By OLIVIA BERGMEIER
Salina Post
After years of discussions on a multimillion-dollar housing project just south of Magnolia Road, the Saline County Commission granted consent to the City of Salina to begin Phase One since the first phase outlined by the housing developer sits on unincorporated county property.
The City of Salina entered a development agreement with Overland Park-based housing developer Salina Destination Development LLC, or SDD, on Nov. 6. It was finalized on Nov. 17 this year, leaving just 45 days for the city to annex the county land.
A $25 million housing grant from the state will fund most of the planned one and two-bedroom apartments, with an additional $10 million rounding out the entire $35 million industrial revenue bond, or IRB.
An IRB exempts the developer from paying property taxes for a predetermined amount of time. For Salina, it will be 10 years. The IRB for SDD also provides another incentive, a sales tax exemption on construction materials for the project.
READ MORE: Salina City Commission approves multimillion-dollar housing incentive package
County Commissioners saw the issue during its Tuesday, Nov. 28 meeting and voted unanimously to allow the city to issue the IRB for the project.
According to County Administrator Phillip Smith-Hanes, the property for Phase One lies in what the county and city named "The Doughnut Hole," a piece of unincorporated county land surrounded by city property.
"The city has started the process of annexing the land, but they don't feel that the annexation will be complete by the time they have to issue the bonds," Smith-Hanes said. "We did this with the Kubota property down on South Ninth Street — it was the same situation where it was a timing issue."
Smith-Hanes encouraged the commission to direct questions to Salina Assistant City Manager Shawn Hennessee, to which Commissioner James Weese spoke first.
Weese asked Hennessee why the city did not annex the land sooner if the project had been a possibility for years.
"When we initiated the RFP [Request for Proposals] process, we received literally a smorgasbord of different proposals," Hennesse said. "In this case, what we did was we opened it up and said, 'Give us your ideas on where you would like to put this multifamily housing,' so we went through that process."
The city proposed multiple sites across town, providing developers with options for where to place the multimillion-dollar project.
Once SDD entered a DA with the town, it committed the company and the city to the large-scale project.
"It wasn't until relatively recently that we knew that this is where they wanted to put in the development for this property," Hennessee said. "Both the developer and the city wants that [the DA] because then that has those mutual commitments once the DA is signed."
Saline County Commission Chairman Robert Vidrickson asked why the city had not annexed locations like "The Doughnut Hole" and other unincorporated property surrounded by city jurisdiction.
According to Smith-Hanes, after some cities began rapidly annexing land in the 1980s to try and compete with other close cities, the state imposed more restrictions for city annexation of county property.
"Annexation in Kansas used to be fairly open, but as with many things, Johnson County spoiled it for the rest of us," Smith-Hanes said. "Lenexa, Overland Park and Olathe got into annexation wars back in the 80s trying to grab land that they felt would be useful for future development."
"As a consequence of that, the legislature came back and really restricted the ability of cities to annex unless there's a specific purpose or consent."
Hennessee agreed with Smith-Hanes on why the city waited to have the DA in place before annexing the unincorporated property.
County Commissioner Joe Hay commented on the public's interest in the project.
"I hear from people all the time, 'We want to see Saline County grow, we want to see Salina grow,' but we can't do that without housing," Hay said. "We got to have the housing."
Other agenda items on Tuesday, Nov. 28
Consent Agenda:
● Approval of community comment letter regarding Essential Air Service Proposals
● FY24 Justice Assistance Grant Assurances
Action Items:
● Bid award for 2023 Aggregate Shouldering
Informational Items:
● Road and Bridge Departmental Update
● County Administrator Update