Focus Area: Economy
Staff Contact: Jamie Robichaud / Kate Messer
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Report on a request by Scannell Properties #476, LLC, and assigns for an issuance request for a master resolution for industrial revenue bonds and tax phase-in for the construction of a business park. The project will entail approximately two buildings totaling 683,800 sq ft on a total of 43.54 acres located on the northwest quadrant of Clare Road and W 159th Street.
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recommended motion:
Accept report. A resolution regarding the project is scheduled for the June 2nd City Council Meeting.
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Summary:
The City has received a master resolution application for $88,674,100 in industrial revenue bonds for the construction of 683,800 square feet total in warehouse and distribution facilities. The project is located on approximately 43.54 acres at the northwest corner of Clare Road and W 159th Street. This will be a multi-series of bonds to be issued to cover land and the building costs for each phase of the project.
The City has received an application under a master resolution (Scannell #476) for a single series application for industrial revenue bonds for the construction of and industrial facility in a business park setting. The request is for $55,000,000 in industrial revenue bonds for the construction of 646,380 million square feet of space on 32.47 acres. This will be a multi-series of bonds to be issued to cover land, and the building costs. This development is located near the NWQ of 159th Street and Clare Road.
The Applicant requests a 10-year / 80% property tax phase-in in conjunction with the issuance of the City’s industrial revenue bonds for all phases of the development. This project is applying under the City’s tax abatement policy (Policy F-5, Resolution 25-1099). Additionally, this project lies in the newly established zone allowing for increased abatement percentages.
The first project under the master resolution has requested bond not to exceed $55 million for a 646,380 square foot industrial building on a 32.47-acre parcel. The single series request of industrial revenue bonds consist of:
o $3,900,000 to acquire land
o $51,100,000 to construct the building
• The project will create 461 new jobs over the next 10 years.
o Average salaries of the new jobs:
§ $48,000 in year one, growing to $74,464 in year ten
o A total of approximately $297.9 million in new wages in year 10 of the abatement
• Property taxes over the 10-year period with estimated 80% property tax phase-in on the project (excludes 8 mills for school district):
o All jurisdictions = $174,000 annually / $1,740,000 10-year total
o Olathe = $38,750 annually / $387,500 10-year total
o Olathe’s current annual property tax revenue from the property is $6,936
o Upon retirement of the tax phase-in, the City will receive approximately a total of $193,750 in annual property tax revenue once the property tax phase-in expires.
The cost-benefit ratio of this project for the City is .87 with payback expected to take more than 10 years.
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Financial Information:
See attached materials for more detailed fiscal impact information.
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Attachment(s):
A. Application
B. Resolution No. 26-XXXX