Wyandotte County, the unhealthiest in Kansas, considering a grant to fund Pizza Hut, Wendy’s and Dunkin’ Donuts in Argentine

When a report surfaced in 2013 that named Wyandotte County the unhealthiest among Kansas’105 counties, political leaders there said they wanted to reverse that dubious distinction.

Now, however, they’re considering a handout to close a development financing gap for three fast-food chain restaurants in Argentine.

Ferguson Properties, a developer based in Liberty, has a $3.3 million plan to build two restaurant buildings at 18th Street Expressway and Metropolitan Avenue. One would be a combination Wendy’s and Pizza Hut; the other one would be a stand-alone Dunkin’ Donuts. Backers of the development hail the Wendy’s-Pizza Hut combination as a first-of-its-kind development, distinct from the Pizza Hut-Taco Bell outlets and the Pizza Hut-Taco Bell-Kentucky Fried Chicken shops that well-traveled fast-food connoisseurs can find elsewhere.

The project would be built on a sliver of land along 18th Street Expressway, across the street from the Save-A-Lot discount store. The land is owned by the Kansas Department of Transportation, a state agency that’s looking to make a deal.

Ferguson Properties has learned that it can get a $1.5 million private loan and has access to $1.2 million in federal grants earmarked for low-income job creation. That leaves the developer about $550,000 short of its $3.3 million goal. Ferguson wants the remaining money to come from a new economic development fund that the Unified Government of Wyandotte County/Kansas City, Kansas, Commission approved for the first time in its current budget.

Korb Maxwell, a Polsinelli attorney representing Ferguson Properties, said the developer would be getting a bargain on the land. “We have almost no land cost on this,” he told the UG Economic Development and Finance Committee Monday night.

So what’s the problem for Ferguson Properties? Maxwell told the UG that preparing the site for development will carry a hefty price tag.

The $3 million fund Ferguson means to tap into is meant to dole out grants to help development projects that came up short in their financial pro formas. The UG has established no real criteria or policy to govern what types of of projects should be eligible for the fund, or who should vet them and how. The Ferguson Properties proposal is the first request for money out of this $3 million fund, which the UG plans to fund by issuing debt.

“I am disappointed that we are issuing debt for this,” said 2nd District UG Commissioner Brian McKiernan last night. “I had envisioned a cash fund that we would spend down … I’d love to have a pool of cash, not a pool of debt.”

Seventh District UG Commissioner Jim Walters suggested that some kind of review process was probably necessary to vet applicants to this economic development fund.

“I think when [UG County Administrator] Doug Bach proposed this, one of his fears was, once we establish a gap fund, every project will have a gap,” Walters said. “So I think we will need to do some analysis somehow — find a third-party review board of some kind is probably appropriate.”

Commissioner Ann Murguia, whose 3rd District covers most of Argentine, worried that taking time to come up with a policy for how private companies can get public dollars would scare off the fast-food purveyors.

“I would say as a novice developer, I would tell you if we get caught up in trying to answer all these questions before we bring this deal forward for approval or denial, we will lose the deal,” she said.

She suggested that these types of gap-financing requests might not be as necessary if developers didn’t have to pay development attorneys by the hour while the government figures out policies: “One of the ways we can decrease this gap is, instead of having development lawyers like Korb, who are paid by the hour, come forward repeatedly while we develop a policy around a situation, we allow some situations to become pilots and we learn from them as we move along.”

No vote was held on Monday evening, only discussion about the Ferguson Properties proposal and the development fund more broadly. Nothing was said about the health implications of adding a trio of fast food restaurants — one of which sells a sandwich called a Baconator, which tops 960 calories before you even touch the fries — in a county that’s teetering on the brink of a health crisis. 

Maybe that topic will come up this summer when the project resurfaces before the UG Commission for a vote. If the proposal receives the $550,000 in gap financing from UG, that means that more than half of the $3.3 million project cost will come from government sources, after the federal grants are factored.

“The project itself stands on its merits,” said UG director of economic development George Brajkovic.

Merits, and a stack of government money.

Categories: News