COMMITTEE SUBSTITUTE FOR ORDINANCE NO. 050228

Approving an amended and restated plan for industrial development for the purpose of carrying out an industrial development project including the construction and equipping of a facility and lease of the facility to Hearst-Argyle Stations, Inc. for an office building with broadcasting facilities at 6455 Winchester Drive, authorizing an agreement to allow the project to proceed through the issuance of industrial revenue bonds and other matters related thereto.

WHEREAS, the City of Kansas City, Missouri, a constitutional charter city and municipal corporation of the State of Missouri (the City) is authorized pursuant to the provisions of Article VI, Section 27 of the Missouri Constitution, as amended, and Sections 100.010 to 100.200, inclusive, of the Revised Statutes of Missouri, as amended (the Act), to issue its revenue bonds for the carrying out of a project under the Act, such revenue bonds to be paid solely from revenue received from such project, and to enter into a lease of the facilities financed with the proceeds of such revenue bonds with any person, firm or corporation; and

WHEREAS, the City has engaged the Economic Development Corporation of Kansas City, Missouri (EDC) to assist in the marketing, attraction, retention and expansion of existing business, and to attract new business to Kansas City, Missouri; and

WHEREAS, the City, pursuant to the Act and its Chapter 100 Policy, intends to issue and sell industrial revenue bonds in an amount not to exceed $18,000,000.00 (Bonds), to construct and equip an office building and broadcasting facilities at 6455 Winchester Drive (the Project) for lease to Hearst-Argyle Stations, Inc., a Nevada corporation, doing business as KMBC-TV (KMBC); and

WHEREAS, the Project is located wholly within the Winchester Office Center Tax Increment Financing Project (the TIF Project) and is governed by the Winchester Office Center Tax Increment Financing Plan approved by Ordinance No. 911435 on December 19, 1991, as amended, by the Tax Increment Financing Contract between the Tax Increment Financing Commission of Kansas City (TIF Commission) and Winchester Ventures II, a Missouri general partnership (the Developer) dated May 21, 1992, as amended (the TIF Contract); and

WHEREAS, the Council approved Second Committee Substitute for Ordinance No. 040218 on March 11, 2004, approving a plan for industrial development for the purpose of carrying out an industrial development project including the construction and equipping of a facility and lease of the facility to KMBC for an office building with broadcasting facilities at 6455 Winchester Drive, and made certain findings and determinations related to the Project; and

WHEREAS, the controlling state statute for the use of Chapter 100 bonds has been amended to require additional procedural steps, including the requirement that the City shall provide written notice of a project not less than 20 days prior to approval to property taxing jurisdictions in which the project is located;

WHEREAS, the Council approved Committee Substitute for Resolution No. 041033 (the Policy) on September 16, 2004, revising the policy for the use of Chapter 100 bonds and desires to conform to the KMBC plan to the statutory and policy amendments;

WHEREAS, the Councils policy on Chapter 100 financings requires that a company make contract payments in lieu of taxes over a ten-year period to the affected taxing jurisdictions, which contract payments would normally be equal to fifty percent (50) of the real and personal property taxes that would have been due for such ten-year period as a result of the development of the Project; and

WHEREAS, the obligations of the parties to the TIF Contract respecting the TIF Project conflict with the Policy and make application of the Policy impracticable for the Project; and

WHEREAS, as a property and business located within the TIFP, certain agreements have been entered into to provide funding based on the incremental increase in the value of property; and

WHEREAS, in light of the separate agreement for the TIF Project, the City desires to waive the application of its Policy so as not to require real property payments in lieu of taxes to the taxing jurisdictions; and

WHEREAS, the City desires to authorize the Chapter 100 Plan for the Project, to authorize the Director of Finance to execute the certain documents in order to accomplish the purposes both the Chapter 100 Plan and the TIF Plan and which will allow the Project to proceed with the acquisition of equipment and materials on a tax-exempt basis; NOW THEREFORE,

BE IT ORDAINED BY THE COUNCIL OF KANSAS CITY:

Section 1. The Council hereby finds and determines that the Project will promote the economic well-being and industrial development of Kansas City, Missouri, and the issuance of the Citys industrial revenue bonds in a maximum principal amount of $18,000,000 to pay the costs of the Project will be in furtherance of the public purposes set forth in the Act and the Project will promote the welfare of the City and its inhabitants and hereby approves the industrial development plan of Hearst-Argyle Stations, Inc., a Nevada Corporation (KMBC) to construct and equip an office building and broadcasting facilities at 6455 Winchester Avenue, a copy of which plan is attached hereto as Exhibit A and made a part hereof.

Section 2. That the Director of City Development is authorized to execute, on behalf of the City, a preliminary agreement for the construction and acquisition and a sales tax certificate in connection with the agreement to provide for the purchase of equipment for the Project set forth on Exhibit A. The agreement is approved in substantially the form as the agreement on file with the Director of City Development.

Section 3. That the City Attorney, the Director of City Development and the Director of Finance are authorized and directed to negotiate with the appropriate officials of KMBC and, in consultation with the EDC, prepare the necessary documents for the issuance of the Bonds, the construction of the Project and the purchasing of equipment for the Project, and any other documents, for final presentation to and approval by the Council, which documents will provide that payments-in-lieu of personal property taxes as described in Section 5 of this Ordinance will be made by KMBC.

Section 4. That the City Council hereby waives the application of its Policy as to this Project, in recognition of the fact that the City, the TIF Commission, the Raytown School District, KMBC and the Developer have entered into a Tax Revenue Distribution Agreement which requires that KMBC pay an amount equal to sixty percent (60%) of the real property tax increment that would have been paid on the Project except for the approval of the Bonds, and that the TIF Commission direct a portion of such payment to the Raytown School District.

Section 5. That, as a result of implementation of the TIF Project, KMBC shall receive real property tax abatement on the Project in an amount of forty percent (40%). That, as a result of the implementation of the Chapter 100 Plan, KMBC shall receive personal property tax abatement in the amount of fifty percent (50%) over a ten-year period.

Section 6. That the Council reaffirms its findings and determinations and the approvals under Ordinance No. 040891, as approved by the Council on August 12, 2004.

Section 7. That the notices required by the Act, have been given and the County and affected school district have been given an opportunity to comment on the industrial development plan as required by law.

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Approved as to form and legality:

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Heather A. Brown

Assistant City Attorney