No Bailout for RED

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"Cities are better off with a stalled project than a bankrupt city, if a project needs that kind of support, it needs to be baked further. It needs more time."

- Dan Lowe, managing partner and co-founder RED Development in the Kansas City Star article:

Finding financing, attracting retail tenants double whammy for developers
by KEVIN COLLISON, The Kansas City Star, December 9, 2008

Watch the 10 minute short documentary "Developing Debt: A RED Economy"

Then click on the "do something" tab above to learn what you can do!

LEE'S SUMMIT APPROVES 9-MILLION DOLLAR BAILOUT

For the first time in the City's history, Lee's Summit taxpayers are going to foot the bill for a direct government loan to help bankroll a private project. Ignoring concerns over risking public tax dollars, City Officials in Lee's Summit voted to move ahead with plans to loan nearly $9-million dollars to a private developer.

Last night the City Council voted five to four to approve the loan to RED Development, which is the company building the Summit Fair Shopping Center. RED has already gotten the City to agree to issue 23-million-dollars of TIF bonds on the project early. Then, RED went back to the City and said it still couldn't finish the project without additional government backing.

City Council members were split evenly on whether to consider the bailout when the idea was first presented five weeks ago. As she did five weeks ago, Mayor Karen Messerli broke the Council's tie by voting yes on the bailout.

This is an unprecedented move in Lee's Summit, as never before has the City provided a loan for the benefit of a private developer.

Summit Fair Center had been scheduled to open this summer with Macy's and JCPenney's as the anchor tenants. City staff who analyzed the risks associated with a public commitment to the project said there were no guarantees that all the conditions would be met that would be required to bring both stores into the center.

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