Interchange project a long time coming

Sunday, July 3, 2005

Handshakes. Smiles. And laughs.

Two current mayors, a couple of lawyers, a few engineers and other elected and appointed officials both past and present patted each other on the back Wednesday afternoon for reaching a monumental and unprecedented compromise that will bring another interstate interchange to the region.

There indeed was much to smile about.

The economic consequences won't be realized for some time, but the potential is huge. Southeast Missouri State University plans to build a life sciences research complex around the interchange, bringing good-paying jobs to the region. Developer Earl Norman will have an opportunity to subdivide his land, make some money and perhaps bring more retail options to Jackson and Cape Girardeau customers. Both cities and the county could bring in more sales-tax revenue. Jackson would have another new exit for a relatively landlocked residential section of town. And Cape Girardeau could grow north and west quickly.

Beyond that, the deal is unprecedented in the state for two reasons.

One, according to Missouri Department of Transportation planning director Kyle Kittrell, never before have four local government entities combined their resources for one interchange.

And two, the interchange was the first in the state, according to former MoDOT district engineer Scott Meyer, to receive a 50-50 cost-sharing agreement by the state.

So there are a number of reasons why all those involved wore smiles and exchanged pleasantries Wednesday.

But the East Main Street interchange project wasn't always a happy endeavor.

Players came and went

The project took more than a decade to piece together. Elected officials have come and gone over the project's duration. A few players have died since the first whispers of the interchange. Even more have retired or moved to other jobs.

Along the way, behind closed doors, powerful men with strong opinions haggled over millions of dollars. They each had to look out for their own constituents. They all had their own reasons for wanting the interstate, their own ideas of what fair would be. The compromise announced Wednesday was not simple.

For several months last year, the different sides quit meeting as Jackson officials, upset with the demands and attitudes of other parties, particularly the university, took the position that if concessions weren't made, then the interchange wouldn't be built.

Jackson, which secured MoDOT funding by promising a 50 percent local match, found itself with little leverage because the city had been the entity that promised MoDOT it would come up with the local match. But Jackson was insistent that a transportation development district be formed. A TDD would allow property owners within the district's boundaries to impose a tax on themselves. In this case, a 1-cent sales tax will be applied to any development that comes to the area. The property owners also agreed to a self-imposed property tax increase of 10 cents per $100 of assessed valuation to help pay for the interchange. The revenue generated from the sales tax and the property tax will go toward paying off bonds that will be sold to generate funding for the interchange.

But Southeast Missouri State University officials didn't like the specific financing terms of the original TDD arrangement. The university would have had to take on too much financial burden and risk, university president Dr. Ken Dobbins said of the original proposal.

There was some talk about a tax-increment financing district, an option similar to a TDD, except instead of adding a self-imposed tax increase, all of the extra tax revenue created by growth would have gone to the interchange instead of the school districts. Cape Girardeau, Jackson and county officials didn't like those arrangements.

Even after more than a decade of progress, Jackson officials were wondering as recently as last year whether the project would ever get built. A round of high-stakes interchange poker ensued.

Lobbied legislators

In the meantime, the local four governments lobbied their U.S. congresswoman and senator, asking that federal funds be granted to the project. All of the parties insisted to Jo Ann Emerson and Kit Bond that the project was of regional interest for both economic enhancement and transportation needs.

After something of a standoff, the university eventually brought an alternative TDD idea to the table, and the negotiations again moved forward.

The next hurdle was reaching a compromise between the four parties on the local match of $2.9 million. At first, it was proposed that Jackson pay half of the $2.9 million and the rest of the parties pay one-sixth each. Jackson officials, including aldermen, didn't think that was fair.

Sure, Jackson initiated the project. Sure, Jackson should pay a little more. But considering the benefit that the other players would receive, the Jackson camp thought 50 percent was too much.

In Jackson, the internal negotiations were as fierce as the negotiations among the four governments, city administrator Jim Roach said. There were battles on the board of aldermen as to how much the city should bend, and, if so, at what cost would it come to the roads on the west side of town. How much would the city be willing to invest in one project?

One day, Jackson Mayor Paul Sander, the only negotiator to see the project from start to finish, scratched some numbers on the back of a matchbook at lunch, trying to come up with a better deal. He figured Jackson could pay 34 percent and the rest of the entities could pay 22 percent each. Early this year, all parties agreed to those terms, and Sander and others said the parties were "a couple of weeks" away from a major announcement.

But the negotiations hit yet another snag.

Right-of-way issue

Developer Earl Norman's real estate business, Lorimont Ltd., learned that MoDOT would have to take 13 to 14 of Norman's 19 acres for right of way. That just wasn't acceptable.

Jackson long ago pledged that it would not pay property owners for land. City officials argued that the project was as good as gold, a project that would dramatically increase property values. The city would not pay property owners to increase land values by constructing an interchange. Two property owners, brothers Larry and Randy Reutzel, were immediately on board to donate right of way. Norman's group was too, but he wasn't going to give it away at the expense of his investment.

For months, the right-of-way issue stalled the project, a blueprint that had already been pushed back one year on MoDOT's plan. Early in the design stages, the interchange was proposed at a location slightly south of the current proposal, but local officials were quick to point out that Old McKendree Chapel, a piece of local religious history, was in the way. To protect the historic site, the route was changed.

Toward the end of negotiations, MoDOT came up with a number of different drawings at the proposed location, but none of them satisfied the developers' acreage requirements.

On June 17, MoDOT threw another wrinkle into the equation. Interim district engineer Cheryl Ball told the local parties that they needed to reach an agreement by Aug. 1. If not, the district would spend the $2.9 million on other projects in the district and would take the project off the five-year plan.

Eventually, the parties negotiated terms to get Lorimont (officially listed as Warren Place) two more acres. The acres would come from the university, which would be refunded by tax revenue from the TDD. It wasn't an ideal arrangement for the government entities, Sander said, but he argued it would be a colossal mistake to throw away such a project over two acres of ground.

It turned out that the final acreage arrangements were for naught. After the accord was reached with the developers, MoDOT informed the parties that the state didn't need quite as much right of way as it first thought. They shaved off an acre or two, and Norman's group accepted the compromise.

And all of the parties were happy with the arrangements, which led to Wednesday's announcement.

But the beginnings of this complicated and political compromise started many years before MoDOT put pen to paper and before the university announced plans for a research park.

The interchange started with a series of phone calls and meetings. And a feisty Mayor Paul Sander who wouldn't let the project go away.

Coming Tuesday: A look at the earliest beginnings of the interchange concept and how the political support grew over time.

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