City Beat: Council refines medical marijuana ordinance

Craig Hosmer: Amendment 2 was sold to voters with a 1,000-foot separation requirement.

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Council receives update on TIF districts

During the April 22 City Council meeting, Economic Development Director Sara Kerner updated council members on Springfield’s three tax increment financing districts, in accordance with statutory requirements for TIFs.

Through $4.4 million generated by the TIFs combined at the end of 2018, the three districts are seeing promised development.

The longest running TIF, on Commercial Street, was approved in 2008, but the most financial activity has occurred in the 2010-authorized Jordan Valley Park TIF, according to Kerner’s report. The newest TIF is at Springfield Plaza, established in 2013.

Jordan Valley Park’s TIF contains eight redevelopment project areas.

In 2018, the Jordan Valley TIF collected $2.28 million in payments in lieu of taxes, aka PILOTs, and $341,547 in economic activity taxes.

“All of those funds go to reimburse the city for bonds on the Expo Center,” Kerner said. “Each year, we pay down basically the new funds that have collected and we leave a small balance.”

The Jordan Valley TIF’s current balance is $20,288.

On Commercial Street, running from Douglas to Clay streets, Kerner said the TIF’s primary purpose is to carry out extensive public improvements and encourage growth. For instance, design and construction work for the public parking lot at Jefferson Avenue and Blaine Street has been completed. Other plans include public restrooms and Blaine Street improvements.

Kerner said roughly $520,000 from the TIF budget was approved last year for spending.

The Commercial Street TIF last year collected roughly $900,000 in PILOTs and $25,798 in economic activity taxes.

The Springfield Plaza TIF, southwest of the West Bypass and Sunshine Street intersection, has two project areas. The district has more than 430,000 square feet between both areas for commercial uses, though more than half has yet to be developed, according to city documents.

During 2018, the Springfield Plaza TIF collected $923 in PILOTs and $317,036 in economic activity taxes. It holds a current balance of $75,760.

“2018 property taxes mostly came in 2019, so that’s why the PILOT number is very low,” Kerner said.

The Springfield Plaza TIF went into effect in December 2016, and the 96-acre retail development’s first stores opened in summer 2018. The funds have been used to reimburse the developer for public improvements, paving the way for Burlington Coat Factory, Ross Dress For Less and Shoe Department Encore to open.

The goal of TIF districts is to eliminate adverse conditions, including barriers to safety and public health; enhance the tax base; encourage private investment and stimulate development; and increase employment and housing opportunities, Kerner said.

Medical marijuana was a central talking point at the April 22 City Council meeting, with two amendments proposed to refine the permitted locations of certain facilities in Springfield.

Council members held a first reading on a proposed medical marijuana zoning ordinance at its April 8 meeting. The ordinance was slated for a vote April 22 but a reintroduced amendment delayed the action.

Councilman Craig Hosmer again made a motion to amend the medical marijuana ordinance, seeking a broader definition of child care centers and longer distance requirements. Hosmer’s proposal includes all day care centers regardless of licensing from the city or state, but his bigger point in the amendment is to establish a 1,000-foot separation requirement – up from 200 feet – between medical marijuana dispensaries and post-extraction facilities and schools, day care centers and churches.

Currently, city staff recommends a 200-foot separation since the downtown area would have few or no dispensaries under a 1,000-foot separation requirement. The facilities may include medical marijuana bakeries, confectionaries or producers of ointments and other marijuana-infused products.

While a similar amendment failed at the April 8 meeting, Hosmer said April 22 he was reintroducing it because Councilwoman Jan Fisk was absent from the previous meeting and newly elected Councilman Abe McGull was not yet in place.

“I’m not against medical marijuana at all, but I think the people in the state of Missouri, when they voted for Amendment 2, the amendment was sold as a 1,000-foot separation from schools and day care facilities,” Hosmer said while introducing his amendment.

Fisk followed with an amendment of her own. She sought to remove Hosmer’s definition of day care centers, instead keeping the definition of a day care center as licensed by the city or state. Her amendment left the 1,000-foot separation requirement proposed by Hosmer.

Attorney John Price took issue with the separation requirement.

At his Carnahan, Evans, Cantwell & Brown PC law office, Price works with clients preparing to apply for dispensary licenses. Some have identified a location and are in talks with a landlord, but the property is less than 1,000 feet from a church that’s considering adding a day care, putting the deal on shaky ground.

“It throws uncertainty and unpredictability into some very serious business decisions,” Price said.

Fisk’s amendment to Hosmer’s motion failed by one vote, with council members Fisk, McGull, Andrew Lear and Matthew Simpson voting in favor.

Hosmer’s amendment passed 6-3, with Lear, Fisk and Simpson in opposition.

Council is scheduled to vote on the amended bill May 6, with a public hearing for the amendment also scheduled.

Council also tabled a second medical marijuana bill until May 6 regarding the adoption of a $108 fee for a medical marijuana zoning certificate. The fee would have a $92 base rate and a 17% technology fee collected by the Planning and Development Department. A standard real estate zoning certificate costs $44, according to city documents.

The city anticipates 50 zoning applications generating roughly $5,400, which would funnel into general revenue, said Mary Lilly Smith, the department’s director.

Loan regulation permits
Council also considered new regulations for payday loan establishments that drew 12 speakers during the public hearing.

The bill proposes requiring a permit for each of the 26 payday loan locations in Springfield within 60 days of passage. The permit then would be renewed annually at $5,000, said City Attorney Rhonda Lewsader. The permit would carry a $2,500 fee, if less than six months remain in the year at the time of filing, she said.

Councilwoman Phyllis Ferguson was concerned the imposed fee would be passed on to those who use the service. The bill, recommended by the city’s Finance and Administration Committee, would apply to check-cashing stores, payday loan services and car title loan businesses.

Among the public speakers, most had personal experiences with payday loans.

Springfield resident Kathy Lutz told council she took out a title loan on her car and payday loans to fund a trip to St. Louis for a medical procedure.

“The interest rate on the title loan alone was 412%,” she said. “I strongly encourage anybody listening – find any legal means to fund what you need, but do not get a payday loan or title loan because it will put you into a debt trap you will never get out of without help.”

The city cannot dictate the interest rates charged by the companies; only the state has the power to do so under the Hancock Amendment in the Missouri Constitution, which limits the amount fees and taxes can be increased.

Under the bill, the permitted companies must provide customers a city-approved guide regarding alternatives to short-term loans. It also outlines penalties of a $500 fine and/or 180 days in jail, Lewsader said.

Lewsader said the fee does not qualify as a “true user fee” under the Hancock Amendment, and it would be considered a tax put before voters. The maximum that could be collected through the fee is $130,000 annually, and the money would go into general revenue, Lewsader said.

A substitute bill, which did not assess a permit fee, also was introduced. If council approves either bill, it would go before voters for adoption.

Other notes
• Councilwoman Ferguson was nominated for mayor pro tem and unanimously voted in.

• Two rezoning bills passed. One for 40 acres for Ozarks Coca-Cola/Dr Pepper Bottling Co.’s plant expansion, at North Packer Road and East Blaine Street, and another by Springfield Public Schools for an acre the district plans to sell, at 529 W. Division St.