A missed opportunity. That is the best way to describe NWK Investments’ decision last week not go through with plans for its Big Creek Travel Plaza. The $27.4 million project would have been located at Exit 157 on Interstate 70.
Even though the Hays City Commission did not record a vote on any of the economic development incentives sought by NWK, it became obvious at the Sept. 3 work session there was not enough support for the tax increment financing portion of the deal. The TIF would have generated close to $10 million, which the developer planned to use to help pay for land acquisition, public infrastructure and site improvements.
“The NWK project was not possible without tax increment financing,” said Don Hoffman, attorney for NWK Investments.
As a result, the city will forego an estimated $7.8 million sales tax revenue and $2.8 million in transient guest tax over the next 20 years. Water and sewer infrastructure, which actually would have benefitted residents living south of the interstate as well, will not be run to the corner of 230th Avenue and 55th Street. And the potentially vital I-70 interchange will not have a truck stop, hotel and restaurants to attract any of the more than 12,000 vehicles passing by daily.
“I think it was a missed opportunity,” said Aaron White, executive director of the Ellis County Coalition for Economic Development. “I don’t see that kind of a project developing without any assistance.”
City staff had recommended the commission approve the project, which in addition to the TIF also called for a community improvement district 2 percent sales tax NWK would use for construction costs, and the issuance of Industrial Revenue Bonds so the construction costs would be tax-exempt.
While the state and local incentives would have paid for at least half the total costs, the project made sense. But at least two issues stood in the way of moving forward.
The first is having a city commissioner who doesn’t believe in the economic development incentive packages previous commissions have authorized to help the city grow. Commissioner James Meier has indicated he wouldn’t have voted for any of the three requests on principle alone.
In our opinion, that will prevent any future significant development from taking place in Hays. We don’t favor unrestricted corporate handouts, but some projects simply require a public-private partnership to make happen.
Still, Meier is only one vote. That would not have been enough to prevent the Big Creek Travel Plaza from being built.
Other commissioners were insistent NWK follow the procedures outlined in the incentive programs. Assistance is only to be used for a beneficial project a developer can’t make happen without that aid.
Precisely what the developer was requesting was a moving target, changing even up to the last work session. The original concept suggested private investors already were lined up and just a CID was needed. Months of submissions and revisions of the paperwork eventually led to requests for the TIF and IRB as well, but no financial details showing their necessity.
“I was very excited about the project,” said Commissioner Henry Schwaller IV, “any new investment in the community. The challenge was they could not demonstrate that they needed the money.”
At that point, a period of negotiation should have taken place. Unfortunately, it did not. Instead of working toward a compromise all interested parties could be comfortable with — one that would benefit local taxpayers, governmental units and the developer — the talks simply broke off.
That should not be the way economic development takes place. Give and take is a necessary component of negotiations.
We sincerely hope the Big Creek Travel Plaza is not the missed opportunity it appears to be at this point. After everybody’s collars cool off, talks need to be restarted. There simply are too many positives for the community this development would create.
Editorial by Patrick Lowry