With a pair of 7-0 votes, the Springfield City Council entered into a tax increment financing agreement that will reimburse some utility and street developments at a key interchange at a spot where Springfield meets the suburb of Republic.
The council finalized the agreement on March 7. Councilman Mike Schilling, who once referred to the Brody Corners property as “hellish,” voted in support of the agreement after raising environmental concerns about the project in February.
“This is somewhat of a challenging proposal,” Schilling said. “We’ve got to extend our water line and do some work on Sunshine out there near our intersection, some highway work to make it work, but basically, I see this as a needed reclamation-slash-economic development project to get rid of that bad trailer court that’s been sitting there collecting trash for a number of years.”
Springfield Director of Planning and Development Susan Istenes explained that the council vote only pertained to the financial agreement. The final plat, a detailed map of the property drawn to scale and showing its proposed development, goes before the Springfield Planning and Zoning Commission on March 10.
“In order to move forward with the project in terms of development, there will be a plat in front of our planning and zoning commission,” Istenes said. “The plat will not come back to council.”
Brody Corners is a $27 million project on 28 acres of land that was once a mobile home park in unincorporated Greene County. The land has since been annexed into Springfield as part of a plan to build retail stores, some type of quick-service restaurant, office space and service industry spaces.
The land sits at the northwest corner of the U.S. Highway 60 interchange with West Sunshine Street. West Sunshine Development, LLC, is listed as the property owner. The LLC has an address on South Fremont Avenue in Springfield and is registered to developer Mike Seitz of Triple S Properties.
The developer asked for a $3.4 million deal with the city of Springfield to help pay for the cost of connecting the development to city utilities, sewer and stormwater infrastructure construction, excavation, street improvements and “allowable project fees.” The incentives are part of a tax increment financing package, or TIF, which diverts a portion of the property and sales taxes after the project is built to help pay back the developer for certain costs.
Attorney Cory Collins of the Springfield firm Husch Blackwell represents the developer. Collins was the only person to speak to the city council at a public hearing on Brody Corners on Feb. 22.
“The request here is for reimbursement of a portion of the public infrastructure,” Collins said. “This is not lining pockets of developers or paying for infrastructure that is theirs that they are going to use in their private part or any portion of it.”
Councilman Schilling voiced his concerns with illegal wastewater treatment, or lack of treatment, at a council meeting on Feb. 22.
“The big problem that has occurred with it is environmental. The untreated sewage system out there, the lagoons. Is there any plan requiring the developer to deal with that–closure, whatever you call it, to deal with the lagoon situation?” Schilling asked.
But on March 7, Schilling voted to support a project along a key route for many people who go from Republic to Springfield and back on a daily basis.
“I hope that if this is successful that it probably opens up some more development out that way, and I hope that we can do that in a wise way and avoid the pitfalls of sprawl,” Schilling said.
According to the Brody Corners documentation, the property was Whispering Lanes Mobile Home Park until 2012. In 2014, the Missouri Department of Natural Resources took action to close two sewage lagoons on the property found to be out of compliance with state regulations.
In 2014, Greene County Circuit Judge Michael Cordonnier found in favor of the state of Missouri and the Department of Natural Resources in a case against RLB Properties, which operated Whispering Lanes. Judge Cordonnier ruled that the mobile home park and its wastewater treatment system violated the Missouri Clean Water Law, and that RLB had 30 days to demonstrate complete closure of the lagoons to the Department of Natural Resources.
The judge assessed a civil penalty of $41,820 on RLB Properties.
In his ruling, Cordonnier noted that RLB never had a permit to operate wastewater treatment lagoons, and that the mobile homes were illegally discharging sewage from a lagoon into a sinkhole on the property from at least 2002 to 2013.
According to Collins, West Sunshine Development, LLC, did not buy the property directly from RLB. West Sunshine reportedly bought the property from a financial institution in Arkansas that held a deed of trust and foreclosed on the property.
According to the TIF proposal documents supplied to city council members, the development is expected to generate $8.07 million in tax revenue over a span of 23 years, eventually reaching a tax collection level of more than $400,000 per year. Without the development, the projected tax revenue for the property drops to about $287,000 over 23 years, according to calculations that Springfield Economic Development Director Sarah Kerner provided to the city council. The city of Springfield’s tax benefit over the life of the TIF agreement is projected at about $1.5 million, while Greene County stands to make $1.9 million in added tax revenue if the development lives up to its potential.
To qualify for tax increment financing, a piece of property must be blighted. “Blight,” legally means that unsanitary or unsafe conditions make the land unsuitable for use, but for the plan to develop and repurpose the land. Under Missouri law and under Springfield ordinance, the tax increment financing agreement between the developer and the city of Springfield must demonstrate a positive economic impact for all of the taxing districts involved in it.
The blight study for the Brody Corners, done in February 2021, notes dilapidated structures from the mobile home park and asphalt streets in poor condition. It also noticed the presence of two sinkholes near the spots where the unapproved sewage lagoons were located.
The Brody Corners development will capture 75 percent of new real property taxes and 50 percent of new sales taxes collected within the 28 acres of land. The remaining sales tax collected — 25 percent of new real property taxes and 50 percent of new sales taxes — will be paid as it usually would to the Republic School District, the city of Springfield, Greene County, Ozarks Technical Community College and the Springfield-Greene County Library District.
The interest rate clause in the reimbursable funds from the tax increment financing agreement has been amended since the last time the Springfield City Council took up the issue in December 2021. Initially, the agreement called for a 6-percent interest rate. The agreement now specifies that the rate is the prime interest rate plus 1.5 percent, with a cap of 6 percent.
According to Councilman Andrew Lear, the prime interest rate is presently somewhere around 3 or 3.25 percent.
Personal property taxes are not captured in tax increment financing agreements.
The Springfield Tax Increment Financing Commission was slated to hold a public hearing on the project on Nov. 15. However, it was determined that the TIF Commission did not adequately publish a notice for the public hearing, and so the meeting was reposted and a public hearing with the TIF Commission occurred on Nov. 22.
Collins said that the Springfield Tax Increment Financing Commission heard the case for the agreement twice. It voted to recommend approval for the project on Nov. 22.
“We had a posting issue for the TIF Commission, so we had to reschedule it,” Kerner said at a special city council meeting held Dec. 6, 2021. “We got it rescheduled for one week later.”