The Joplin Globe, Joplin, MO

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January 3, 2014

Legal fight over Neosho TDD tops $416,000

NEOSHO, Mo. — The city of Neosho and the Neosho Transportation Development District together have spent nearly a half-million dollars in taxpayer money fighting each other in court since 2012.

The city in 2012 unsuccessfully challenged the formation of the TDD in Newton County District Court, alleging that the district was formed under the wrong state statute. The city appealed, but was unsuccessful last month before the Southern District of the Missouri Court of Appeals.

The city’s legal cost from the beginning of March to the end of the year has been $75,314, based on documents obtained through a Missouri open-records law request. That is the period that includes the city’s appeal. A previous request, including 2012 through the end of February, included a total of $55,228. The city’s overall legal costs so far has been $130,542.

One final legal bill hasn’t yet been submitted by attorneys, said City Manager Troy Royer on Tuesday.

“I wouldn’t anticipate it being a whole lot,” Royer said.

The largest single invoice was one of $39,825.66 from August.

TDD board Chairman Steve Roark didn’t require an open-records request, but the dollar amounts he provided weren’t precise. He said the TDD has spent $286,000 defending itself against the city’s legal challenges since 2012. He also said there are outstanding bills and said he expects the total to reach $300,000.

Using the $286,000 figure provided by Roark and the city total of $130,542, the combined cost has been $416,542.

The TDD began collecting a half-cent sales tax in January 2012 within the district, an area along U.S. Highway 60 that includes the Wal-Mart Supercenter and Lowe’s. The tax is to finance the TDD’s $4.5 million share of the nearly $7 million worth of transportation projects. The Missouri Department of Transportation is to pay the other $2.4 million. Instead, the TDD’s sales tax money has so far gone mostly toward legal fees.

A project to install a traffic signal and make other improvements at Highway 60 and Kodiak Road was completed before MoDOT halted projects because of the legal challenges.

City officials have been striving to recover from a financial crisis caused by a $1 million budget shortfall in 2009 that caused city officials at the time to lay off 25 percent of the city’s work force.

Councilman Steve Hart has been the most critical of pursuing the appeal, repeating his opposition at several meetings. He has called the appeal a waste of money.

“We’re spending it like we got it and we don’t have it,” Hart said in September, after the city had received the $39,825.66 invoice.

Asked if he felt vindicated by the court ruling, Hart declined to comment.

Mayor Richard Davidson, who pushed to see the appeal through, said though the challenge has been expensive and unsuccessful, the ruling has value.

“The court ruling now gives the city a guard of protection if someone were to challenge the TDD in the future,” he wrote in an email response.

Roark said now that the court battles are over, he hopes differences can be put aside.

“We need to start talking with each other, do a better job communicating with each other,” Roark said. “I think it’s already begun.”

He said as large as the legal expenses are, the real loss is the lost retail development. He said he hopes it can be restored.

“We’re working with the City Council right now,” Roark said. “We’re hoping to get on the agenda for Tuesday night to reinstate the cooperative agreement” between the city and the TDD. The city council had revoked it during the legal battles.

Roark said construction on the TDD projects may begin in 2014, but it may be delayed until the 2015 construction season.

Davidson said in the email that time will tell if there’s to be greater cooperation between the entities.

“If that means understanding both sides have a job to do and finding a way to make both sides comfortable with the ultimate decision, I suspect we may find greater cooperation,” the mayor said. “But it will take effort on both sides.”

He said he already was hearing things that cause him to suspect a nasty city election is shaping up in April, though he wouldn’t be specific.

“I’m not convinced some have a true desire to cooperate at all,” he wrote.

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