Tax district sought for streets, lights near SportsPlex

Midamerica Hotels Corp. has petitioned Cape Girardeau County Circuit Court to establish a sales-tax-funded transportation-development district.

It would be the first such taxing district established in the city of Cape Girardeau, deputy city manager Molly Hood said.

Joel Neikirk, Midamerica vice president, said the company has begun construction of a new section of Veterans Memorial Drive that would let the company develop vacant land it owns along Interstate 55 near the Cape Girardeau SportsPlex being erected.

The district, which would be known as the Midamerica Crossings Transportation District, would encompass about 83 acres, including 76 acres north of U.S. 61 and east of I-55 and seven acres on the south side, said local attorney John Grimm who filed the petition on behalf of Midamerica Hotels.

The transportation development district, or TDD, would provide a funding mechanism to recover the cost of constructing Veterans Memorial Drive in a northwesterly direction from Limbaugh Lane, as well as accompanying grading, curb and gutter, sidewalk, drainage and lighting improvements. It also would finance future installation of traffic signals at the Limbaugh Lane, Veterans Memorial Drive and U.S. 61 intersection, according to the petition.

Hood, the deputy city manager, said there is no timetable for installing traffic signals, which would need approval from the Missouri Department of Transportation.

At this point, there is not enough traffic to warrant erecting traffic signals, Hood said. But she said that could change with commercial development.

The project is expected to cost more than $9 million, which, besides street-related work, would include landscaping, signs and a water feature at Veterans Memorial Drive and Limbaugh Lane, the petition states.

Construction of this section of Veterans Memorial Drive is projected to cost more than $1.8 million, according to court documents. Future traffic signals are estimated to cost $1.25 million.

Total construction costs are budgeted at more than $3.3 million. Another $3.3 million is budgeted for administrative, engineering and other costs. Donated land and right-of-way costs are projected at $2.36 million, according to the petition.

Construction of this section of Veterans Memorial Drive is on the city’s capital improvements plan, but Hood said the city doesn’t have funding for the project right now.

Establishment of a TDD would allow the road to be built sooner.

“We think it is absolutely a great tool for this purpose,” Hood said.

The district would be operated by a five-member board of directors who initially would serve staggered terms. Subsequently, all members would serve three-year terms.

State law allows TDDs to levy sales taxes up to a maximum of 1 percent in a district. Midamerica Hotels would have the only vote to establish the sales tax as no registered voters reside in the planned district, according to the petition.

According to documents filed with the court Oct. 6, Midamerica envisions a commercial development on the now vacant acreage that could include a hotel, convenience store, a couple of restaurants, including a fast-food restaurant, and a retail strip center.

Neikirk said the sales tax would be levied only after businesses have been established. While there is no timetable, he said it would be an “ideal scenario” to develop such commercial businesses over the next 10 years.

Building the street is the first step, he said, adding it provides greater access to the SportsPlex, slated to open next year.

The proposed sales tax would generate an estimated $100,000 annually from $10 million in gross sales, including $3.5 million from a hotel, court documents show.

Under state law, a TDD can issue bonds, notes and other obligations for up to 40 years.

But Grimm, the attorney, said the board could dissolve the district as soon as it recovers the improvement costs. Even so, Grimm said it would be “many years down the road” before Midamerica will have recovered its costs.

“I don’t think it would be there forever,” Grimm said of the district.

In accordance with state law, both the city of Cape Girardeau and the Missouri Department of Transportation have to sign off on the TDD proposal, Grimm said. Both government entities are named as respondents in the petition.

Judge Michael Gardner will rule on the petition. Grimm said he hopes the judge will approve the TDD request before the end of the year.

While a TDD is new to Cape Girardeau, Grimm said such taxing districts, allowed under a 1990 state law, have been used extensively for developments in the St. Louis area and other parts of the state.

He said the proposed TDD would not reduce tax revenue for the Cape Girardeau public schools or city government.

mbliss@semissourian.com

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