JOPLIN, Mo. —
There is a possibility that the Joplin Redevelopment Corp., which is focused on the city’s recovery from the 2011 tornado, could obtain an additional $4 million for redevelopment projects through state tax credits, the panel was told Tuesday.
David Wallace, chief executive officer of the city’s master development firm, Wallace Bajjali Development Partners, told the JRC board that the law firm that works for his company has discovered another possible source of capital from a state tax credit program.
“It will require a substantial amount of research and a lot of discussion,” and quick action, Wallace said. “If we do it and it works out, this body will end up getting $4 million in tax credits.”
The tax credit program would have to be approved by Aug. 28, when the state program expires, Wallace said, and the credits would have to be issued by the end of the year. He did not identify the particular program, but he told the board that it would provide unrestricted funds.
“I don’t want to say it’s found money, but it’s found money,” he told the board.
Wallace talked about the possibility during agenda items addressing the JRC’s financial transactions.
City Finance Director Leslie Haase told the board that the first $18 million issuance of bonds based on the tax increment financing district closed at the end of last week, netting $13 million after expenses and obligations related to property transactions.
She proposed that:
• $4.5 million of it be earmarked for the city’s matching share of a $20 million grant from the federal Economic Development Administration for the construction of a new Joplin Public Library. The grant funds are not available for use from the EDA yet.
• $4.9 million be used to pay off a loan the JRC obtained from a consortium of local banks that provided the money for land purchases for projects in connection with tornado recovery. The banks agreed to provide up to $8 million for land purchases until the TIF bonds could be sold. That loan is due to be paid off today.
• The city be repaid $800,000, which the City Council had agreed to deposit with the JRC in order to secure the bank loan.
• $2.7 million be used for upcoming land purchases and leases.
The upcoming land transactions include the lease of property on 20th Street near Connecticut Avenue for the construction of a new Joplin Public Library, and the purchase of the former Coca-Cola Bottling Co. plant at 1301 S. Virginia Ave. Wallace has said the Coca-Cola property is intended to be the new site for Joplin’s two post offices, which would consolidate.
Wallace told the board that the EDA recently required that 20 years of a lease on property contracted with the Jennings family in the area of the future library project be paid in advance to secure the city’s control of the land. The Jennings family is the former owner of Joplin area McDonald’s restaurants. That will cost $2.29 million rather than monthly lease payments, as had been intended.
There was some discussion among the board about how to meet that lump sum. Haase recommended that it be taken out of the bond issue money.
Brian Head, the city attorney who also serves as attorney to the JRC, said the land payments would have been made from the EDA grant if that money was already available. That grant, when it is available, will be used to make up the lump-sum payment for the Jennings land.
A source of funding for the Cola-Cola land purchase also had to be sought, the board was told. Wallace said the JRC cannot use the TIF bond proceeds because the plant is not in the TIF district.
Haase said Arvest Bank was willing to make a short-term bridge loan due Jan. 1, and the land and the Wallace Bajjali firm would guarantee it. Wallace Bajjali plans to buy land from the JRC in the fourth quarter of the year, and the money generated by that sale could pay off the loan. That is land where the firm intends to build its retail/loft project next to the library, and the senior transitional housing project at 26th Street and McClelland Boulevard.
The loan would be used to pay for the Coca-Cola property and leave $2.5 million for future land purchases, Wallace said.
The loan agreement was not provided to JRC members until the beginning of the meeting. Some of them questioned whether to approve it without having had time to read it. The board was told it could approve the loan request contingent on the city attorney and finance director approving it.
Head said he was not comfortable with that arrangement.
JRC member Phil Stinnett said he would like to have the documents before meetings. “I’m really uncomfortable voting on documents I don’t have until walking in the door” of a meeting, he said. “I think we should have a legitimate amount of time to review these things before we’re asked to vote.”
Haase said work was being done to complete the documents up until the time for the meeting to start.
The board agreed to hold a special meeting next Tuesday to review the loan documents and take a vote.
Change of plans
A PROPOSAL to temporarily lease the Coca-Cola building to the Joplin School District for book storage was withdrawn. David Wallace said the school district found it was not needed.