During the Feb. 3 Olathe City Council meeting, the Governing Body intends to conduct a public hearing and vote regarding the STAR bonds project involving the Kansas City Chiefs practice facility and headquarters. As outlined in the proposed Ordinance No. 26-06, the City of Olathe could pledge local revenues from sales tax from the base revenue area to support repayment of the bonds to be issued by the Kansas Development Finance Authority (KDFA) in the following methods:

• For a period up to 30 years, until the STAR Bonds are retired, sales and use taxes generated within the base revenue area (map below) from the City’s 1% general sales tax and use tax not already committed to other uses. If not for this project, there would be no sales and use taxes to available dedicate to the repayment of the bonds.
• For a period up to 30 years, until the STAR Bonds are retired, sales and use taxes generated within the base revenue area from the City’s portion of the Johnson County sales tax not already committed to other uses. Again, if not for this project there would be no sales and use taxes available to dedicate to the repayment of the bonds.
• For a period up to 30 years, until the STAR Bonds are retired, 7% of the 9% of the Transient Guest Tax generated within the base revenue area from sleeping accommodations at any hotel, motel, or tourist court within the project area. As there is vacant property, if not for this project there would be no Transient Guest Sales tax revenue available to dedicate to the repayment of the bonds.
• The sole area affected by the above pledges includes certain land located at the northwest corner of College Boulevard and Ridgeview Road.

Information for Olathe Residents

• This ordinance does NOT include pledged revenue from the City’s street maintenance sales tax (0.375%) and park sales tax (0.125%) and any other retail sales and compensating use taxes that are committed to other uses by election of voters. Any new sales tax revenues generated from this project for these special sales taxes will be available immediately to invest back into the City’s streets and parks.
• The City of Olathe is NOT agreeing to issue general obligation debt backed by the taxpayers of the City, and the bonds will NOT be considered a debt or liability of the City.
• Any current existing revenues and new revenues generated from ancillary developments beyond the project area will be retained by the City of Olathe. The sole source of Olathe’s contributions to support repayment of the STAR bonds to be issued by the KDFA are new sales and use taxes generated within the project area located at the northwest corner of College Boulevard and Ridgeview Road.
• The Olathe portion of current and existing sales and use taxes outside of the project area will NOT be used for repayment of bonds. STAR bonds are repaid only from new general sales tax generated within the STAR bond district that otherwise wouldn’t have been collected if not for the investment in the development.      

What Happens Next

What would follow the Feb. 3, council action would mirror standard City processes including detailed financial analysis and independent revenue studies, land use, zoning, and design review, additional public meetings, and multiple City Council approvals to make land use and site plan decisions and adopt formal development agreements. The City also anticipates entering into a formal development agreement with the Team for the Olathe portion of the project.