The Hays City Commission voted 4-1 Thursday to pursue extending city infrastructure and paving a portion of 41st Street adjacent to Vineyard Park. The project would extend a current, three-quarter cent Transportation Development District tax that was implemented at several businesses when Home Depot was developed.

Several commissioners expressed support for the measure, saying extending the street and city infrastructure could help foster additional development north and east of Home Depot.

“I think that area is just ripe for a housing development out there, and this is a great first step to get some things going,” Commissioner Sandy Jacobs said. “This shows we’re really interested in that area developing. I know there’s going to be some challenges, but I think it’s going to be great.”

A design/engineering agreement for the project — extending the road to the east property line of Vineyard Park — was approved Thursday, with the low bid of $19,778 coming from Driggs Design Group. The total project cost is estimated at approximately $1.5 million, which would be funded by implementing a second phase of the TDD, which affects Home Depot, IHOP and Hampton Inn.

The tax district includes provisions for a second phase for additional road improvements in the area if revenue collections exceed expectations.

Tax receipts are accelerating in the district, with $2.52 million collected, according to documents from city hall. City staff believes the tax district could fund an additional $1.5 million bond for the road extension.

Mayor James Meier cast the dissenting vote, saying he views extending the duration of the TDD as a tax increase. He also expressed skepticism that extending infrastructure would significantly advance potential development in the near future.

“In my opinion, this is something that probably should just go away. It’s not something that I really think is necessary to the function of the city,” he said. “I can understand all of the arguments that are being made.”

“In my mind, what this is doing is pretty much directly in contradiction to the discussions that we’ve been having about infill, and especially discussions we’ve been having about land prices,” Meier said. “I think the idea of extending infrastructure, and then that somehow is going to open up development, is kind of a fallacy because we’ve seen that with all the infrastructure and the roads and everything we’ve put up on north Vine.”

He also said he has not heard complaints from residents regarding the current gravel road used to access Vineyard Park. Meier noted the additional 75-cent sales tax could make a significant difference for local businesses and customers who shop at Home Depot for large-scale projects.

“Three-quarters of a percent means a lot of money. It probably doesn’t mean that much when you’re going to buy $5 at Walmart,” he said. “But when you go spend $40,000 to remodel your kitchen, three-quarters of a percent means a lot of money. We have an opportunity here to get rid of that and to improve the ability for people to do what they want to do with their own homes. ... If that three-quarters of a percent sales tax goes away, perhaps that makes those empty lots already in that district more developable.”

The TDD is slated to sunset in 2027, or earlier if all infrastructure-related bond debt is paid off early. The tax could be retired early if the city does not decide to use the money for additional improvement projects.

The city commission in 2007 considered extending 41st Street, but canceled the project before going out to bid because they did not want to add to the city’s debt burden at that time.

Plans for the road extension call for a two-lane concrete road with gravel shoulders and ditches. Stormwater drainage and waterline extension also would be included for the length of the project.

City Commissioner Henry Schwaller IV pointed out the TDD sales tax affects only a few businesses in the city.

“If you don’t want to pay the sales tax, don’t shop there,” he said. “We’ve said that since the beginning.”

The city’s ultimate, longtime goal has been to someday connect 41st Street from Vine to Commerce Parkway to provide another access point, Schwaller said.

“I’m excited that we have enough revenue to get this along. I see that land, particularly to the east and the north, as being ripe for development — for new housing, perhaps for new commercial property as well,” he said. “I think it will tie in with what probably will happen on Commerce Parkway and have access to this other land. It’s really kind of land-locked. No one wants to drive down a gravel road. They do it, but I think this could be really big.”