Q39, a Kansas City-based barbecue restaurant working to open a location in downtown Lawrence, is asking the city for tax breaks that the company says are “without doubt” necessary to finish construction and open.
Lawrence city commissioners on Tuesday will consider a resolution to give the applicant an industrial revenue bond, or sales tax exemption, on construction materials to finish the project.
“Staff is supportive of granting the sales tax exemption at this time given the project’s investment in restoring and adapting an historic building and the potential for the project to be a catalyst for surrounding property,” according to the city staff memo to the commission. “The project is expected to include approximately $7 million in private investment and support 88 new permanent jobs, including 8 managerial positions.”
Commissioners will also consider allowing the city manager’s office to analyze potential costs and benefits of a tax incentive agreement with the applicant, RKM KU LLC, “the limited liability entity created by Q39 to develop, own and operate business.”
City staff members are recommending the commission allow them to look into a Community Improvement District sales tax for the property of 2% over 22 years.
The restaurant initially intended to open in October 2024. That’s been pushed back to summer of this year; “however that goal is contingent on the grant of the IRB sales tax exemption on construction materials,” according to the agenda.
Original plans were for Q39 to occupy a portion of the former Lawrence Journal-World building in the 600 block of New Hampshire Street in conjunction with another project to redevelop other portions of the building.
Q39 is now moving forward with the incentive requests to the city for its portion of the project “despite losing the development partner in the larger building,” according to the agenda.
“As a result, a range of planning issues and costs not originally expected for the larger building have been absorbed by Q39, including the burdens for submission of this incentive application,” the application states.
“In order to keep its original commitments to the project and timeline, it was necessary for work to begin prior to this application. It is without doubt that a successful and sustainable operation for Q39 requires application of the City’s economic tools be applied to this site.”
“The project at 639 New Hampshire is comprehensive. The building requires a full range of improvements. In addition to a new roof, windows and entries, the building will get new mechanical, electrical, and plumbing systems,” Patrick Watkins, an attorney representing Q39, wrote in the incentive application. “It requires all new connections for water distribution, sewer connections, electrical service and gas lines, including a potential sewer line relocation. The site planning and building permit processes were rigorous and require a range of safety and ADA related improvements, site work, and design review compliance requirements.”
If the commission approves, the applicant will have to pay for the cost of financial analyses and legal work to ensure compliance with state statutes, according to the agenda.
Check out previous coverage of the project at this link.
Lawrence city commissioners will meet at 5:45 p.m. Tuesday, Feb. 11 at City Hall, 6 E. Sixth St. See the complete agenda item at this link and the full meeting agenda at this link.
The commission accepts written public comment emailed to ccagendas@lawrenceks.org until noon the day of meetings. The commission also hears live public comment during meetings, both in person and virtually. Register to join the Zoom meeting at this link.
Meetings are open to the public, livestreamed on the city’s YouTube channel at youtube.com/@lawrenceksvideo and broadcast on Midco channel 25.
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Mackenzie Clark (she/her), reporter/founder of The Lawrence Times, can be reached at mclark@lawrencekstimes.com. Read more of her work for the Times here. Check out her staff bio here.
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