STAR bonds retired on Village West development ahead of schedule

The final payment on state-backed bonds relied upon to develop the Village West shopping district in Wyandotte County was made five years ahead of schedule Dec. 1, officials said Thursday.

The STAR bond program provides upfront cash for entertainment or tourist developments repaid with local and state sales tax revenue generated by the projects.

Retirement of STAR bonds for the Village West development in Wyandotte County is expected to free $12 million in sales tax revenue annually for use by the Unified Government of Wyandotte County-Kansas City, said Mike Taylor, spokesman for the Unified Government.

Taylor said the state government could receive $42 million annually in sales tax revenue from Village West starting in January.

Disclosure of a plan under consideration by Gov. Sam Brownback to redirect that revenue to a new STAR bond package to relocate the American Royal across the state line from Kansas City, Mo., inspired the 2016 Legislature to seek a temporary restraint on new STAR bonds in Wyandotte County until mid-2017. Brownback vetoed that restraint and the Legislature declined to override him.

The Kansas Department of Commerce possesses authority to decide what municipalities and developers receive the incentive.

In October, Brownback administration officials said their strategy was to invest up to $80 million in STAR bonds over a 20-year bond term in a new American Royal complex to be constructed near the Kansas Speedway and estimated to cost $160 million.

Reliance on STAR bonds to promote economic development has been questioned by state legislators searching for revenue to fill shortfalls in general state tax revenue. The 2017 Legislature and Brownback face a $350 million gap between projected revenue and expenses in the current fiscal year.