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As benefit district policy change discussion continues, citizens voice concerns about usage

“I'm disappointed that there seems to be zero changes to help your constituents."

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A benefit district passed in 2008 will be assessed sometime in the near future for the construction of Cedar Creek Parkway south of College Boulevard, a project that's drawn controversy recently. 

For Anh Vu Rongish, the policies proposed by the city to make stricter rules about benefit districts aren't enough.

That’s what she told the City Council Tuesday during the public comments portion of the meeting before Olathe city staffers continued with presentations about possible revisions to economic incentive programs, including benefit districts. 

Benefit districts are special tax levies charged based on geographic location that pay for infrastructure projects. Residential benefit districts are allowed in Kansas as long as homeowners are alerted to their existence if they move into a pre-established one. The seller is supposed to notify the buyer, but that isn’t always happening, Rongish says. She’s also not sure the proposed changes would really substantially help future homebuyers or stop developers from abusing the practice. 

WHAT’S BEEN PROPOSED? 

There are a few areas of proposed change. Specifically, there are possible limits on who can be included in a benefit district in what circumstances and communication or notification requirements for the city to follow. 

The formation of a benefit district would require signatures of agreement from 100% of affected property owners. Also, platted lots under three acres cannot be subject to benefit districts without the signed consent of the property owners, which would cover most single-family home lots. 

Ron Shaver, the attorney for the city of Olathe, said in October that the proposed changes are purposefully limiting. In that regard, the city does want to make it possible for benefit districts to be imposed, but make it more difficult to establish them, especially in a residential setting. 

"It has continued to narrow the prospect of future benefit districts for residential purposes by design,” he said. 

Another part of the proposed changes to the policies would require the city to take more responsibility for the notification of existing benefit districts. A proposed change to the policy would require the Olathe city government to “post signage adjacent to such district to inform prospective purchasers of property within the district of the existence of the district and where they can obtain additional information about the district.” 

Additionally, in a scenario in which “a benefit district is created, but special assessments have yet to appear on tax bills within the district, the City will, on an annual basis, send a letter to all homeowners of record ... informing all owners of the existence of the district and where they can obtain additional information about the district,” per the city documents. That being said, “[t]he failure of any landowner to receive any such notice will not negate the validity of an otherwise validly (created) benefit district.”

‘I’M DISAPPOINTED’ 

The review of such policies occurs on a regular schedule as they have expiration dates. The benefit district guidelines, however, were not on the list of expiring rules that needed revisiting, but they were pulled out of cycle to review anyway following some “concerns raised by residents,” Mayor John Bacon said in October. 

“I'm disappointed that there seems to be zero changes to help your constituents,” Vu Rongish said. 

City manager Michael Wilkes previously told the council the proposed changes to the existing policy could go a long way to address some of the concerns residents have raised and prevent some of the issues from emerging again.

“What we have done is it effectually, I think will prevent that,” he said. “So that would, in effect, eliminate the possibility of what happened in Cedar Creek, because those property owners wouldn't have signed off.” 

Vu Rongish and her husband moved into the Valley Ridge neighborhood in 2018, and unbeknownst to them, they had moved into a dormant benefit district that was approved in 2008 and hadn’t been assessed yet. Earlier this year, they found out they were about to be assessed $14,000 to pay for the extension of a road they’d never use more than a quarter-mile away from their home. 

They weren’t even aware they lived in a benefit district until a neighbor came around informing them a City Council meeting would be discussing their area’s assessment. Vu Rongish said she’d like to see the practice eliminated entirely. If not, she hopes the City Council will consider policies that make it more difficult for a developer to create a benefit district that goes unassessed for years and is only tapped into once the lots have been sold to unsuspecting individuals. 

‘THE ONLY ONES THAT BENEFIT ARE THE DEVELOPERS AND THE CITY’ 

Denise Holm, who lives in The Meadows at Valley Ridge neighborhood, also spoke at the City Council meeting Tuesday about benefit districts. She’s been assessed $13,000 under a benefit district she was also unaware of, which has left her and other homeowners feeling “betrayed and taken advantage of,” she said. 

“I’m stuck,” Holm said, “but I am concerned about my future neighbors. And actually my neighbors just across the street from me that they'll be roped into the next one.” 

She said she also wants to see the practice of authorizing any benefit districts in residential areas end. 

“The only ones that benefit are the developers and the city, not the current assessed taxpayers,” she said. 

If the usage cannot be totally eliminated, Holm said she hopes the city will require the developer to do more of the communicating. Under the current proposal, Olathe takes a lot of responsibility for disclosure, but Holm said that’s not right either. 

“I would like to recommend that you require the developers to provide a handout at the model homes to each prospective buyer describing what a benefit district is and what the projected amount that they would be required to pay on the property that they're looking at,” she said. “This would allow the ... homebuyers to make an educated decision. This would be full disclosure and place the responsibility on developers and not the city.” 

The benefit district policy and others will be considered at the next City Council meeting on Dec. 7. 

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