City Beat: Council approves incentive package for Andy’s home

Brandon Jenson: City is in a race to the bottom in terms of offering eco devo incentives.

Craig Hosmer: Policy change of extended drive-thru dispensary hours deserves more attention.

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Construction of a new headquarters for Andy’s Frozen Custard was given the green light by Springfield City Council on July 27 after it approved an incentive package for the project.

With the decision at its July 27 meeting, council approved the issuance of $32 million in Chapter 100 industrial development bonds that will allow the local company to build its new home in northeast Springfield. Andy’s has been in leased space in downtown Springfield since 2016, according to past Springfield Business Journal reporting. CEO Andy Kuntz has previously said the company is outgrowing its current 18,000-square-foot headquarters at 211 E. Water St.

By Andy’s utilizing the bond proposal, the city would take ownership of the 10-acre property the company previously purchased at the corner of East Division Street and North LeCompte Road for the 25 years of the agreement. That allows the company to take advantage of the city’s tax-exempt status to build 43,200 square feet of office space to be spread among three buildings, plus a 9,600-square-foot industrial warehouse.

Through the deal, Andy’s would receive about $4.4 million in property tax abatement and sales and use tax exemptions over the 25-year agreement.

The real and personal property tax abatement will be incremental, with 90% abated on the improved value in the first 10 years. The percentage moves to 75% for years 11-15, 60% for years 16-20 and goes down to 50% abated in the last five years of the 25-year span.

Chapter 100 of the Revised Statutes of Missouri allows local governments to issue bonds to provide property tax abatement for industrial development projects and certain types of commercial development for private corporations, partnerships and individuals, according to past reporting.

The vote, which was not unanimous, came after multiple amendments to the bill failed to gain majority support from council. The bill for the industrial development project passed 7-2, with Councilmembers Brandon Jenson and Bruce Adib-Yazdi voting in opposition.

Amendments proposed
Jenson and Adib-Yazdi proposed changes to the package prior to the final vote at the July 27 meeting that were unsuccessful.

An amendment proposed by Adib-Yazdi sought to require the general contractor to solicit bids from local subcontractors and seek a goal of 50% local labor participation for construction.

“I’m asking us to just simply track the locations and the ZIP codes of the people that are working on the job sites,” Adib-Yazdi said. “Should be relatively painless. I know that general contractor will have to do some more paperwork and some more tracking in order to do this.”

Councilmember Heather Hardinger said she supports the idea of tracking local labor participation in big projects but wants the city to look into it as more of a policy approach versus tracking a one-time project such as with Andy’s. Council voted down the amendment 5-4 with Adib-Yazdi, Monica Horton, Craig Hosmer and Jenson in support.

After Adib-Yazdi’s amendment failed, Jenson followed with a motion to postpone a vote on the bond proposal until the council’s Sept. 21 meeting to allow city staff time to negotiate an incentive package that would keep Andy’s headquarters downtown.

Amanda Ohlensehlen, the city’s director of workforce and economic vitality, said staff had previously visited with Andy’s officials about staying downtown.

“The footprint that they have is a 10-acre site,” she said of Andy’s land purchase at Division and LeCompte. “It is really difficult to find contiguous sites within downtown that would be able to accommodate that and also be consistent with the comprehensive plan and the downtown plan.”

The new headquarters project by Andy’s would maintain 54 jobs and add another 16 – figures CEO Andy Kuntz previously told SBJ were conservative, with more hires anticipated. The new jobs would have an annual starting wage of $94,766.

“I think we need to consider whether the opportunity cost of $4.4 million in tax revenue is worth the creation of less than 20 new jobs,” Jenson said.

Jenson was the lone vote in support of his amendment, which was defeated 8-1.

Jenson’s second motion was to amend the development plan to limit property tax abatement to 50% over a 10-year period. He said that is in line with the city’s Economic Development Incentives Policy Manual, which indicates that Chapter 100 tax exemptions will typically be granted at 50% for 10 years. He further noted that the manual says the city will not extend its sales tax exemption for purchases unless council finds there to be “an extraordinary public benefit.”

“But, like most economic development nowadays, we are engaging in a race to the bottom in terms of incentives and giving away tax dollars to fund really critical needs that we have here in the city,” Jenson said. “And we don’t even have another competitor at the starting line.”

The amendment failed by a 6-3 vote, with only Adib-Yazdi, Jenson and Hosmer in support.

The Andy’s construction project is expected to be completed in two phases, starting with the first two office buildings to be built in 2028. That will be followed by the third office building and the industrial warehouse building, estimated to be complete by 2033, according to officials.

The Chapter 100 incentive has been used elsewhere in the city of Springfield. According to past SBJ reporting, developer Opus Northwest LLC in 2009 negotiated $21.5 million in Chapter 100 bonds to construct what would become the Forvis Mazars building at 910 E. St. Louis St., with 100% abatement for the first 10 years and 50% abatement for the next 15.

Council has also approved Chapter 100 bonds three times for expansions of production lines at Kraft Heinz, with up to $26 million OK’d in 2012, $36 million in 2016 and $48 million in 2020, according to past reporting.

Cannabis to committee
By a narrow vote, council approved that a request by the owners of a local marijuana dispensary to operate its drive-thru facility until 1:30 a.m. be referred to the city’s Plans & Policies Committee. Hosmer made the motion for the referral. The bill’s applicant, V3 MO Vending 5 LLC, owner of Terrabis at 850 E. Kearney St., is seeking to extend hours for drive-thru windows at dispensaries in Springfield from the current 10 p.m. closure time.

Hosmer said he thinks it’s best that the applicant, which received approval for its proposal by the city’s Planning & Zoning Commission in June, go through the committee process to determine a request that would be a public policy change.

“It’s a policy change that deserves more attention rather than just the applicant saying, ‘I want to do this for monetary reasons.’ We need to understand what the impact on the city of Springfield is going to be,” Hosmer said.

Mayor Jeff Schrag asked Hosmer why the issue going through the Planning & Zoning Commission wasn’t a sufficient vetting process.

“Well, Planning & Zoning isn’t charged with the responsibility of making public policy for the city of Springfield,” Hosmer said. “We are. That’s our job.”

Hosmer said he’s not critical of the committee process, adding it “ultimately leads to better policy because you’re doing things thoughtfully instead of fast.”

While the proposed change to dispensary drive-thru hours was made by a single applicant, Justin Crighton, the city’s assistant director of planning and development, said at the council’s July 13 meeting that the city has removed a provision allowing an applicant to propose an amendment to the zoning code. He said this bill marks the last such measure to be considered by that mechanism.

The committee referral was approved 5-4, with Hosmer joined in support by Councilmembers Adib-Yazdi, Horton, Derek Lee and Abe McGull. The Plans & Policies Committee’s next meeting is scheduled for Aug. 18, according to the city’s website.

Soccer interest
Council will consider a bill at its Aug. 10 meeting to terminate the cost-share agreement but extend the letter of intent with United Soccer Leagues LLC for a future possible soccer stadium. The bill, if passed, would extend the letter of intent through Dec. 31, 2027, with an option for two additional six-month extensions, said Ohlensehlen. It would also allow the city to directly manage any remaining due diligence with previously budgeted funds.

“No additional appropriation is being requested with this,” Ohlensehlen said, noting council authorized staff in late 2024 to work with USL to evaluate bringing professional soccer to Springfield. “We actually have not been asked to reimburse anything. So, the existing $75,000 that was appropriated would be utilized for that additional due diligence work.”

USL and the city are analyzing the potential for a stadium at 1109 E. Trafficway St., an 8.9-acre site that currently serves as the gateway to Jordan Valley Park. The site is located on the east side of Route 66 Stadium, home of the Springfield Cardinals baseball team.

Initial geotechnical investigations and site surveys indicate that the property can accommodate a venue of this scale, Ohlensehlen said.

“However, because of the property’s former uses, additional environmental engineering and site planning work is needed before any final configurations, cost estimates or development recommendations can be presented,” she said.

The property was a limestone quarry from approximately 1900 to 1963 and later a landfill for construction and demolition debris, according to past reporting. It is also the site where the city buried its diseased Dutch elm trees in the 1960s.

Ohlensehlen said Springfield remains a high priority market for USL because of the city’s growing soccer community, its competitiveness as a region and the alignment with the potential for catalytic downtown investment.

Other action items

• A request to rezone 1 acre of property at 2852 W. Republic Road to general commercial district from county C-2 was approved. Applicant B&B Rental & Real Estate LP intends to build a drive-thru coffee shop.

• Council accepted a rezoning request of 130 acres at 233 E. Norton Road by Maranatha Village Inc. to government and institutional district from county R-1, suburban residence district, single-family residential district and planned development No. 165. The applicant intends to infill and expand the senior living development Maranatha Village to the north and east.

• An amendment of roughly $83,560 for the Springfield Fire Department’s fiscal 2026-27 budget was approved. The ordinance appropriates fund balances from the department’s community room, public education and hazardous materials funds. 

• Council OK’d the selection of Mauldin & Jenkins LLC as the city’s independent auditor and authorized City Manager David Cameron to execute a contact for independent auditing services for the city for fiscal years 2026-2030.

• Council authorized a $100,000 grant renewal from the Missouri Children’s Trust Fund for the Springfield-Greene County Health Department to continue operating the Family Connects program, which offers no-cost home visits to parents of newborns in Greene County. 

• Council approved an ordinance that requires taxicabs operated in the city to be inspected biennially, on years where no state vehicle inspection is required. City staff previously told council the structure would ensure each taxicab was inspected by the city or state each year.