The tragic story of how Kansas City leaders, blinded by the Wizards’ pro-sports glamour project, turned their backs on an idea that might actually have saved Bannister Mall 

The elevator ascends. John Sharp, a city councilman who represents south Kansas City, is changing floors at City Hall, moving from one meeting to another.

Sharp and his colleagues on the City Council spent 90 minutes at the first meeting arguing about ambulances. One faction of the council wants the fire department to take over the emergency service. Sharp sides with the others, who think the city should continue to use MAST. The discussion produces tension, partly because the city's firefighters are represented by a powerful union that likes to make public officials squirm.

In addition to that drama, Sharp is coping with the sudden disappearance of a $1 billion project from his district.

Earlier in the day, Sharp, Mayor Mark Funkhouser and others met with Cliff Illig, one of the owners of the Kansas City Wizards, the area's professional soccer team. City officials called the meeting to learn what might be salvaged from a deal they thought they had sealed with Illig and his partners.

In 2007, the Wizards committed to building a stadium on the site of the old Bannister Mall. City Hall, in turn, pledged millions of dollars to help build the stadium and surrounding shops, offices and hotel rooms.

It was an ambitious proposal with a lot of moving parts. And as Sharp and others learned last week, it could vanish in an instant.

On Wednesday, September 9, the front page of The Kansas City Star carried the surprise announcement that the Wizards were now planning to build a stadium in Kansas City, Kansas. By dinnertime, representatives of the Wizards and the Unified Government of Wyandotte County had reached an agreement.

Sharp felt betrayed. He lives close to the Bannister Mall site. When the shopping center went into decline, the demoralization reached his front porch. "This is my neighborhood," he says.

Previous revitalization promises had failed, and the Wizards' project looked like certain salvation.

The meeting with Illig, a co-founder of the Cerner Corporation, took place in Funkhouser's office. The mayor poured Illig a glass of ice water.

City officials did not enter the mayor's office from a position of strength. The 2007 agreement with the Wizards had pushed the needle toward reckless. The Finance Department's model indicated that the city stood to lose $41 million when all the pennies were counted.

Yet even at that level of generosity, Kansas City, Missouri, could not match what was being dangled on the other side of the state line.

In Funkhouser's office, Illig told the city leaders that he and his partners remained committed to redeveloping the Bannister site, and building new offices there for the fast-growing Cerner.

"That's what we were told," Sharp says.

Did he believe it?

"That's what we were told."

The elevator makes its climb. Sharp refuses to play the what-if game.

"We offered them everything we had," he says, his voice barely audible above the ambient noise in the elevator car.

To be sure, the Wizards' decision to pull out of south Kansas City is traumatic. But the city's public officials seem poised to learn all the wrong lessons from the experience.

Economic-development boosters in Kansas City, Missouri, complain that their counterparts in Kansas write blank checks to prospective developers. There is some truth to this. The Unified Government authorized $305 million in bonds to assist the construction of the Kansas Speedway and the Village West shopping area.

But it's not as if Kansas City, Missouri, lacks powerful tools. Greg LeRoy, the author of Jobs Scam, a book about corporate subsidies and tax dodges, calls the incentives in Missouri "scandalous."

Kansas City leaders feel hurt and jealous. These emotions obscure the systemic problems that exist in the city's pursuit of developers' dollars, a pursuit that often brings to mind a dog chasing a car.

With the Bannister project, elected and appointed officials turned their backs on the possibility of a different project — one that would have remade the disheveled community into a place worth caring about but would have forced city officials to think about development in new and different ways. Letting pants fall to ankles, they instead took the Wizards' deal because it was the easiest one to comprehend.

A stadium specifically designed for spectators to watch the world's most popular game is, of course, preferable to a dead mall. But the Wizards' leap across the state line might actually have saved Kansas City, Missouri, from subsidizing just a newer, shinier version of the same old problem.

"You want to see Lou's folly?"

Lou Austin, a lawyer and longtime resident of south Kansas City, refers to an ATM machine. Several years ago, he installed the cash dispenser outside the retail office building that his parents built. What's left of the ATM is a slab of concrete. Austin removed the machine after someone bombed it in a failed attempt to abscond with its contents.

Austin had spent $50,000 on the ATM, anticipating an influx of visitors to Bannister Road, which his family's building fronts. The source of his excitement? In 2000, representatives of Bass Pro Shops, the outdoor retailer, were considering Bannister Mall as a possible location for a new store.

By the time the deal fell through, the entire experience could have been called Chuck Eddy's folly. For then-councilman Eddy and other City Hall leaders, it turned out to be a lesson in the danger of hoping that a corporate glamour tenant would miraculously save Bannister Mall.

Economic-development officials in Kansas City put together an incentive package worth $31 million in an attempt to convince Bass Pro of Bannister Mall's merits. The shopping center, which opened in 1980, needed the boost.

Enclosed regional shopping centers have short life spans — a study found that 19 percent of the malls in America are dead or dying. Fears about crime had hastened Bannister Mall's inevitable decline. Bannister Mall's reputation was such that the Economic Development Corporation, a city-funded agency, hired a statistician to show Bass Pro that the Bannister area was no more dangerous than other parts of the metro.

But the incentive package and the crime data fell short. The deal collapsed when the mall's owner, an investment company, got antsy about its $30 million commitment to the Bass Pro-anchored renovation.

Austin's ATM was worthless. "I took a bath," he says.

Around the time of the Bass Pro courtship, Austin and other property owners in the area had begun to think about ways they could improve the area's fortunes without having to rely on the whims of mall owners and chain stores.

There was a time when south Kansas City was considered desirable. But its ranch-home subdivisions, typical of those built in the 1960s, have aged poorly. Public schools that used to operate in split shifts to accommodate new families are now seen as a reason to settle elsewhere.

Looking for expertise, Austin met with longtime Kansas City developer Hugh Zimmer. Zimmer told Austin that he needed a plan.

Austin, who at 61 carries little of the flab that men tend to accumulate with age, knew what he didn't want in the plan: the big, beige box stores that composed Bannister Mall and its satellite strip centers.

Austin decided that the future was in New Urbanism.

New Urbanism is essentially a repudiation of postwar suburban sprawl. Its promoters believe in walkable neighborhoods. The movement encourages cities and developers to stop thinking that work, school, worship, leisure and home life belong in segregated areas, accessible only by car.

New Urbanism had entered the mainstream by the time Austin was trying to piece together the bigger picture. In 1995, Newsweek had run a cover story, "15 Ways to Fix the Suburbs," outlining the virtues of corner stores and skinny streets.

Austin needed a pulpit from which to advance his ideas. Working with the Economic Development Corporation and his representatives on the City Council, he structured a community-improvement district. Property owners within a CID agree to a special tax on their properties or sales, then spend the extra money on infrastructure and services beyond what cities can provide.

The Bannister Road CID took the name 3-Trails Village — a celebration of the Santa Fe, California and Oregon trails used by pioneers. The trails were a nice hook and a way to obtain grants. Federal highway-beautification money helped place metal sculptures of buffalo and cowboys on the grassy area between the mall and Interstate 435. "The [CID] board wanted to rebrand the area," Austin says.

A new brand was necessary. Austin, who would become the chair of the CID, says south Kansas City had formed its identity around Bannister Mall, and it was a false identity. At its core, a shopping center is a means of making money. Even in good times, a mall should never define a neighborhood.

Bass Pro, then, was really just another mask for south Kansas City to wear. "We can't admit who we are," Austin says. "We chase dreams."

Austin wanted something that was more substantive.

In 2003, Gary Sage, a senior vice president at the Economic Development Corporation, stressed to Austin the importance of developing a master plan. In a letter, Sage wrote that a master plan could provide a "framework for leveraging ... development opportunities into maximum benefits for the area, surrounding neighborhoods and the city as a whole."

Austin took Sage's words to heart — only to watch city leaders ignore his efforts.

Since its inception, Major League Soccer has struggled to capture the attention of American sports fans. Accounts of games tend to appear in the rear of sports sections. Its TV presence is minimal.

The league has had better luck socializing its costs. Several teams play in publicly funded stadiums.

Major League Soccer clubs have had success with their stadium drives by attaching their desires to youth soccer. In three cities, new soccer stadiums were bundled with youth fields and other "participation assets" in an effort to make the projects seem more worthwhile to the public.

When he put the Wizards up for sale in 2004, Lamar Hunt instructed potential buyers in Kansas City to lock in a stadium deal. Hunt had watched the Wizards get swallowed up in cavernous Arrowhead Stadium. (The Wizards' current home is CommunityAmerica Ballpark, a baseball stadium at Village West.)

OnGoal LLC, the Wizards' current ownership syndicate, bought the team from Hunt in 2006. The principals include Illig and Neal Patterson, the chairman of the board at Cerner, a provider of health-care information technology. Cerner's value is more than $5 billion.

At the same time that OnGoal was negotiating to buy the Wizards, officials in Johnson County were putting together a proposal to build a $75 million soccer park in south Overland Park. OnGoal let it be known that it wanted to build a stadium at that site (revenue source: to be determined) if voters in Johnson County approved the plan.

Johnson County voters gave the idea a resounding "no" on November 7, 2006. The following week, it was reported that OnGoal was considering Bannister Mall, among other sites.

OnGoal made its interest in south Kansas City official in April 2007. In cooperation with LANE4 Property Group Inc., OnGoal applied for tax-increment financing, a program administered by the Economic Development Corporation.

TIF allows developers to capture a portion of the taxes that their projects create. A powerful tool, TIF was designed to lure developers to distressed or blighted areas. In Kansas City, though, developers have used it to build shopping malls and condominiums in the city's wealthier precincts.

Following the example of other MLS owners, OnGoal proposed more than a soccer stadium. The plan also included 12 "tournament style" soccer fields, a hotel, retail stores and office space.

OnGoal and LANE4 put the project's value at $943 million. They wanted TIF to cover $267 million. Aaron March, a lawyer with a reassuring mien, told the TIF Commission that the development represented Bannister Mall's "salvation."

Even critics of the use of TIF in Kansas City had to admit that the plan had merit. Bannister Mall was genuinely blighted. Soccer proposed a cure.

Of course, soccer's viability as a spectator sport in the United States remains a work in progress.

As LANE4 prepared the Wizards' proposal, English superstar David Beckham joined the Los Angeles Galaxy, an MLS team. League officials hoped that Beckham's stateside arrival would captivate celebrity watchers as well as sports fans who resist Major League Soccer because they know the best players are in Europe, competing in the Champions League.

Alas, Beckham's heavily promoted Galaxy debut did not land with the desired impact. A recently published book called The Beckham Experiment notes that the ESPN2 audience for Beckham's first game was smaller than the one that had tuned in to watch a women's softball game the previous month.

While Kansas City's economic-development whizzes had been bending over for Beckham, they missed another opportunity — an opportunity that looked as if it had solid financial backing and forward-thinking planning. Had locals not been so myopic in their focus on the stadium as savior, they might have remembered the lessons of Bass Pro.

In a space rented cheaply from Austin, the office of the 3-Trails Village CID succeeds in transmitting the idea that stagecoaches used to drive over what is now 93rd Street. Cattle skulls hang from the walls. A checkerboard waits for players to grab a stool. Some of the American flags reflect the gradual nature in which states joined the union. "This is our sales room," Austin says.

The CID board meets in a room furnished with church pews. Austin believes the pews increase the dignity of the discussions that take place. "When you raise the bar, you affect human behavior," he says.

One behavior that the CID has tried to influence is the manner in which cars and trucks use 87th Street.

In 2003, the CID hired a transportation engineer, Michael Wallwork, who specializes in roundabouts. Advocates of New Urbanism like roundabouts, which calm traffic and create visual interest. Wallwork proposed four roundabouts for 87th Street in an effort to transform the road "into a beautiful, appealing, public space that will spark redevelopment interest," according to his feasibility study. Wallwork also suggested ideas for improving Bannister Road, which he called "unattractive" and "designed solely to move vehicles."

The 3-Trails Village board also invited professional and student landscape architects to reimagine Bannister Mall and its surrounding acreage. Austin liked the plans that showed houses and apartments where empty stores and parking lots stood. "You gotta have people living on the dirt," he says.

Rethinking Bannister Mall was not simply an academic exercise. In cities such as Lakewood, Colorado, and Boca Raton, Florida, dead malls have been converted into graceful districts with a mix of uses. Robert Gibbs, a Michigan-based retail urban planner in the New Urbanism school, told Austin that Bannister Mall had the right bones — primarily land and access — for that sort of redevelopment.

Through Gibbs, Austin met a possible investor for such a turnaround here.

In the fall of 2007, Gibbs helped arrange a visit by two senior executives at J.P. Morgan and the managing partner of GreenHawk Partners, a North Carolina real-estate development company.

The J.P. Morgan executives managed the bank's Urban Renaissance Property Fund. The fund managers sought investments in developments that adhered to "green" certification standards, pedestrian-friendly design and proximity to commuter rail lines, according to a letter that one of the executives, Lewis Jones, sent to Austin.

On his visit, Jones wanted to meet officials from Kansas City Southern. The railroad's main line forms the eastern border of the 3-Trails Village CID.

A Kansas City Southern spokeswoman confirms that the company's vice president for corporate affairs, Warren Erdman, met with Austin and others to discuss the possibility of commuter rail service, which transit advocates in Kansas City have promoted for years.

The spokeswoman, Doniele Kane, says Erdman expressed the railroad's "willingness to consider such an idea," while also explaining that the track required substantial improvements in order to handle commuters as well as freight, and that the money would have to have come from a public source.

That year, gas prices surpassed $3 a gallon. Austin says the J.P. Morgan executives were looking to invest in developments that could survive in a world of reduced automobile travel.

The bankers held four meetings in Kansas City that were attended by various stakeholders, including the public.

A private meeting was arranged between representatives from J.P. Morgan and LANE4 Property Group, OnGoal's development partner.

The Wizards and LANE4 had already outlined their vision for the site several months before J.P. Morgan took an interest. It was green only in the sense that it contained sports fields.

Aspects of LANE4's plans for Bannister Mall look pretty similar to what was at the site 20 years ago. Where the shopping center once stood — demolition began earlier this year — the drawings call for big-box and specialty stores, surrounded by acres of ample parking. The streets are engineered to facilitate speedy access to and from the soccer stadium.

Of course, the youth soccer fields and the office buildings would have added dimensions that Bannister Mall lacked even in its glory years.

At the same time, LANE4 was not assembling a development to rival the Country Club Plaza — or even Zona Rosa. The retail and office components in LANE4's plan existed largely to create a tax increment to pay for the construction of the soccer stadium.

"The driver," Austin says, "has always been, 'We want a stadium.'"

It became evident to Austin that the Wizards/LANE4 team and J.P. Morgan would not be able to align forces.

J.P. Morgan's ideas about redevelopment fit with all the planning that 3-Trails Village had done. J.P. Morgan's pledge to invest in sustainable design squared with public officials' stated intentions to make Kansas City a greener place.

The soccer-oriented plan, however, had been the first to lay claim to the site — and make political friends. Sharp has received $1,000 in campaign contributions from OnGoal as well as LANE4, according to campaign-finance disclosures.

And though the visit from and meetings with J.P. Morgan representatives indicated that the investor had a strong interest in Kansas City, discussions never progressed to the point of a financial commitment.

Meanwhile, the Wizards were prepared to throw around a little Cerner money. "You can't turn that down," Councilwoman Cathy Jolly tells The Pitch, in an effort to describe the bird-in-hand nature of the soccer plan.

Owen Buckley, the president of LANE4, says the Wizards group spent $30 million acquiring and preparing the ground around Bannister Mall before the team turned to Kansas City, Kansas.

Still, Austin is annoyed. He feels that 3-Trails Village followed the Economic Development Corporation's every instruction, only to be discarded at the first bounce of a hypothetical soccer ball.

"It was like we never even existed," he says.

Soccer's future in south Kansas City dimmed when investment banks began to choke on the bad bets they had made on goofy home loans.

In December 2007, the same month that the City Council approved the incentives for the Wizards' project, Bear Stearns announced that it had lost $854 million in just three months. It was as an early signal that Wall Street was headed for trouble.

"Our world really started changing," Buckley says. Credit markets seized up. Buckley says his team spent much of 2008 scrambling to keep things together. At one point, LANE4 asked the city to back the TIF bonds. City officials declined.

The Wizards, in the meantime, were anxious for work to begin on their stadium.

"They're a restless group, as you've seen," Buckley says. "They want a stadium yesterday."

The owners of Nebraska Furniture Mart at Village West made an overture to the Wizards in April of this year, Buckley says. The appeal of Kansas City, Kansas, quickly became apparent.

The furniture store offered the Wizards land on which they could build their stadium. Accepting the offer meant that the Wizards wouldn't have to fuss with lining up sales- and earnings-tax-producing tenants at the Bannister site. Stores at Village West were already added established and were producing the tax revenue that the Wizards need to back their stadium bonds.

Team officials hope to open a new facility in 2011.

"What's important to us and really to our fans is making sure we're in a soccer stadium and in a soccer stadium as soon as possible," Wizards President Robb Heineman tells The Pitch.

Heineman and Buckley say they still believe in the Bannister area. Of course, they now own 200 acres out there. Optimism came with the deed.

"We're going to make sure something wonderful happens out there," Heineman says. "We owe it to the community; we owe it to ourselves. But at the end of the day, we owed it to our fans to make sure we're in a soccer stadium, and that's the move we made."

Austin says he doesn't fault the Wizards for pursuing their interest. He does wish the CID had been more effective in getting them to think more about a plan that included the stadium but was not built around it. "We didn't do that," he says. "It's inexcusable."

Now, once again, the Bannister site is open to development ideas.

Is there a chance that J.P. Morgan execs might come back for another walk around the grounds?

"Investors are always looking for opportunities," Austin says. The vagueness of his reply suggests that investment bankers will not be sitting in church pews anytime in the near future.

Economic-development "leaders" in Kansas City, meanwhile, are recommencing their efforts to save the Bannister site. Maybe this time they'll look for a solution instead of a miracle.

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