City planners face pushback from urban developers over water rules

The corner of Pershing Street and South Avenue downtown is a hulking mass of pure city that stormwater bounces off and runs over. The former Great Southern Bank office building sits in a sea of concrete and asphalt.

The property is 1.5 acres of vertical offices and parking spaces built in 1938, some 45 years before the first set of water-detention and water-quality rules were established in Springfield.

These days, the property could represent a focal point in a developing debate between the need for updated water-code rules and urban redevelopment downtown.

During Springfield Business Journal’s CEO Roundtable on local real estate last month, commercial property manager Mike Fusek of Sperry Van Ness/Rankin Co. said new water-detention rules could be problematic.

“Water will kill a lot of deals,” said Fusek, who is listing the Great Southern Bank building downtown. “That whole project is concrete and asphalt. The city wants water detention and green space, and now you just lost half of your building site. If someone does not get ahead of this with Springfield, their desire for water quality will reduce significantly the number of redevelopment sites for potential users.”

On the topic, commercial broker and developer Brad Thessing added: “You go from a site that is 100 percent usable, to not being usable at all. The negotiations then greatly reduce the value of the property when you go to sell or develop it.”  

Potential uses of the property matter because the city of Springfield is considering new water-detention and water-quality rules to encourage more green space and less flooding on low ground. But the development community says the proposed changes could be too costly and discourage new investments in areas in need of fresh starts.

Derek Lee of Springfield-based Lee Engineering and Associates LLC said additional regulation is likely to increase the cost to redevelop in the city. That’s because requiring developers to install water detention in areas already covered by concrete – or pony up to a payment in lieu of taxes – reduces their usable property and/or adds new expenses to project pro formas.

“It will be harder to develop under the new rules,” Lee said. “Currently, if you develop downtown or in an area that’s already impervious, you don’t have to provide detention for the entire lot. You just have to provide for the new impervious.”

Chris Dunnaway, the principal engineer in Springfield’s stormwater management office, said under current codes developers adding impervious surfaces such as concrete also have to mitigate the stormwater runoff to the degree that they are putting additional pressure on the city’s stormwater infrastructure. Generally speaking, more concrete means more water retention is required on development property.

The city last updated its water rules for new projects in the mid-1990s.

While many details are still in flux, Dunnaway said adding a detention requirement for redevelopment is among the regulatory refinements being considered. He said other notable adjustments on the table include: revising the stream buffer criteria; changing the method for determining water-quality volume; requiring certification of water-quality plans; offering new options for meeting water-quality requirements such as roof gardens; and modifying code related to properties with sinkholes.

Owned by G&S Holdings LLC, Fusek declined to address follow-up questions about the Great Southern Bank property for this story. Great Southern spokeswoman Diane Zipf could not be reached for additional comments about the site by press time. Springfield Interim Economic Development Director Sarah Kerner said there hadn’t been any requests for economic development incentives on the property.

Farmers Park developer and sustainability advocate Matt O’Reilly of Green Circle Projects LLC said the new rules actually could hurt the environment by discouraging center city redevelopment.

“A redevelopment project is essentially the best type of environmental project,” said O’Reilly, who served on the Strategic Planning Committee for the city’s Field Guide 2030 long-range planning initiative.

When developers invest in urban areas, they reduce urban sprawl by putting people and businesses where development already has occurred, he said, which also supports the tax base. O’Reilly believes a holistic approach to regulations is needed – one that weighs the social, environmental and economic impacts. Cities naturally have a negative impact on the environment and redevelopment can minimize that footprint.

“We buried Jordan Creek. Let’s not pretend. It is what it is,” he said of the stream that runs underground in parts of downtown, a casualty of modern progress.

Dunnaway said city of Springfield engineers have hosted five meetings with local development groups between December and February to receive feedback on the potential changes. Stakeholders in attendance represented groups including the Missouri Society of Professional Engineers, City Utilities of Springfield, the James River Basin Partnership, the Development Input Issues Group and the Springfield Contractors Association.   
 
In the coming weeks, Dunnaway and city engineers would like to meet Springfield City Council members during a weekly luncheon to get them up to speed. Dunnaway said staff would continue to review feedback from the development community over the next couple of months, evaluate examples to assess the impacts of potential changes and make adjustments where necessary. Late summer or fall is the target date to present any new regulations to council.

“We’re not looking to kill redevelopment,” he said.

Bruce Adib-Yazdi, director of design and construction for The Vecino Group, is familiar with downtown construction. The company’s local project list includes redevelopment efforts in the heart of Springfield totaling roughly $40 million for the former McDaniel, Woodruff and Landmark buildings.

Adib-Yazdi didn’t know enough about potential code changes to say just how those projects might have been impacted. However, in general, he said the company regularly deals with water-quality and quantity issues as part of the construction process.

With Vecino Group’s downtown Springfield projects, he said there really was no way to add water detention where the buildings already existed, but payment in lieu of taxes wouldn’t have necessarily shelved their plans.

“It depends on the magnitude of the costs,” he said. “We do work in other states where impact fees can be in the six-figures sometimes. A $100,000 fee on a $10 million is 1 percent. Could we make a 1 percent adjustment on a $10 million project? I’m guessing we could.

“Now if it was 10 percent, that might discourage it.”