Lawrence city commissioners will consider advancing multimillion-dollar tax incentives to help fund the second phase of KU’s Gateway Project and a proposed Q39 restaurant downtown. The meeting will include public hearings on both.
The Gateway Project’s first phase included renovating much of the KU football stadium and construction of a conference center. That’s on track to be completed in August. The approximate price tag of Phase 1 is $448 million.
Phase 2 of the Gateway Project is proposed to finish the south and east sides of the football stadium and construct about 1,000 parking spaces above and below ground. It also includes a 20,000-square-foot outdoor plaza; 162-room full-service hotel; a 443-bed student housing facility; and 43,000 square feet of retail, restaurant and office space.
The second phase has an estimated cost of $311 million. The total estimated state and local incentives package is $85.2 million, all directed toward the stadium and parking improvements. The entire Gateway Project has an estimated price tag of $759 million.
“Though there are many steps, and more information will be provided through the next several months and respecting any additional information that will come out of public participation, I recommend approval of all the district boundaries as presented,” City Manager Craig Owens wrote in a memo to the commission.
The commission is considering a package of public incentives for Phase 2:
A sales tax and revenue bond district would allow future sales tax revenue generated within the area to be used to help finance the development.
A tax increment financing district uses the increase in property tax revenue from the development area to help pay for project-related public improvements.
A community improvement district would create an extra sales tax of up to 2% over 22 years to provide for the sales of up to $20.2 million in bonds.
On Tuesday, the commission will hold public hearings and consider giving initial approval to the STAR and TIF districts. The city will consider establishing the community improvement district in July and August, according to the commission’s meeting agenda.
KU Chancellor Douglas Girod has previously said the project will be attractive to prospective KU students, bring business to the downtown area and provide millions of dollars in property taxes thanks to nearby private developers.
KU Endowment has pledged the donation of no less than $4 million of land to be used for affordable housing or other city uses, and the project will contribute $14.5 million toward stormwater projects in the Jayhawk watershed, according to the meeting agenda.
“This project represents a generational investment by KU, its donors, and KU Athletics in its facilities and greatly enhances the economic development contribution of KU to Lawrence,” according to the meeting agenda.
The commission Tuesday will also hold a public hearing and consider approving a set of incentives for a proposed Q39 barbecue location downtown.
Commissioners will discuss the potential creation of a community improvement district and issuance of industrial revenue bonds for the redevelopment of 639 New Hampshire St., the former site of the Lawrence Journal-World that has sat vacant for years.
The Kansas City-based barbecue restaurant previously said the tax breaks are “without doubt” necessary to finish construction and open. According to the commission’s meeting agenda, the restaurant plans to open in summer or fall if the incentives are granted.
“The project is expected to include approximately $7 million in private investment and support 88 new permanent jobs, including 8 managerial positions,” according to the meeting agenda.
The developers are requesting an industrial revenue bond to obtain an approximately $177,000 sales tax exemption on allowable construction materials and labor. They are also asking for an additional community improvement district 2% sales tax collected over 22 years, which reimburses the developer for eligible construction costs during redevelopment of the property. The tax will provide reimbursement of approximately $3 million of redevelopment costs, according to the meeting agenda.
Commissioners in February deferred their decision on a request from the developers.
Commissioners will begin their regular meeting at 5:45 p.m. Tuesday, May 6 at Lawrence City Hall, 6 E. Sixth St. See the complete 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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Cuyler Dunn (he/him), a contributor to The Lawrence Times since April 2022, is a student at the University of Kansas School of Journalism. He is a graduate of Lawrence High School where he was the editor-in-chief of the school’s newspaper, The Budget, and was named the 2022 Kansas High School Journalist of the Year. Read his complete bio here. Read more of his work for the Times here.
More about the KU football stadium project:
August Rudisell/Lawrence Times
Lawrence City Commission to consider tax incentives for KU Gateway Project, Q39
Latest Lawrence news:
Molly Adams / Lawrence Times
Chloe Anderson/Lawrence Times
August Rudisell/Lawrence Times
