This ordinance will approve an amendment to the Trinity TIF Agreement to facilitate a sale of the remaining undeveloped portions of the TIF Redevelopment Area from a bank holding company to a new developer that will seek to develop these remaining areas.
The Trinity Development Tax Increment Financing Plan (“TIF Plan”) was approved by the City Council on November 7, 2005. The original developer was Trinity Real Estate Development, Inc., which developed portions of the TIF Redevelopment Area. The City and the original developer entered into the Tax Increment Financing Redevelopment Agreement dated August 30, 2006 (the “Redevelopment Agreement”). The TIF Plan was amended in February 2008 to provide for a return of the captured Events Center Community Improvement District sales tax revenues back to the Events Center. The City also approved the Trinity Community Improvement District for the project in September 2008.
The original developer pledged the property and the right to receive TIF revenues to Valley View State Bank as security for a debt associated with development of the property. Valley View State Bank merged into Security Bank of Kansas City.
The undeveloped portions of the property in the Redevelopment Area were transferred to Trinity Property, LLC (“Trinity Property”), a single-purpose entity owned and managed by Security Bank through a Deed In Lieu of Foreclosure action. Trinity Property took an assignment of TIF Revenues in 2013. Trinity Property has held the property since that time. Security Bank and Trinity Property and the bank have lined up a potential sale of remaining the undeveloped areas to Trinity Woods, LLC.
Trinity Woods, LLC is a single purpose Missouri limited liability company formed to acquire the land and development rights of the remaining undeveloped property within the Trinity Woods TIF. The majority ultimate owner of Trinity Woods, LLC is Owen Buckley, the founder and President of Lane4 Property Group, a full service commercial real estate firm based in Kansas City, Missouri. Trinity Woods, LLC may sell portions of the subject land to be developed by third parties and may develop portions of the subject land, which would likely take place through new affiliated single purpose entities.
Trinity Property as the seller and Trinity Woods as the buyer have requested amendments to the TIF Agreement to facilitate the real estate transaction and the development of the remaining undeveloped portions of the TIF Redevelopment Area. Certain of these amendments which relax land use and development restrictions would apply generally to the TIF Agreement for any purchaser. Other amendments would apply specifically to Trinity Woods when that entity actually purchases the property after this amendment is executed.
A summary of the changes to the TIF Agreement as a result of these amendments are as follows:
- Amends the definition of “Developer” and other relevant contract provisions to allow for a transfer to new developer Trinity Woods, so that Trinity Woods steps into the project as the new developer of record for the remaining undeveloped portions of the TIF Redevelopment Area.
- Verifies the current status of the overall project and verifies that no further public improvements are necessary unless otherwise required as part of the normal development process.
- Verifies that Trinity Woods has the right to receive TIF revenues going forward, and that Trinity Woods can assign this revenue to a lender (including Security Bank) for the purpose of securing a new loan to facilitate further development in the undeveloped areas of the TIF Redevelopment Area.
- Eliminates the payment penalty on business relocation from an existing relocation within the City, provided that a business cannot relocate from another existing TIF area in the City to the Trinity TIF area. If a business does relocate from an existing location in the City (other than from another TIF area), the City will have the statutory ability to apply the base sales from the prior location in the prior year to the new location in the Trinity TIF area so that only the incremental increase in sales taxes, above the base sales from the prior location, would be captured as TIF revenues from the relocated store under the Trinity TIF Plan.
- Clarifies the obligation to restore a business after fire or other casualty to provide that the actual owner of the store has the obligation to restore, rather than the new developer Trinity Woods.
- Clarifies that new developer Trinity Woods can assign its obligations under the TIF Agreement to another party after delivering to the City a transferee agreement (using a form attached to the original TIF Agreement) which obligates the purchaser to honor the applicable restrictions and obligations of the TIF Agreement.
- Relaxes the restriction on fast food restaurants to allow for more than two fast food restaurants in the TIF Redevelopment Area. The original TIF Agreement allowed a maximum of two fast food restaurants in the TIF Redevelopment Area.