City Beat: Council OK’s tax agreement for Southern Hills Shopping Center

Brandon Jenson: Transportation project agreement is “legally dubious.”

Erick Roberts: Expanded use of landfill biogas is an exciting prospect for the city.

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Though the measure passed, the propriety of an ordinance to approve a transportation project agreement for the Southern Hills Shopping Center was questioned by two Springfield City Council members at the governmental body’s meeting June 26.

The council bill sought to forge a transportation project agreement between the city, the Southern Hills Shopping Center Transportation Development District, Southern Hills Investment Trust LLC and Southern Hills Plaza LLC.

In June 2022, Southern Hills Investment Trust LLC filed a petition to establish a transportation development district to pay for $2.9 million in infrastructure improvements to the shopping center property along East Sunshine Street. The project agreement allows a 1-cent retail sales tax to be applied by businesses in the district for up to 40 years.

In previous Springfield Business Journal reporting, David O’Reilly, a co-owner of Southern Hills Investment Trust, said he had been encouraged by city staff to petition for a TDD instead of the more common community improvement district.

The bill approved by council vests the city as the local transportation authority to approve the project. A staff explanation of the bill states the revenue will fund various parking lot improvements, including connections to public roads, stormwater improvements, construction of sidewalks and pedestrian pathways, construction of new driveways and parking lots, and work like grading, signage, landscaping and striping.

City Manager Jason Gage clarified the project’s public property improvements amounted to less than 5% of the value of the project. Amanda Ohlensehlen, the city’s director of Economic Vitality, said those public improvements comprise landscaping and some sidewalk work.

Councilmember Brandon Jenson noted a developer on greenfield property would be required to bear the costs of a parking lot. He also pointed out that the statute allowing TDDs provides for transfer of ownership of the project to the city as transportation authority, but this project gives the city no ownership of the project.

Jenson said he supports redevelopment to improve public corridors, and the Southern Hills Shopping Center desperately needs the help.

“But I can’t support a project that is as legally dubious as the one that is before us tonight,” he said.

Councilmember Craig Hosmer also raised objections. He said the state’s TDD statute has an exhaustive definition of what projects are authorized.

“It says bridge, street, roadway, highway access, road interchange, signage, signalization, parking lot, bus stop station, garage terminal, hangar – nowhere does it mention sidewalks, does it?” he said. “And it doesn’t ever say anything about landscaping.”

Hosmer added that the project is not even a transportation project.

“I think we’re trying to again drive a square peg into a round hole to give somebody taxpayer dollars,” he said.

Council approved the project by a 5-3 vote, with Jenson and Hosmer joined by Monica Horton in voting against it. Councilmember Derek Lee was absent.

Landfill energy project
Expansion of biogas recovery is proposed for the city’s Noble Hill Landfill, and bonds to pay for the project will be voted upon at the July 10 council meeting.

Council heard first reading of a bill that would allow the issuance of $13 million in special obligation bonds through the Missouri Environmental Improvement and Energy Resource Authority to improve the biogas recovery system at the landfill. This would be added to $3 million in reserves to cover the cost of the project.

The project is required for the landfill to maintain compliance with the Clean Air Act, according to Erick Roberts, the city’s assistant director of Environmental Services.

Work would in clude installation of 103 vertical gas extraction wells and connection of the new wells to the existing gas collection network. The project would include controlled combustion of the greenhouse gas methane and would produce renewable electricity for the city.

A low bid of $9.3 million from SCS Field Services was received, with a 20% contingency that would bring the project to $11.2 million.

“This is an exciting project,” Roberts said in an interview before the meeting. “We’re excited to be able to see this project come out of the ground, and we’re excited about studying the potential beneficial uses of gas going forward, not only to maintain regulatory compliance, but also to potentially be able to expand the beneficial uses of biogas across the city for our customers.”

Roberts said the landfill already is producing producing 3 megawatts of energy, enough capacity to power 2,000-2,500 homes. He added that initially, energy production will be the same, but over time there is potential for it to yield double or more.

The base load energy is renewable and available at all times, unlike wind or solar energy, which can be slowed by weather conditions.

He noted biogas emissions from the landfill can be cleaned to the point that it becomes pipeline quality and can be injected into the natural gas pipeline for any natural gas use, including in homes. Heavy equipment also can run on biogas, and the city’s fleet already includes a few natural gas vehicles.

Other action items

• To clear the way for the Sunshine Towne Center commercial development, which may include a Target store, council approved a rezoning of 22 acres on Sunshine Street in west Springfield to highway commercial from mostly general commercial. Council also voted to annex some 9 acres of private property into the city for the project.
• Council OK’d the rezoning of 402 acres above Springfield Underground for surface development ranging from multifamily housing to general retail and heavy manufacturing. Federal and state grants to improve LeCompte Road and Eastgate Avenue have helped open the mostly undeveloped land to new uses, officials say.
• The city’s lodging tax was expanded to levy the tax of 5% of gross receipts on short-term rentals, like Airbnb, in addition to hotels, motels and tourist courts. The measure is expected to bring in $3 million in its first year, to be split in part among the Springfield Convention & Visitors Bureau Inc. (47% of tax proceeds), the Springfield Regional Arts Council Inc. (4.5%) and the Greater Springfield Area Sports Commission Inc. (4.5%).
• The former Boyd Elementary property was declared blighted and its redevelopment plan approved with a tax abatement. The Boyd School Redevelopment Corp. plans to transform the former school into an apartment building in the Midtown neighborhood.
• A rezoning measure will allow Good Samaritan Boys Ranch to accept and store donations of furniture and other home goods for youth transitioning from foster care into adulthood and their first homes. The rezoning changes 0.85 acres at 504 E. Norton Road to medium-density multifamily residential from single-family residential. The property to be rezoned is adjacent to the organization’s existing transitional service shelter.
• Council made way for a Boys & Girls Club of Springfield Inc. teen center on Grant Avenue Parkway near Parkview High School. The corridor’s redevelopment plan, commissioned by the city, requires buildings in that portion of the corridor to be three stories, but this council action allows a variance for a single-story building – specifically, a gymnasium – with a minimum height of 35 feet. The measure also allows a nonprofit community center.
• A Rountree Urban Conservation District plan was approved. It specifies intensity of use, building and lot standards, materials, parking standards, buffer yards and signage for the district and expands its boundaries to the north and east.
• A conditional use permit was approved to allow a self-storage facility by Bibi Investments & Development LLC at 1706 S. Zimmer Ave.