Airport plaza developers seek CID extension

When Airport Plaza was in its planning stages for the land northeast of West Bypass and Kearney Street, its developers hadn’t envisioned 30 acres occupied by a call center and an apartment complex. Instead, Airport Plaza Development Group LLC was hoping retailers would purchase lots on its 65 acres, allowing it to recoup roughly $2.8 million in infrastructure costs incurred through a 1 percent sales tax within a Community Improvement District created in 2005.

According to Joe Corn, board president of the Airport Plaza Community Improvement District, revenues from the tax aren’t coming in as quickly as hoped. The developers asked for a 25-year extension at City Council’s Aug. 9 meeting. The current CID is scheduled to expire in 2030.

“The scope of our development changed considerably,” said Corn, whose wife’s family – the Gotts – developed the property with partners. “Our first two lot sales … were T-Mobile and the lots for the apartments.”

The $20 million, 77,000-square-foot call center opened in May 2006 and brought more than 600 jobs to the area, while TLC Properties’ $45 million Orchard Park Apartments added 656 rental units. Both projects, Corn said, are good for the area, but the nature of those businesses means they aren’t collecting sales taxes.

“We still owe a considerable amount of money on our construction loan for that infrastructure,” Corn said. “At the present rate, the CID is paying about $48,000 a year, or $4,000 a month. That doesn’t pay our construction loan.”

Airport Plaza Development Group recently negotiated a 10-year amortization loan with First National Bank, Corn said, and monthly payments increased to $9,800 from $4,000. When the original loan was issued, most construction loans allowed borrowers to pay down interest in monthly payments and pay on principal after a lot sold. Since lots aren’t selling as quickly, banks are now asking for borrowers to pay interest and principal in higher monthly payments, he said.

Corn said the loan is considered “on demand,” and the bank can call it due at any time.
An extended CID, which would expire by 2055 or when the infrastructure costs are fully reimbursed, would give Airport Plaza Development Group more leverage in negotiating its bank loans, Corn said.

Current businesses in Airport Plaza that collect sales taxes include a Wendy’s restaurant and a Kum & Go. Six lots, about one acre each, are still for sale, he said. According to a listing by Murney & Associates Realtors agent Galen Pellham, lot prices range between $3 and $5 per square foot. A 1.5-acre lot fronting Kearney, for instance, is listed for $329,000.
Council members will vote on the Airport Plaza CID extension in two weeks.

Fire Department code
The Springfield Fire Department wants to change the way it inspects tankers delivering fuel within the city limits, and it’s asking City Council members to approve a change to the city’s fire prevention code.

Springfield Fire Department Chief David Hall outlined the change at an Aug. 9 council meeting, noting the request was prompted by concerns that the current method, which requires tankers to obtain a permit and city-performed inspection each year, has been found to violate state statutes. Instead of requiring a permit and annual inspection, he said,
Springfield’s fire department would inspect fuel tankers through random inspections while the tankers are unloading.

The department is still deciding on how the inspections would work, Hall said.[[In-content Ad]]