by Ivan Foley
Reacting to the position of county taxpayers being the backing of bonds for the Zona Rosa shopping district, Platte County commissioners have passed an ordinance that will require voter approval of any similar action in the future.
The ordinance, however, could potentially be changed or eliminated by action of a future commission.
Platte County taxpayers were put on the hook to back Zona Rosa improvement bonds most recently by a 2-1 vote of a county commission that consisted of Betty Knight and Jim Plunkett. Tom Pryor, the third member of the commission at the time that action was taken in 2007, voted against.
“The enforcement teeth in this ordinance is an informed and aware public,” said Dagmar Wood, first district county commissioner. Wood said that county taxpayers “have been used and abused for too long.”
Ron Schieber, presiding commissQioner, agreed, and both commissioners encouraged the press in the audience to draw attention to the matter if any future county commission should move to rescind the new ordinance.
“That should be a red flag,” Schieber said.
Zona Rosa was built in 2004 and expanded with a second phase in 2008.
A one cent sales tax collected in the Zona Rosa shopping district is not generating enough revenue to cover an annual $2 million bond payment to a transportation development district (TDD). The TDD is the funding source for paying off bonds that were used to construct infrastructure in the shopping center located at I-29 and Barry Road.
In 2007, the Platte County Industrial Development Authority--at the majority approval of the county commissioners at the time--issued additional transportation revenue bonds as a financing tool for the second phase of Zona Rosa development. Phase two included another parking garage and other infrastructure, as well as a Dillard's store, etc.
For the bonds during the first phase of Zona Rosa construction, the county was potentially liable for $18.6 million, but under the 2007 resolution the county became potentially liable for $32.2 million.
Historically, the owners of Zona Rosa have covered the revenue shortage by making a cash payment to the TDD, county officials say. That did not happen this past year, and UMB Bank, as trustee of the bonds, has drawn on the letter of credit the owners of Zona Rosa had on file to meet the shortfall for the 2017 payment.
That letter of credit was not replaced by the Zona owners, and as a result the county has had to prepare for taxpayer funds being available to cover the shortfall.
The Zona Rosa shopping complex remains for sale. Wood said on Monday it is hoped the district will have new owners sometime in 2018.
In the meantime, she said, she hopes the public “will join me in continuing to shop at Zona Rosa” to help support the apparently struggling district.
Wood said best case scenario will be for new owners to come in and transform Zona Rosa the way the former Tuileries Plaza, which went bankrupt, has been revived. New owners came in and revitalized the district into a now apparently thriving retail area known as Burlington Creek, located near I-29 and 64th Street in southern Platte County.
Schieber emphasized that while the county taxpayers are not technically “legally” bound to cover the debt, not doing so would severely damage the county’s credit rating.
The new ordinance passed this week says the county commission “shall not take any action to use an annual appropriation credit of the county to guarantee the repayment of any bonds issued by any other entity without first submitting to voters of the county, at a county or state general or primary election, a proposal to authorize the county commission to use an annual appropriation credit of Platte County to guarantee repayment of bonds issued by any other entity.”
“This is a layer of protection for taxpayers,” Schieber said. “I would hope that future county commissions will take this seriously based on the mess we are in with Zona Rosa.”
Wood said that the action taken by the county commission in 2007 means over the next 15 years county taxpayers could be on the hook for “a $17 million to $40 million shortfall, money that the county does not have.”
She again expressed frustration that “only two people made the decision” to have taxpayers back those bonds.
Alicia Stephens, executive director of the Platte County Economic Development Council, was in the audience at Monday’s commission meeting and agreed with Wood that the public should be encouraged to continue to spend money at Zona Rosa.
“The best way to get those bonds paid off is to continue to shop at Zona Rosa,” she said.
Stephens said that prior to Zona Rosa coming along, a lot of dollars of Platte Countians were being spent in neighboring counties due to the lack of shopping options in the county at the time.
John Elliott, second district commissioner, told Stephens “we’re glad Zona Rosa is here. We want Zona Rosa to be successful. Our concern is the bonding document.”