CITY OF SHAWNEE
FINANCE AND ADMINISTRATION COMMITTEE MEETING
MINUTES
JULY 5, 2011
7:00 PM
Chairperson Distler called the meeting to order at 7:00 p.m.
Committee Members Present
Councilmember Neighbor
Councilmember Morris
Councilmember Distler
Committee Members Absent
Councilmember Kuhn
Other Councilmembers Present
Councilmember Sawyer
Councilmember Vaught
Councilmember Sandifer
Staff Present
City Manager Gonzales
Assistant City Manager Charlesworth
Assistant to the City Manger Killen
Finance Director Kidney
Senior Accountant Oldham
Fire Chief Hudson
Deputy Fire Chief Mattox
Information Technology Director Doherty
Deputy Parks and Recreation Director Lecuru
Human Resource Coordinator Dawald
Police Chief Larimore
Police Captain Tennis
City Clerk Campbell
Members of the public who spoke: ROD HOUCK, LINDA LEEPER, Shawnee City of Commerce.
1.
FINAL BUDGET REVIEW.
Chairperson Distler stated that over the past two months five budget meetings have been held.
Staff will give a wrap-up presentation and make recommendations for the 2011 Revised/2012
Budget.
Due to software malfunction meeting audio started at 7:11 p.m.
City Manager Gonzales stated finally, there are market adjustments for the specific positions.
She stated they rolled through those at the last meeting. There are 168 people who will actually
be getting raises and around 108-115 who will not.
Councilmember Morris said City Manager Gonzales put some numbers to most of these, but
there are no numbers to the spray injection patching machines.
City Manager Gonzales stated the staff budgeted $70,000. She stated the City of Manhattan did
a similar bid recently and got it for $56,000, so it will depend on the bids.
Councilmember Morris asked for market adjustment projected costs.
City Manager Gonzales replied it is at about $405,900 at this time. She thinks they have around
$20,000 to $25,000 plugged in for volunteers.
Councilmember Pflumm asked how the staff determines who gets raises.
City Manager Gonzales replied it was based on that market study they went over at the last
meeting.
Councilmember Pflumm stated he did not see anyone on the lower level, or anyone at ‘this level’
would not get a raise. He asked where they determine the bar.
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City Manager Gonzales replied it was all position based. They looked at positions that were
below the minutes and positions they hire for frequently and those that cost a lot to train and
uniform. They also have to look at compression issues. They just gave raises to the Police
Officer 1’s to get them up to the minimum and have new hire folks making as much as four year
officers, so they scaled it back. It was based on all that market information.
City Manager Gonzales continued with the Public Safety Equipment Replacement Fund. She did
not go through them line by line, but gave the big picture. She stated this is the fund they will
need to really focus on next year – how they will adequately replace their public safety vehicles.
City Manager Gonzales stated Special Narcotics is the fund they never really know how much
revenue they will receive from and are able to use it for drug related equipment.
City Manager Gonzales stated the Special Highway Fund show the transfers in and out. She
stated the transfers in are on the revenue side. They can see the big transfer to Debt Service to
the gas tax money.
City Manager Gonzales stated the Special Parks and Recreation Fund are the alcohol funds.
She stated they keep moving forward with their Shawnee Town projects and continue to make
$150,000 of debt payments each year out of that fund into the Debt Service Fund.
Councilmember Neighbor asked when Pioneer Crossing is set to be paid off.
City Manager Gonzales stated it probably has 10 more years, but Stump is closer to being paid
off.
City Manager Gonzales stated they are adding a school resource officer. Their portion of the
salary will be paid out of this fund and the school pays part of the cost as well. That is the other
half time at Hocker, because they are doubling the number of kids at that school.
City Manager Gonzales stated the additional officer will use their spare time to use some of the
apartment and community policing things they have let go in the past, so it is a good example of
building back some capacity.
City Manager Gonzales stated some of the match for the officer comes from Shawnee Mission.
She stated the staff plans to bring both those contracts to the Council on a future agenda, but
some of that match comes from the DeSoto School District.
City Manager Gonzales continued with Park and Land Use. She said this is the money the City
receives on fees on building permits and revenues. She stated they have no planned
expenditures out of that budget for 2012. She stated Pioneer Crossing is 2021 and Stump is
2016.
City Manager Gonzales stated there is a small increase for the CVB. She noted the allocations
for Shawnee Days and Wonderscope and said the remainder is a transfer to the General Fund.
City Manager Gonzales stated Parks and Pipes is mostly the Clear Creek Trail. She stated in
2012, there are some improvements to the dam at Erfurt Park on the lake which fits into this fund.
This was a match to a much bigger federal allocation and Phase III takes the trail down to the Mill
Creek Trail.
City Manager Gonzales continued with storm water and the projects scheduled the rest of this
year and for 2012. She stated all of them are SMAC projects. They are leveraging their funds
with the SMAC program, which is a great thing.
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City Manager Gonzales stated the cemetery fund has nothing new or different. She stated the
Storm water Utility Fund includes some capital and some operations. They have built up the fund
balance over the past few years because it was not initially staffed. In 2011, there is still some
residual they will try to do some CIP projects with and in the long term, the number will go down
even farther.
City Manager Gonzales stated the Public Safety Sales Tax is the debt on the Justice Center and
Fire Station No. 72.
City Manager Gonzales stated the Neighborhood Revitalization Program is the fund where the
10% from the NRA program comes into and they also make an allocation out of the General
Fund. This year, it is $18,000. Some of that 10% is now being used to fund the grants, which is
a unique investment cycle.
City Manager Gonzales stated the Equipment Facility Reserve Fund is not a zero based budget
and certainly the intent of this fund is to equally fund on an annual basis, so when there are
spikes and expenditures they can save up and fund towards those. She stated they have not
quite gotten there, but the actual budgets will be the $965,000 and $200,000 in 2012. The
expenditures related will not necessarily match up to the budgeted amounts year by year, as they
are spending more in some years and less in others.
City Manager Gonzales stated the Debt Service Fund show the big debt payment. They paid out
loans they still have and the debt payment on Silverheel North – most of it will be funded by
special assessments back into the fund.
Councilmember Morris asked about the Equipment and Facilities Reserve Fund and because
there are some in with Police and Fire in different areas – it gets back to not painting him a clear
picture on how much the City is spending on all equipment replacement and repair, but broken up
into two little departments.
City Manager Gonzales replied there are two main funds. She stated the Police and Fire and
Public Safety Equipment Fund – everyone else is in this fund and the exception is if there is
something out of storm water utility, they might buy it out of that, because that fund has a funding
source into itself. Primarily, these two are where they replace major replacement. Repair is back
in Operations in the General Fund.
Councilmember Morris asked for the total of all three funds.
City Manager Gonzales stated Councilmember Morris had asked for a bigger picture. She
presented a summary of revenues by fund. She stated the Council all knows and understands
what each of these funds do and where the revenues come from. They have talked about each
of them and why the revenues are at the levels they are at.
City Manager Gonzales presented total revenues by fund, including transfers. She presented
revenues by source. She noted the revenue differences and said they are headed in the right
direction and not going down anymore.
Councilmember Pflumm stated they have about $3.6 million in there in 2011 for the franchise fee.
City Manager Gonzales stated that is correct and shows in the Taxes line item.
Councilmember Pflumm stated it would be interesting to see what 2009 showed in that same
format without the franchise fee.
Councilmember Pflumm asked if they are running at about $3.6 million in 2011.
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City Manager Gonzales stated total franchise revenue in 2009 was $2.083 million. She stated
actual 2010 was $2.868 million and budget 2011 was $4.696 million, so there is about $1.92
million attributable to the increase or other factors that might affect that franchise number.
Councilmember Pflumm asked if they were estimating $3.6 million.
City Manager Gonzales presented total budget numbers on expenditures. She stated those
include transfers, so when they net the transfers they should think about actual budgeted
expenditures and there is a substantial difference in those.
Councilmember Morris asked about looking at revenues and expenditures by fund. He stated if
they take 2010 in actual revenues and actual expenditures, by what he has received, they do
have more revenues than expenditures.
City Manager Gonzales stated they do in 2010. She stated as they get forward to 2011R and
2012, they need to remember they are planning to spend from reserves, so their expenditures will
exceed revenues because of those planned capital investments out of the reserves.
Councilmember Morris asked if they are spending more money in expenditures and basically
keeping the same amount of revenue coming in.
City Manager Gonzales stated it is fairly stable.
Councilmember Morris asked if it is because they are spending more reserves that they are going
to have more expenditures at the same amount of revenue.
City Manager Gonzales stated that is correct.
City Manager Gonzales presented the big spreadsheet that combines things. She noted this is
just the General Fund and then presented 2011R expenditures, so in 2011R they will have more
expenditures than revenue budgeted, but may not end the year that way. She stated they ended
with a good fund balance in 2010. If they do not spend as much as they budget in any of the
funds, specifically in the General Fund, then they will not have to make that full transfer of the
$500,000 and some of it will come out of operating revenue. They really will not see that until
after the end of this year.
Councilmember Morris asked if it was because they were deciding to spend reserves for some
priorities and not that they are just, in general, spending more than they have.
City Manager Gonzales answered absolutely – yes. She stated the General Fund budget, but for,
those one time capital expenditures is a structurally balanced budget. She still believes they
have more needs for those capital investments, so while she will say it is balanced – revenues
exceed expenditures, but for those other investment things. Going forward, they still need to fit in
the streets and are in a lot better place than they were.
City Manager Gonzales stated back in 2005, 2006, and 2007, they were spending fund balance
on operations and are no longer doing that.
City Manager Gonzales stated because transfers are pulled out of one fund they are counted as
an expense, and then their revenue is something else. That is why they net them out in those
other charts to show actual budgeted expenditures. She stated in the General Fund in 2011R
they have $300,000 in the Facility Equipment Reserve Fund, $765,000 are the roofs which is a
transfer from the General Fund to the Utility Reserve Fund. She stated $1.2 million is the transfer
for the street maintenance program.
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City Manager Gonzales stated they set up a special fund for the signal lights. That transfer is
coming from the General Fund. She stated they transfer a certain amount each year out of Storm
water Utility to go towards the street maintenance program, specifically curbs and gutters. They
transfer from the Special Highway Fund to the Debt Service Fund to make debt payments. They
transfer from the General Fund into the storm water utility fund to help fund those operations –
the crews who are actually doing the maintenance of the storm water system.
City Manager Gonzales stated this helped her put everything in place to show what funds are
going where and for what purpose.
Councilmember Morris asked in general, the General Fund transfers into these other funds are
coming out of the reserves.
City Manager Gonzales answered no, not necessarily. She stated some are. She stated of the
$450,000 of the storm water utility – that is a transfer that they have made as they established
that utility as a place to account for storm water. She stated they used to bear a lot more of that
cost in the General Fund. They did not just want to zero it out, because the storm water utility did
not have enough revenue source to support the whole program. The $450,000 is part of the
operations budget.
Councilmember Morris stated in general, he is trying to get his head around how much they are
using in reserves to go into the General Fund.
City Manager Gonzales stated these are changes, so there was an amount originally budgeted
for street maintenance and these are the General Fund transfers that are coming out of reserves,
or they think will come out.
Councilmember Morris asked if the amounts shown are all about that.
City Manager Gonzales answered yes. She stated when they created the 2011 budget last year
they were going to make a $750,000 transfer to the street maintenance program and of that, they
felt $518,000 was going to come out of reserves, so there was about $230,000 in the General
Fund and matched with expenditures and revenues; that was reserve expenditure in 2011R.
Councilmember Morris stated bottom line – with 2011R and 2012, they anticipate how much is
coming from reserves into the General Fund.
City Manager Gonzales explained that the reserves are in the General Fund, so they would be
going out of the General Fund into street maintenance or facilities and equipment. She stated
with the Debt Service Fund, they obviously do not have any reserves and with the Special
Revenue Funds, all of that revenue has to stay in those funds. She stated the General Fund is
really the only place they would have reserves to be used for other purposes.
Finance Director Kidney stated the whole definition of the Special Revenue Fund is for special
purposes. He stated the General Fund law is set up for any general purpose the Council deems
necessary and have the authority to make a transfer from a general operational fund into a
special revenue fund. That is generally where they will see these types of transfers.
City Manager Gonzales stated it is a lot of different pockets.
Councilmember Morris stated as he understands, the City has set up a goal of 30% reserve and
have a higher reserve right now. He asked if that reserve is now in the General Fund. He stated
that is the big pocket.
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City Manager Gonzales stated that is correct. They make one time investments and not fund
more operations, but make one time investments because once that money is spent, it is gone. It
needs to be in things that are going to last and not people or operations type of equipment.
Councilmember Neighbor stated they are proposing $16 million in the reserves at the end of the
year and started with $17.6 million.
City Manager Gonzales answered yes. She stated that is why they only spend their reserves
once.
Councilmember Pflumm stated he was under the impression all the different funds attributed to
their reserve fund to get to that 30% level.
City Manager Gonzales stated that is not correct.
City Manager Gonzales stated they carry a cash balance in those funds, but is not part of what
they calculate for that 30%. The idea of the reserves is to have enough extra in the operations
account, so if the world ended or they had a huge tornado like Joplin recently did, they would
have enough money to pay for people, trucks, gas, and electric – those kinds of things. The other
funds are not designed to have reserves, but do carry them forward.
City Manager Gonzales stated they try to keep enough of a balance in funds such as the
Convention and Visitors Fund, because those checks come quarterly and never want to run it into
the red. She stated transfers in 2012 are similar.
Councilmember Sawyer stated the reserve fund is inside the General Fund.
City Manager Gonzales stated it is not really a fund.
Councilmember Sawyer stated that is where their reserves are.
City Manager Gonzales stated that is correct.
Councilmember Sawyer stated when they talk about these transfers it is simply that they put out a
reserve where it will bring down their reserves. He thinks that may be the problem both he and
Councilmember Morris are having – trying to keep track of if they ‘do this item’, it will really bring
down their reserves. He does not think that is clear. He understands the street maintenance
thing.
City Manager Gonzales presented the three funds where they plan to hit the reserves and said
the rest are budgeted. She stated part of the General Fund, the street maintenance program,
some of that was in operations at about $250,000. She stated it is the same in 2012. She
presented the two they think will hit reserves.
City Manager Gonzales stated 2011R, the public safety and other equipment funds show
$813,914.00. She stated in 2012, it is $1,094,100.00.
City Manager Gonzales presented a different way to look at the picture. She stated 81% of the
City’s revenue was taxes, 3% in intergovernmental grants and programs, 2% fines – just a picture
of the total revenue. She stated total expenditures are $60 million and 44% is people, service
providers. 21% is for debt service and noted the other areas.
City Manager Gonzales stated her summary of this budget is they put together a budget that
approves cash funding, priority projects – all the projects in the special funds over the last three
years. They have gotten to the point where they are cash funded. She stated the General Fund
has operations expenses that are less than revenues.
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City Manager Gonzales stated this budget makes good decisions to not use some of their healthy
reserves, but not too much because they may need more next year, but to use some of them to
address these one time capital needs.
City Manager Gonzales stated looking to next year’s budget, they need to stay focused on their
assets; infrastructure, facilities, people, and equipment and make sure they build a budget that
fits those in. She stated with the Public Safety Equipment Fund, if they are going to use that fund
for a replacement program, which she thinks is a very good use of that fund, it does not have
enough revenue to fund replacement of the current fleet, so they need to figure that out. They
think they will be replacing the gap in the Debt Service Fund.
City Manager Gonzales stated it all depends on revenues and how they progress through the
year and how the year ends. They will continue the monitoring process. That concluded her
presentation.
Councilmember Morris stated this feels a little different than last year. He thinks the one area that
concerns him is long term. His concern is they do not, in the future, have problems. He knows
they are all trying to keep it balanced. He is still concerned about the City’s supplemental fund for
retirement and how it works. He thinks the approach right now will get them in trouble in the long
term.
City Manager Gonzales stated her response would be the money for the study. She stated
pension plans are not just something they just can stop. She stated a lot of thought went into
building that plan and a lot of thought went into funding it for many years. She stated they need
to do a good study to determine what to do with it. She stated the staff needs to look at the
numbers and pros and cons more and bring it back to the Council. She stated it is an IRS
approved benefit plan with a lot of legal obligations.
Councilmember Morris stated that is something he would like to further explore. He knows from
his own company that they are complex. He has some concerns about the $10,000 study on it,
but wants to do it right.
City Manager Gonzales stated that is a budgeted amount and they certainly want to make sure
they do it right.
Councilmember Neighbor stated having a defined pension plan and having it terminated, he can
guarantee it is very complex. He stated it took over four years to get resolved and still is
unresolved to this day. He applauds the idea of doing it the right way, as suggested by
Councilmember Morris, but they need all the answers to make a good decision.
Councilmember Neighbor applauded City Manager Gonzales, Finance Director Kidney, and all of
staff who have done a lot of work. He thinks there are several things they need to pay attention
to and unfortunately, as hard as they work here in Shawnee with the sales tax up a bit as well as
property values, they do not control their own destiny. He thinks they need to take care of their
credit rating, so they have the good earnings and are not spending more money on financing.
They need to take care of their people.
Councilmember Neighbor stated as they have talked here many times, they need to take care of
roads and public safety equipment. He stated after that, as far as spending is concerned,
particularly in 2012, he thinks this is a good and responsible budget, but he is still a newbie with
this. It seems they have dotted the I’s and crossed the T’s and is something they can live with.
Councilmember Neighbor stated he would caution everyone to pay very close attention to what is
going on 60 miles to the west of them in the State legislature and some of the ruminations of what
is going on up there. He stated if they turn around and pass next year to get rid of all the sales
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tax, that is 25% of the revenue for the state and will have huge repercussions on Shawnee
coming downhill.
Councilmember Neighbor stated Shawnee has one of the lowest mill levies throughout the state,
but that could all change next year. He stated they really need to keep their powder dry going
into 2012 and hopefully they can move forward with the same programs.
Councilmember Sawyer stated in years passed, and thinks they had it last year – they sent out to
the Councilmembers decision packages. He is missing those this year.
City Manager Gonzales stated they have not done decision packages for the past couple of
years. She stated the last two years, they did decision packages on what to cut.
Councilmember Sawyer stated this year they are putting in a few new items and he wants
everyone to understand. He thinks maybe he needs it spelled out to him. He would like to see
the changes spelled out and what it will actually cost the City. He still struggles with a million
bucks for economic development, and no one seems to be able to tell him what they are going to
do with it as long as it looks good. He is sorry, but took offense to the answers he received at last
week’s Council meeting.
Councilmember Sawyer stated he would like to see what some of these new items are. He wants
to know what they will cost the City.
City Manager Gonzales replied the budget software is about $25,000. The street light
maintenance was $40,000. The volunteer coordinator was $20,000 to $25,000.
Councilmember Sawyer stated there are other items. He asked about the extra money planned
to spend on the roofs. He agrees they need to do all of this, but need to know specifically if they
are spending “X” on this and that.
Councilmember Pflumm stated in the past, everything was laid out and emailed out to everyone
about what was going to happen and the staff made their recommendations.
City Manager Gonzales stated because they have gotten into such a different mode, the staff has
not approached it that way over the past three years. The past three years have been more
about reducing things. She sent out charts and asked for priorities on how to reduce things.
City Manager Gonzales stated the staff presented on all the new items and it was her intent to
provide background, the opportunity for discussion, disagreement, and questions. These are
items she placed in there based on the Council’s direction and input. She stated tonight is the
time to discuss these things.
Councilmember Pflumm stated he knows he was definitely not in favor of the volunteer
coordinator program as being a paid position. He does not think there is any reason they can’t
just start off right now with a volunteer in that position.
City Manager Gonzales stated at this point, that is a position of the Council. She stated her job is
to try and interpret what everyone is saying and plug it in here. She stated the final decision is a
vote, but if anyone has suggestions along the way or she hears a majority of the Council saying
one thing, such as the street lights, she realized there was a problem and is why she addressed it
and plugged it in, but if there are different thoughts and ideas, that is the time for the Council to
discus it amongst themselves and make a motion to take something out.
Councilmember Pflumm stated in 2011, they put another $500,000 in streets.
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City Manager Gonzales stated if Councilmember Pflumm has revenue he would like to put in
streets, that is what she wants to here.
Councilmember Pflumm stated he knows they have raised taxes a couple of times. He stated not
only did they not put that money for the franchise fee or property tax, where they raised taxes in
the past, towards streets, but it seems as if money has been taken away from the streets. He
stated they spend on $217,000 on curbs and they are horrible.
City Manager Gonzales stated the 3.6 mill for property tax is back in 2006. She stated three of
those mills were specifically for debt service, so there was no discussion for streets at that time.
She stated the $600,000 was to keep the General Fund whole. She stated with the franchise fee,
there was never any direction to put it all to streets.
Councilmember Pflumm stated not all to streets, as that is not what he is saying. He stated the
impact fee projected that they put almost all into economic development in 2012 . . .
City Manager Gonzales interjected by saying that is a decision by this Council.
Councilmember Pflumm stated they took two years of the impact fee and is for streets. He stated
much of the discussion on the impact fee was on streets and much of the first two years is goose
egg.
City Manager Gonzales stated she put it together and the Council needs to tell her what they
want to change.
Councilmember Morris stated the new things under General Fund items comes out to $580,900 –
approximately. That is not if they add in the streets. He stated he will only speak for himself, and
say it is not clear this year as to how this process works. He thinks one thing they should talk
about is the impact fee.
City Manager Gonzales stated all they need to talk about this evening is 2012, but they can not
legally do anything with 2013.
Councilmember Morris asked if they are comfortable with it all going to economic development.
He stated as a Council, they decide how that fund gets uses and it will not go all to the COC or
the SEDC and is up to the Council to give direction.
City Manager Gonzales stated it is in the City budget.
Councilmember Morris thinks it is important to have clear discussions on whether or not it is wise
to spend it all on the economic development portion, but it is not yet determined – that portion.
He stated it may go to build infrastructure, or promote something. He stated the Council guides
the staff on their direction.
Councilmember Sandifer stated his opinion on economic development in this City, is the problem
is they are not able to compete with other cities. He stated with this impact fee, they need to
have tool established for the staff and Council to track economic development more in this city.
They have been told there are areas that are basically undevelopable because of the financing. If
they could get sewers to that piece of property, or any others so people might be attracted to it –
the infrastructure runs them off.
Councilmember Sandifer stated this is the first time to set up this type of fund in Shawnee and
they should use it as a tool to attract. They should do everything they can in today’s economic
times to allow staff to have the tools to do it.
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Councilmember Vaught stated it was said if they want to move something out of this, they make a
motion. He stated he is not on this committee.
Councilmember Pflumm stated tonight they are having a discussion, but Councilmember Vaught
could make a motion at a Council meeting.
Councilmember Vaught stated this goes back to their discussion about having a budget
committee and anyone can make a motion when these types of things come up. He is stuck this
evening because he is not on this committee.
City Manager Gonzales stated that may be contributing to her really just trying to gather some
kind of consensus.
Councilmember Vaught stated he would like to have a budget committee which would allow every
councilmember to make motions at any given meeting. It could run the same night and vote
someone in to run the budget meeting and they step down and the Committee Chair steps up for
the next meeting.
Councilmember Morris asked Councilmember Vaught if he is talking about doing this just at
budget time.
Councilmember Vaught answered yes. He stated this is a good example. He can’t make a
motion tonight. Now is really the time. It is nice to get these types of things out of the way to get
away from 6 hour Council meetings.
Councilmember Vaught stated he wants to look at the City’s cost with the pension plan and do a
benefit comparison and go back to when this plan started and compare it to different scenarios.
He stated they could do a 20 year snapshot.
Councilmember Vaught stated with regard to the patch machine, if the Council approves this
budget, does it mean they do not vote independently on those items so the patch machine would
be part of it.
City Manager Gonzales answered no. She stated anything over $50,000 absolutely comes
before the Council and the individual expenditures. There would be a bid process.
Councilmember Vaught stated if the patching machine is not approved, maybe that will be money
spent. He asked about the volunteer coordinator position.
City Manager Gonzales stated they always discuss new positions during the budget process, no
matter the cost. With regard to the pension plan cost analysis, that is within her scope at $10,000
and not something the Council would see until the study was complete.
Councilmember Vaught thinks what they have is really a difference in wards and they are all
representing the people who put them on the Council. He stated in his ward, when he
campaigned, did not hear a lot about roads because Ward III has a lot better road conditions than
Ward I, II, and IV – in places. He heard about economic development over and over.
Councilmember Vaught stated Shawnee not only has better roads, but they also have a higher
combined mill levy because they are in the DeSoto School District. He stated that school district
absolutely suffers from commercial development. He stated Perimeter Park is not in the DeSoto
School District, but in Olathe’s district. If they take that out of the equation, what commercial
development is there in the DeSoto School District – there is what is in DeSoto which is not in
abundance and a little development.
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Councilmember Vaught stated the taxes in the DeSoto School District are higher and will
absolutely take economic development to offset that and their roads are in better condition. It is
more important for his constituents to spend money on economic development, if they can make
something happen, particularly at 43rd and K-7. After past discussions, he has heard that is really
where they have their eye on for this money.
Councilmember Vaught stated if things never come together for that and the City has a chunk of
money sitting in that fund and talk about fixing a road and do it, they could vote to do it and does
not have to go to economic development, but is in an economic development fund. If they are
ever going to really stem economic development in that area, it will take serious incentives
because of the mill levy.
Councilmember Vaught stated they can make the commercial development happen on 43rd
Street if they bring in the right developer. From his position, economic development is important
and he represents the people of his ward. To him, economic development is more important than
roads, because their roads are in better shape than in other wards.
Chairperson Distler stated she completely understands and agrees with Councilmember Vaught,
but in her ward it is a different situation. She was milling through everything and heard someone
say they need to put the money towards the roads first. Over the past couple of weeks she has
received three emails from residents in her ward who have very damaged roads and they want
them fixed. She is not opposed to the impact fee funding going towards economic development,
but in her mind the way it is going, versus 100%, 0%, working its way up to 50/50, she would be
going the other way.
Chairperson Distler stated they should fix the roads, because that is as important to economic
development as buying cups that says Good Starts Here and handing them out at conventions to
get people to Shawnee. She stated the developer is going to look at the roads, more so than the
plastic cup they receive.
Chairperson Distler stated because she understands Councilmember Vaught’s point, she is not
opposed to even getting to 50/50, but starting at 73rd – get the funds started. She stated reality
always precedes potentiality. She stated the reality is the City’s roads are suffering and need
help. The potentiality is they may get economic development from this fund. She is not a
gambler.
Chairperson Distler stated the Mayor has been saying every year since she has sat on the
Council about the roads – the mill and the overlay, so that is where she is at on this. She stated if
they create a special fund for economic development, will they not be able to use that money for
economic development later because with all the other special funds, that funding has to go to
what they say it is going to.
City Manager Gonzales responded by saying, it is like the Special Highway Fund and the Council
approved to transfer $1.7 million into Debt Service, because that it what they need it for. She
stated some of the revenue sources are more specifically bound by a State statute. She stated
the impact money is city money. The impacts defined are streets and economic development.
She stated as logic they should use the money for those things, but is at the discretion of this
Council to make a decision or change their mind on a decision. They may do that from year to
year after the budget process. They want to give a consistent message, but annually with this
budget process the Council has the opportunity to change the amounts.
Councilmember Pflumm stated the City definitely needs economic development and he has been
a big promoter on economic development for quite some time, but the fact is they have neglected
their streets and now they are to receive an impact fee that is supposed to go towards streets and
none of it does. He is a little upset about it.
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Councilmember Pflumm stated he would agree with Councilmember Sawyer, in that if someone
comes to the City of Shawnee or their economic development people goes out and sells a Best
Buy into the old Price Chopper down on Shawnee Mission Parkway, they can take that, evaluate,
and decide if they need to spend money on the facility, streets, or curbs and apply money
towards that and see what they are getting in return.
Councilmember Pflumm stated it is an investment, but they have no idea if they can get someone
out of there. They still need to fund that economic development for long term, more long term
than short term, but also need to take some of the money from the impact fee and put it towards
streets.
Councilmember Neighbor stated last week he had the opportunity to go with Mr. Nave down to El
Dorado to the Kansas Calvary, which will now be Team Kansas. It is a bunch of private people
who do economic development for the State of Kansas. The State of Kansas exports over $30
billion worth of goods and services, not counting aviation over the year.
Councilmember Neighbor stated there was a person from Shawnee, who after being in the
running was awarded the Exporter of the Year for the State of Kansas. He stated Biomedtronics
are here in Shawnee and only have 31 people. They want more ground and will have everyone
in the world come after them, be it from Lenexa or Olathe, which are giving away free ground. He
stated Topeka just gave away the ground for the candy factory and the State had some money to
throw in. He understands the chicken and the egg, but Shawnee needs to do something to get
on the map as far as economic development is concerned.
Councilmember Neighbor stated Mr. Nave has been involved in this group and is a very sharp
man. Some place in here, they are going to have to take a step and start developing some of the
ground sitting out there, at least to get in some development for this city. He stated otherwise,
they are going to sit here at 26% commercial development and all the rest is going to be personal
property taxes and who knows what will happen with the City’s taxes and mill levies, depending
on what happens with the State.
Chairperson Distler stated on the same token, they have several buildings sitting open that could
easily be redeveloped where there are already sewers going to.
Councilmember Neighbor stated those buildings are sort of dinosaurs because of their size. He
is sure if there is a way to figure it out, it might be best to tear them down. They have leases.
Chairperson Distler stated if someone is going to come here and look at leveling and building on
vacant ground, it would be much easier to level and build on the ground they have sitting empty
with the sewers already in place.
Councilmember Vaught stated based on what Councilmember Neighbor just said, they need to
understand what true economic development is. He stated filling an empty retail space is not
economic development, but a broker doing his job. He stated economic development is truly
bringing new tax dollars, primarily property tax dollars, to the tax base. While a new tenant in a
retail center brings the City sales tax dollars, they are already collecting property tax dollars off
that existing property even while it is sitting empty. The economic development has already
occurred – so leasing space is not economic development.
Councilmember Vaught stated they constantly say they like to mix economic development with
filling big boxes. He stated their job as a Council is not to fill big boxes. He stated he owns
property and would love if the City actually participated in leasing his property. It would be great.
He stated as the owner of the property it is the broker who lists it and is their job and not the
City’s job and is not economic development. That economic development already developed and
is already paying taxes.
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Councilmember Vaught stated they are going to have an opportunity on 43 rd Street coming up. If
they take that money and while it would be great to spend it on roads, but if they could find a
master developer and there is a chunk of money where they could say they will apply it to roads
and infrastructure, if they will come in and build a half a million square feet of spec space, then it
is economic development and goes on the tax rolls. Even if it is abated, they do not give 100%
abatement and will still get money and bring in people and jobs and it starts the process.
Councilmember Vaught stated it goes back to reinvestment. They could spend it on roads and
there are roads that need it, but the City does have a Mill and Overlay Program and a road
program. They have been working towards that program and have not totally abandoned their
roads and are back on track to get things done and have a schedule.
Councilmember Vaught stated if they spend the money on roads, the money is then gone and the
road is fixed and will not have money for economic development. New structures out of the
ground generate new revenue back to the city and it takes money to make money. That is the
bottom line with development. If they want to generate additional revenue, they invest in
economic development to generate that revenue.
Councilmember Vaught stated Deffenbaugh probably has a bigger impact on the exit off I-435
which is the road the State maintains, because that is the road he drives every day that is
hammered and the State is supposed to maintain. It has had a major economic impact on I-435
for commercial development. It has not developed.
Councilmember Vaught stated back to what Councilmember Sawyer said, he was a little harsh on
him at the last meeting and apologizes for that, but if Andrew brings them a project they will see
the return, especially on industrial development. He stated they have this dollar amount they are
going spend it is not a hard dollar amount to figure out as it is there. On the retail end, based on
demographics it will produce ‘this much’ property and sales tax. Those are easy numbers to
bring to the City.
Councilmember Vaught stated going backwards and looking at development is tough, because
they do not know what the total economic impact of a project was to go back and look at it and
ask for the return to the city. They have to invest.
Chairperson Distler asked about property taxes, is it by the square footage or by the value of the
property sitting on the property. She stated her property tax on her home is based on what they
value her home and not on the value of the land it sits on. She stated someone can have a
$50,000 home on an acre, or they can have a $500,000 home on an acre.
Councilmember Vaught stated someone pays taxes on both the improvements and the land. He
stated the tax bill shows the value of the land and the value of the improvement.
Chairperson Distler stated to clarify then, if someone were to come in and knock down an existing
structure and build it up to something of more value, it would have a higher property value.
Councilmember Vaught answered yes, if they could get someone to do that.
Chairperson Distler stated she does not want to argue, but theoretically it would increase.
Councilmember Vaught stated it depends on what they build, but it is cheaper to build on raw
ground than to demolish because demolition costs are huge. He stated if someone moved into
the Price Chopper and they collect sales tax, the City would only get sales tax.
Chairperson Distler stated she is saying if someone redeveloped the property, it would increase
the value.
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Councilmember Vaught stated if 75th and Quivira got leveled into something of a higher dollar
value it would produce more, but they can only look at a spread between the two. He stated if it
went on the tax rolls and produced the City $300,000 in property tax, but the other was producing
$275,000, that is only a $25,000 increase.
Chairperson Distler stated they can’t say there would be no increase.
Councilmember Vaught stated he has no problem with redevelopment and is all for it. He stated
if someone said they will develop 75th and Quivira, but can’t afford the demolition costs and he
could put a deal to go with the owner and the City put money towards demolition, that is the idea,
but would ask if that would be good for everyone and answered yes, because the City would like
to see something happen with that – that’s redevelopment. He stated while it would be removing
something and someone developed something that works that would be fine.
Councilmember Pflumm stated he does believe it is economic development, because anything
they do to increase their tax revenue base, whether it is sales or property tax is economic
development. If they have four box stores sitting vacant at this time that are at zero sales tax and
get someone in there who is producing hundreds of thousands of dollars of sales tax, that is
economic development and that money can go towards other economic development. He stated
Councilmember Vaught had a lot of good points, but neglected on the sales tax issue of that one.
Councilmember Morris stated he strongly feels they need as much as they can towards economic
development. He thinks they are at a point to where they have two items that need to be put on
the fast track; true economic development and infrastructure, repair, and maintenance.
Councilmember Morris asked if they did in 2012 80% economic development and 20% helping
with street maintenance program and infrastructure, will that significantly impact, long term, how
the City approaches economic development to get it off the ground and make an impact. He
stated they will have 20% less impact, but asked what that means.
City Manager Gonzales stated in real dollars, the impact fee in 2012 shows going towards
programming. She stated 20% of $663,000 is $136,000 that could go towards streets and would
leave $500,000 for economic development.
Councilmember Morris stated in the scheme of things, $663,000 is not a ton of money to go to
economic development in the first place. He stated this Council has to come up with a decision.
City Manager Gonzales stated one concept they have discussed with several of the businesses
who have looked at the riverfront is doing a benefit district. The owners pay 100% of the cost of
the road, but the City finances it for them over 10 years. One way they could help create that
infrastructure is not with paying cash one time to build a road, but committing to be a 50% partner
with the developer and paying 50% so their cost is the 50% and the City’s cost is 50% over a 10
year period. She stated if they look at it that way, to where they could get a road built in 2012 and
use part of that money to commit to a 10 year benefit district, it would give the City a lot more
leverage.
City Manager Gonzales agreed with Councilmember Morris in that $663,000 is not a lot of money,
but in talking to the utility report that has been done, $500,000 will either get the water or sewer
there. She stated they do not have get the entire cost, but if they could step up and share some
of that cost, especially with the property owners there today who may be carrying that cost for a
while if development does not happen right away, because it won’t happen right away. She
stated that park is a 20 year plan and will take a long time to build out.
Councilmember Morris asked if they are saying they are going to put the $663,000 into economic
development and it is basically there to say they can use to help someone out.
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City Manager Gonzales stated that would be her thought. She stated if they know something is
coming, they could use that money for leverage with a private company.
Councilmember Morris stated having said that, is another $100,000 to tell them they are going to
leverage it and will it make that much of an impact with them, versus having physical
improvements to the streets for $100,000+ and still have $500,000 to leverage and partner with
someone. He asked if it will make much of a difference.
City Manager Gonzales stated that is one year, so there is no answer to that question. She
stated $130,000 for streets will do some things, but not a lot. She stated the City will still receive
calls. She thinks they have a good plan to get back in business and move forward over the next
five years for streets. Both of them are long term challenges. One of the huge benefits of this
economic development fund as she thought about it, as they have had conversations with people
and have talked about the fact the City may have a fund to do some leveraging, it piques people’s
interest. She stated just that, helps improve the City’s image in the business community, whether
it is $500,000 or $663,000. She can not tell them today what that money will be spent for and
wishes she could because it may make their decision easier.
City Manager Gonzales stated just in the time Andrew has been with the City has received four
good possibilities of tenants for the Hy-Vee on Quivira. He has worked with the owner, but none
have been able to make the dollars work. If there was something, they could use this money to
offset tenant finish costs, or do a buy-down on a loan program, as they did downtown and may
make the difference of filling up the space.
City Manager Gonzales stated she wishes she would give more specifics on the economic
development fund.
Councilmember Morris stated they are trying to build up this fund to really do some leverage.
City Manager Gonzales stated she would not say it that way. Her thought is they first of all
establish the fund and say which would be a stream of revenue coming in from that impact fee.
She stated in 2012, they would have some funding to use and would have an idea in 2013. She
stated with every budget session the Council goes through, they will approve the amount to go
into that fund. If there comes a time where the dollars needed to be lowered and leveraged, they
could put more into streets that year. She can tell them right now sitting with the riverfront and
with the study and interest they have had in it, she thinks that is why she would that 100% money
in 2012 and 2013, because she thinks it is absolutely critical to get that up and off the ground. It
doesn’t mean all of it will go towards that though.
Councilmember Morris thinks they are in a dilemma where they have two things equally important
and absolutely demand some funding and action. He would be flexible by a little, if the Council
felt there should be a little put into roads. He thinks they need to put as much into economic
development, so they can leverage it, but can flex a little.
City Manager Gonzales stated there is no magic to these numbers.
Councilmember Sawyer stated the first disappointing thing to him, was when the impact fee was
first talked about it was said they were going to be able to take care of their streets and then next
thing he hears they are going to spend some on economic development and now they are going
to spend half on economic development. He stated he does not want anyone to thing he is
against economic development, but everyone is missing the point here. He stated they are
putting a $1.3 million figure up there and are saying the economic development people that they
contract with, they normally give them $379,000, if he is correct on his figure.
City Manager Gonzales stated it is just less than $300,000.
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Councilmember Sawyer stated they are getting $663,000 out of this fund and are going to
transfer it, and that is all great. He stated they are all saying the Council is going to make that
decision, but he is not thinking that is the way it will happen. He asked if the developer out there
does not sit around and read these minutes. He stated they are sitting out there saying the City
has $663,000 and is not going to do anything until they get it. He stated most likely they will be
given abatements and could go all the way up to 80%. He stated then when they get this
economic development fee, it is free and their taxes are basically dead even at zero for 10 years.
Councilmember Sawyer stated everyone poo-poos him because he asked the question last week
that they need to think about the long term costs. He stated they are wrong if they think people
do not sit around and look at what they can get.
Councilmember Sawyer stated the $663,000 that they are going to sit aside for economic
development, they are not in control of that – that is up to the economic development . . .
City Manager Gonzales responded that is not correct.
Councilmember Sawyer asked why it is in that fund then.
City Manager Gonzales explained that is a fund that the Council may or may not choose to
create. She stated it is a fund of the city, just like the downtown fund.
Councilmember Sawyer asked about the $663,000.
City Manager Gonzales stated that is the City’s money.
Councilmember Sawyer asked why that money does not show up as a separate fund. He asked
why they add in that $300,000+ in there. He stated they are not in control of that money and is
up to economic development to decide it is a good project and what they are doing with it.
City Manager Gonzales stated that is not correct.
Councilmember Sawyer asked why it is in there.
City Manager Gonzales explained this is a fund of the City budget.
Councilmember Sawyer stated there is $1.3 million there. He stated now they are at $663,000 for
the impact fee. He asked for the rest of that fund.
City Manager Gonzales said currently in the 2011 budget, there is about $286,000 budgeted for
the contract that the Council approved with the benchmarks, performance measures, and
business plan contracted with the Chamber. They pay that right now out of the General Fund.
She stated right now, the City receives about $300,000 from Deffenbaugh in 2011 in the General
Fund. That is what they have received in the past. She stated this year the City is actually going
to get a little more because of the impact fee, but to her, those were a wash. She stated the
impact fee money will be used for economic development.
City Manager Gonzales stated her idea was to take both the revenue and the expense and put
them in a city fund for economic development, along with the rest of, or half of, the impact fee
money. She stated of the total impact fee for 2012, they have $300,000 plugged in for the
contract. The remaining amount $703,600 is what would be in the fund, or whatever number the
Council chooses to be governed by a policy statement that she has started to draft, but is looking
for advice and recommendations from the economic development board to bring back to the
Council to approve this policy statement that says the City of Shawnee have established this fund
and ‘these are the kinds of things they are going to use it for’.
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City Manager Gonzales stated this is just her verbiage and is not finished. She stated she is not
the be/all end all. She stated it would be used to support strategic initiatives of the Governing
Body like supporting the growth of existing corporate businesses and develop some sort of
program to support that initiative.
City Manager Gonzales stated all those expenditures for major grant and incentive programs
would come back through this Council, because that is City money. She stated the only part
being sent to the Chamber is the biannual amount they pay them for the contract that the Council
approved.
Councilmember Sawyer stated that is his point. He stated they should take out that $300,000
and that is what they contractually pay them every year to run their deal and get all this fantastic
development. He said that should be two separate lines.
City Manager Gonzales stated it is two separate lines.
Councilmember Sawyer stated they should not be lumping it in with the $1.3 million.
City Manager Gonzales stated they can move that back over the General Fund and move
$300,000 of it back and separate them. She stated it made sense to her that most of their
economic development stuff would be put into this fund, but it does not have to work that way.
Councilmember Sawyer stated in all fairness, this $663,000 is not going to buy a piece of ground.
He stated they sit around here and wring their hands and do not have the product because they
do not own the ground. It is not going to build a street.
Councilmember Sawyer stated they are most likely going to come to the City and ask what they
can do to help them. He does not believe the $663,000 is going to be the big answer to their
problems. Somewhere they are probably going to have to say yes, they can do this and bond this
and take care of ‘this’, meaning the City. He struggles, if he understands the figures, which they
are going to bond some street repair. He asked if that is correct.
City Manager Gonzales stated it is not in the 2012 budget.
Councilmember Sawyer stated they are talking about it for 2013.
City Manager Gonzales stated that is correct.
Councilmember Sawyer stated they have never done that since he has been involved in the
Council. He stated he is concerned about what this $700,000 is really going to be used for. He
does not want to see them go out and run another study, like the one run on I-435, where
everyone already knew the answer prior to the study. To him that was a waste of money.
Everyone knows the typography was terrible and the landfill was on part of it. He stated everyone
knew it didn’t have sewers and on and on and on. He stated they approved a TIF district for it
and are not beating down the front doors of the City to get in here.
City Manager Gonzales stated there is absolutely no utilities out there.
Councilmember Sawyer asked what else they need to do for that property. He stated he is
having difficulty when they say that whole $1.3 million is for the economic development fund.
That bothers him. They can show him the City is contracted at $300,000 and have the additional
monies sitting in the General Fund, but does not feel comfortable just saying it is economic
development.
Councilmember Vaught stated to address what was said about the fund in the beginning always
supposed to be for streets and said he never heard that conversation. The first time he heard
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about the impact fee, it was said they could use this fund for anything they want. The idea was
for economic development and street repair. Never once did he ever hear the City was going to
use this entire fund for streets.
Councilmember Vaught asked how much money was spent on street repair in 2011.
City Manager Gonzales asked how much they plan to spend.
Councilmember Vaught answered yes.
City Manager Gonzales replied $3.4 million.
Councilmember Vaught asked how much was spent on economic development and asked if it
was $286,000.
City Manager Gonzales answered yes.
Councilmember Vaught asked what is budgeted for roads in 2012.
City Manager Gonzales answered $2 million.
Councilmember Sandifer stated there was also stimulus money that came in.
City Manager Gonzales clarified not in 2011 and 2012 – part of it is CARS money they are
leveraging their funds to get County money.
Councilmember Vaught stated in 2012, they are budgeting $2,087,000 and are still spending
$286,000 on an EDC contract and putting money into a fund to use. He stated he is listening to
everyone saying they are spending all this money on economic development and not spending
anything on roads. He stated they actually spend a lot of roads. He stated they are giving the
EDC any more money – no more than their contract of $286,000. He stated whether they take it
out of the EDC fund or out of the General Fund to him, is irrelevant. They are going to vote to
how much money in that fund, which is City money, goes to the EDC. He stated as long as it is in
the economic development fund it is City money and the Council will approve the movement of
$286,000 from that fund to the Chamber for economic development.
Councilmember Vaught stated it is the same thing they have always done, but will just come out
of a different fund. He stated once this whole program gets going of $3 million, they are taking
the $3 million out of it and he asked to wait a second. He asked why they should not just
continue to pay the $286,000 out of the General Fund and designate 50% for economic
development, because he personally felt that is how it should be. He is not pushing that issue.
He can get his head around it. That is an economic development cost, so why not take it out of
this fund.
Councilmember Vaught stated to sit there and say nothing has happened on I-435 and no one is
beating down the doors, they have just gone through and are continuously in a horrible economic
situation in this country. He stated development is not happening at any stellar pace. He stated
the economic crash started over three years ago.
Councilmember Vaught stated Councilmember Sawyer is in the C-Store business and it really
does not affect them because people go in and buy their cokes, gas and everything every day.
He lives this every day. He stated he can show Councilmember Sawyer his income statements
over the past four years and will say he got hit hard.
Councilmember Vaught stated if they look around the City there is no development happening
compared to four or five years ago.
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Councilmember Sawyer stated in all fairness, he said maybe they need to do something else.
Councilmember Vaught stated maybe they do need to do something else and maybe the City
needs an economic development fund to do that, but what everyone is saying is they do not need
that fund so let’s just spend it on roads. He wants to know what they are to do that does not
involve money and where is that money going to come from if they use this fund on roads.
Councilmember Vaught stated Shawnee for years had a horrible reputation for economic
development. He stated when he started campaigning and called up the people in the business
and told them what he was doing and asked for their perception of development in Shawnee he
heard the same thing from a lot of them. He was told it was a tough city to do development in
and are not development EDC friendly. He stated maybe not over the last 5 to 9 years, but there
was a long history because Shawnee’s roots were they wanted to be a residential community.
That was the way it was years ago. They did not want commercial development. That set a tone.
Councilmember Vaught stated they start making these little movements that they are proeconomic development and everyone just wants to go and stick a knife in it. He stated they have
a big hill to climb. He stated there is no one beating down the door saying they want to come to
Shawnee.
Councilmember Vaught stated they just sat here a couple weeks ago and listened to Andrew
Nave give a presentation. He stated Shawnee is the fly over city. He stated Kansas City, Kansas
is happening right now and they have an identity. He stated Shawnee does not have an identity
because they are not big enough. He stated they are part of Johnson County and the main
player is Overland Park.
Councilmember Vaught stated when they look at development in Kansas City these people do
not ask to go look in Shawnee because they don’t know where they are. He asked how to get
that message out there and is probably not possible. He stated they are part of a bigger puzzle
and need to create incentives to bring people here and are competing on a big playing field.
Councilmember Vaught asked if he thinks giving the economic incentives to developers that they
do and other cities do across this country and state is right and answered no, he thinks it is
horrible and would like to stop it. He stated the only way they can stop it is at State level. He
stated if the State stepped in and said all cities are on an equal playing field and you can’t ‘do this
or do that’, they would be fine, but as long as they are competing against Overland Park, Olathe,
and Lenexa, even Kansas City, Kansas they have to compete.
Councilmember Neighbor stated Shawnee actually may have to compete stronger, because they
do not have the identity or track record. He asked if having a fund will build a road and answered
no. He stated like City Manager Gonzales said, it is going to end with one year and will continue.
If they can leverage that money to do a benefit district or something to bring a large type
development business park, it makes sense and is what they need to be looking at.
Councilmember Pflumm stated the part he has a problem with is they are just willing to spend a
little on a street, or whatever an economic development guy might need and he has no problem
spending as long as they know what it is up front. He stated they might be doing it backwards,
when they are bonding road improvements and taking money in a cash fund that was kind of
intended to go for streets – not only for streets, but streets and economic development.
Councilmember Pflumm stated in 2013, they are bonding their street maintenance program and is
troublesome to him. He stated if they had to put in a street down on 43 rd Street, they could bond
it because there is stuff there that will be impacted and they can see what will come in the door.
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Councilmember Morris thinks the Council is split and the entire Council is not present this evening
and they don’t have a finance committee so everyone can vote. He recommended to bring it
forward as it is today and have further discussion at the Council meeting when they can actually
vote on it. He thinks tonight’s discussion has been excellent. He encouraged the Committee and
people on the Council to get more information. He moved to bring that portion of it, as is, to the
Council.
Chairperson Distler stated she is not a commercial developer and her closest thing are properties
she has purchased, fixed up and flipped. She does not go in and build things, but guts them.
She stated she does not do what Councilmember Vaught does, but is looking at the safety of the
area, the appearance of the area – she is not going to purchase something at 39th and Troost or
at 39th and Prospect or on Quindaro. To her, an equally important part of economic development
is not only what they can do to help developers, but they talk about how they are short police
officers and fire staff.
Chairperson Distler stated she wants to know, as someone going in, if she herself, her
employees, and her building are all going to be safe and will be in a good clean area. To her, that
is just as important to economic development as the funding. When she sees others areas in the
City where they are short in staff, if they could use this money some place else, they could
possibly use it to help in other areas. She sees so much more that is not getting addressed.
Councilmember Vaught stated if a large developer is looking at Shawnee and ranked No. 17 in
the whole country as the most desirable place to live, does someone walk into City Hall and ask
how many police officers they have and how well are they staffed. He stated if a city ranks 17th
and someone does their homework, that alone will tell them they are pretty solid. That is more
important to them than the little details. They have a good work force and a good credit rating.
Councilmember Vaught stated they have a well maintained city. He stated they have issues with
roads, but everyone does right now because they took a huge economic hit. He stated if anyone
looked at Shawnee’s financials, they would realize they have a problem with roads, but seem to
be doing things right. They have a huge reserve amount and an unbelievable credit rating. He
thinks that weighs a lot more into the situation.
Councilmember Vaught stated the City is not being neglected and they have a plan. He stated
with residential, that neighborhood seems more important and he sees what Chairperson Distler
is saying, but at 43rd and K-7 . . .
Chairperson Distler stated she is talking about properties she has purchased, but is looking at the
neighborhood when she is purchasing it. She stated they got the one down across the hill from
Ponak's out there and have some properties in Westport. She stated her fear is if they keep
losing positions or keep going longer and longer without filling those firefighters and asked what
the defamation will be over time.
Councilmember Vaught stated Chairperson Distler is talking about something totally different than
roads. He has no problem in hiring more officers if the City had more money. He stated it comes
back to if they use this money for that . . . he thinks what City Manager Gonzales has tried to tell
them all is that they have had a lot of interest in 43rd and K-7 and want to keep cash available in
this fund. He stated they had a lot of interest three years down the road, but have a lot of interest
right now and would have probably filled a couple of buildings in them over the last 18 months if
they had a completed park.
Councilmember Vaught stated he thinks City Manager Gonzales is trying to tell them to keep
some money on hand here over the next 12 months, because Andrew is going after it and trying
to make it happen. They should not cut themselves short and create a problem and use it on ‘this
or that’, but maximize their potential and see if they can’t put it together. He stated if they can
make this happen, it will be a successful park.
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Councilmember Vaught stated in driving down I-435 between K-32 and the river – look to the east
and Edwardsville’s industrial park as it is almost full. He stated if they look at Shawnee’s park,
they are the only other flat piece of ground on the west side here that they can do that. There is
no other flat ground within Johnson County or Wyandotte County. He stated the taxes are not
cheap in Edwardsville and are going with high taxes and have attracted some huge users. He
stated Shawnee can have that same type of industrial park, which is a dynamite industrial park
and the revenue Edwardsville gets from it is tremendous.
Councilmember Morris stated the developers are going to look for accessibility to major
transportation highways and work force. He asked how they can put the numbers together to
work to make the deal. He stated No. 17 makes Shawnee a great city to live in, but they are not
looking so much to that as some other key things. He asked if this is going to work at getting
them in and out onto major highway or major railway areas. He stated Edwardsville is a huge
success.
Councilmember Vaught stated one of the biggest things he looks at is how easy or how much
struggle does he have to get through the City. He stated by the time a developer gets his project
to Shawnee, by the time he does what he has to do and gets through the Planning Commission
and to the Council, he already has unbelievable money invested; between engineering studies,
architectural fees, and permit applications, and hard money in the ground to hold the option. If he
does not think he has a Council that is forward thinking and can get his project approved, they
don’t bring it and that is what killed Shawnee for years.
Councilmember Vaught stated they can talk to any developer out there and they will say they
were not sure about the Council and were not sure they would get a project through. They will
then not make the investment.
Councilmember Vaught asked why KCK is happy with the way it is and answered because when
a developer comes to the table, Brent Miles takes them and says “Here’s your deal”, they know
when Brent Miles brings it to them, if it is a quality project, it is a done deal, because they all got
onboard with economic development and know what they need to survive.
Chairperson Distler stated she noticed in the policy statement for economic development, they
did have redevelopment listed. She asked if they are considering redevelopment as part of
economic development.
City Manager Gonzales stated that will be the choice of this Council. Her first thought was yes.
They have redevelopment tools that are incentives and the whole downtown program is about
redevelopment. She stated redevelopment may not be about leasing a space, but may be about
helping an owner redevelop a building to make it more usable for a user.
City Manager Gonzales stated this is a draft and just her thought process of the fund. During
each budget process the Governing Body would define the funding level. There could be some
very specific programs that could be developed geared towards very specific goals. She stated
with some money in that fund, when push comes to shove, they would have the discretion to use
it.
Councilmember Sawyer stated for clarification purposes, the City has had development happen in
this City and the City Council has made the right choices. When the shopping center out to the
west on Shawnee Mission Parkway was developed, they had to realign 55th Street and build an
$8 million bridge to nowhere. They had to do other things for access to the highway. He stated
to say they had not been predevelopment is not an entirely fair statement.
Councilmember Sawyer stated they made Perimeter Park happen and got an abatement to go in
there. He believes they need to start the fire and ‘they’ will come. He stated they all had to have
JULY 6, 2011
FINANCE AND ADMINISTRATION MINUTES
PAGE 22
an abatement. He stated he will say one last time that the thing that bothers him is that they set a
dollar amount out there and call it economic development.
Councilmember Sawyer stated if the economic development with the Chamber has a plan and
comes to this Council, he does not think there is a way it would not get approved. He thinks it will
take a lot more than $663,000 to happen out there today. He stated getting anything to happen
out there tomorrow is not going to happen.
City Manager Gonzales stated it is a 20 year park and no one thinks it is going to happen
overnight.
Councilmember Sawyer stated they want something to happen right away – he asked if that is
correct.
City Manager Gonzales replied she would like to see a sewer system set up and the pieces in
place to get sewers out there. She stated that does not mean walls are coming up because there
is nothing to sell out there right now.
Councilmember Sawyer stated as far as the streets, in all fairness, they have to take the CARS
funding out because they do not normally use that funding to curb streets. He stated they are not
always showing apples to apples, but it looks good when they are trying to make a point. He
stated they have to go back and take all the tax abatements it has taken for all the development
over the years. That is a figure out there the City is not getting. The real figure is what they gave
away to get what they have.
Chairperson Distler stated on the volunteer coordinator, she has no problem with the position, but
has trouble supporting it without knowing what the position expectations will be, as far as their
goals and what they will consider them as a success.
City Manager Gonzales presented the goals, as she sees, for that program.
Chairperson Distler stated that may be the case, but they could get a person in here and say they
met those goals in that they saved somebody time, and all that is listed on City Manager
Gonzales’ sheet.
City Manager Gonzales stated if they develop a plan, set goals, have a review process, and set
up training – she can’t tell them if they are going to get 30 or 300 volunteers. She hopes
someone comes in the door with that kind of experience to help the City set some reasonable
goals.
Chairperson Distler asked when they would know about the position.
City Manager Gonzales replied she thinks they need to give it a chance and the staff would report
in the data, numbers, and hours. If she does not think the program is working successfully she
will come to the Council and tell them.
Chairperson Distler stated she has high hopes as well.
Councilmember Pflumm asked if people have signed up yet, or is a process in place.
City Manager Gonzales stated the City has received some calls. She stated a church group
called one morning and asked if they had anything for them to that afternoon. She stated there is
no one who has the projects in one place. She stated they have started and since Mr. Houck did
his report, have identified some projects. They are doing more things right now, but do not have
a great system set up.
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FINANCE AND ADMINISTRATION MINUTES
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Councilmember Pflumm asked if they have utilized any of the individuals who have asked to help.
City Manager Gonzales stated the Shawnee Tomorrow had a group for the door hangers. They
just do not have the current staff to manage those projects at this time.
ROD HOUCK said he came before this committee a couple months ago with the issue of having
a volunteer be the coordinator or have a paid position. He stated he spent more time as a
volunteer and went back and contacted for different cities that have very professional long term
programs and asked specific questions about a volunteer versus a paid position. He stated
without any exception, everyone came back and said that position definitely has to be a paid
person. It has to be a position imbedded in the city.
ROD HOUCK said there are polices to be followed and procedures and staff training. He comes
from a small business world – an independent person. He is somewhat of a maverick and when
he sees something that needs to be done tomorrow, he has worked in a company where he could
go to the owner and tell him it had to be done tomorrow and was told okay.
ROD HOUCK stated in the project he did in researching volunteering opportunities and what
happened after that, someone came to one of the departments and said they heard they needed
volunteers. He took that maverick leap frog approach to take that person for some immediate
opportunities. What he did not understand was what the cultural protocol within the City was and
somewhat ruffled the feathers of a department head by doing that. There is a protocol in a city
and a volunteer coordinator will have to be paid.
Chairperson Distler stated some people are bothered with the private/public partnership with
Wonderscope and she does not really disagree with them.
Chairperson Distler stated something was brought to her attention she has never thought about –
it sounds like form what was given to her that the majority of chambers are self-supporting. It
sounds like they start out with help, but over the years somewhat wean off through their
membership dues and fundraisers. There is a city in Utah up in arms because the Chamber had
come to them during this recession time and asked for $50,000 to float them.
Chairperson Distler stated the question was posed to her about why Shawnee is such a big
supporter of the Chamber. She thinks a 5.2% increase was asked for 2012. She stated it is as if
the dependency is increasing rather than decreasing every year here in Shawnee. She did not
realize everyone did it differently.
City Manager Gonzales stated to clarify, there is the Chamber organization that is the business
retention and support. She stated they contract with that group and board that oversees it to do
two tangible functions. This function – they do not pay directly for; they pay directly for the
contractual relationships they have.
City Manager Gonzales stated within those are the overhead costs related to the offices and
computers that helps cover all the costs. She stated if it was just a chamber and they had no
contracts with the City, she imagines it would be a three person shop and supported by their
membership. She stated the City money purely pays for those contracts.
Chairperson Distler stated she will look further into it. It was brought up to her and she never
really had thought about it.
LINDA LEEPER said chambers run differently throughout the U.S., predominantly in Johnson
County. She stated the EDC and CVB are part of contract with the Chamber of Commerce.
They do that because they are very abreast of what is going on in the business committee and
work with them and build relationships with the City and the communities. She stated different
states do things differently and headlines are great but sometimes do not show the big picture.
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FINANCE AND ADMINISTRATION MINUTES
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LINDA LEEPER said some events have cups given out that show the website so people will
come to Shawnee and spend their time and spend their sales tax money.
Chairperson Distler stated that was actually part of what they brought up . . .
LINDA LEEPER interjected by asking – they who.
Chairperson Distler replied the person who brought this to her attention and when they had gone
to the chamber events page looking for events to do for the weekend and could not find anything
there and went to the City of Shawnee page. She asked if events are not listed on the Chamber
site.
LINDA LEEPER replied all events the City sponsors through Parks and Recreation are all on the
CVB calendar. She stated there is some overhead, but that is because they are covering cost
and provide support staff for the economic development support.
LINDA LEEPER said their funding is membership and have non-dues revenue. She would be
happy to talk to Chairperson Distler about the Chamber any time, because very chamber works
differently. She stated the great advantage with contracting with the Chamber is they are the
direct link to the business community. That provides an opportunity for lots of resources.
LINDA LEEPER said they have a Board of Directors who help economic development efforts.
That all falls in line. The reason why in Johnson County they do not have EDs within the City is
the fact of the open records law. If a developer is working on a project, obviously there is a point
they want it to be public, but prior to that there is a lot of negotiation that goes into it. That is why
it is a benefit to have it into a private organization and a lot are with the Chambers.
LINDA LEEPER said she does not know about many projects before they are finalized. They
provide the best possible support.
Chairperson Distler asked if taxpayer funding is funding this EDC fund it is not public record and
would not be line item.
LINDA LEEPER replied it is an independent contract with the Shawnee Chamber of Commerce
and they give an annual budget presentation.
City Manager Gonzales stated a lot of times the projects that come in with odd names, if it comes
to her it is an open record and could jeopardize the whole Kansas City area if someone were to
divulge that company, because they may for no reason want people to know they are looking.
LINDA LEEPER said that is a snippet of the reasons it is done that way and is not traditionally
structured in Johnson County – right or wrong. She stated if some of the CVBs are large, they
spin off and have a separate corporation, like Overland Park with 42 hotels.
Councilmember Vaught stated the Senior Softball Tour is coming up and Kevin Fern caught wind
about it and every hotel is full.
LINDA LEEPER said it is a $2.1 million impact to the community. She stated he started at 6:00
a.m. this morning and she thinks they are all still out there and playing.
JULY 6, 2011
FINANCE AND ADMINISTRATION MINUTES
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ADJOURNMENT
Councilmember Morris, seconded by Councilmember Neighbor, moved to adjourn. The motion carried 30, and the meeting adjourned at 9:34 p.m.
Minutes prepared by: Cindy Terrell, Recording Secretary
APPROVED BY:
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City Clerk Campbell