016.
As discussions are still taking place, the City Commission has not yet been presented with recommendations regarding economic development policy changes.
Recommended Action
The City Manager recommends that this project be referred to City Staff for cost-benefit and gap analysis and then sent to the Public Incentives Review Committee for review and recommendation, recognizing that the developer request for IRBs and an NRA may exceed the City Commission’s 50%, 10-year incentive limitation.