Kansas City may spend millions to help private airport parking firm compete with city

The Kansas City Council may spend millions of taxpayer dollars to aid the development of a private airport parking firm that will ultimately compete with the city’s own parking services.

Legislation introduced by three Northland Council members would direct City Manager Brian Platt to come up with a plan to fund and construct two new traffic circles off of Interstate 29 to help the new development about a mile from Kansas City International Airport.

Pat Klein, the city’s aviation director who retires at the end of the month, warned the council about spending city funds to aid the private parking operation.

“I am concerned with the City funding developer’s responsibilities,” he wrote in an email to council members. “It is a precedent that should be looked at extremely closely.”

Richard Chaves Jr. is developing 86 acres near the Ambassador Building, the former headquarters of Farmland Industries at 12200 N. Ambassador Drive. The developer envisions adding new restaurants, retail and offices along with a new Peachy Airport Parking service that would include 4,000 covered parking spaces.

Chaves has been working on the project for the last several years, while also pumping tens of thousands of dollars into Kansas City Council campaigns.

An agreement with the council last year called for the developer to build the new traffic circles as a condition of approval. But the legislation currently pending would ostensibly have the city fund those improvements, which the bill says “are needed due to existing traffic growth in the area, including growth from the new KCI Airport.”

While the new airport terminal opened in late February, city data show traffic at Kansas City International is still rebounding to pre pandemic levels. In March, 943,856 passengers flew in and out of Kansas City International — compared to 1,017,068 who flew in March 2019.

Klein said the intersections and roads in the area are not at or near capacity. He questioned why the city would use its limited resources to improve state-controlled transportation infrastructure. Parking revenues from the city’s airport garage, parking lots and the off-site Park Air Express are the aviation department’s largest source of revenue.

“Parking generates roughly $55M for this airport and having the City participate in funding improvements which will compete with our parking assets doesn’t seem the best use of City funds,” he wrote.

Earlier this month in a council committee, Councilwoman Teresa Loar dismissed Klein’s concerns, saying the aviation director hadn’t been involved in discussions with the developer. Loar, whose council term expires at the end of July, said the body should disregard Klein’s opinions because he is about to leave the city.

“If he wants to run for council and sit up here and make decisions that’s fine. But as an outgoing director of a department who’s leaving on the 31st of May, I’m not sure that his opinion counts down here,” Loar said. “I was the one elected. We were all elected up here to do a job and I’m not sure he’s in a position to sway those opinions in any way.”

But Klein’s concerns did slow down approval. The legislation was held after Kansas City Mayor Quinton Lucas asked the developer to respond to Klein’s email.

Chaves did not respond to multiple requests for comment from The Star.

Though the council has not approved the funds yet, the developer has already begun promoting the new infrastructure.

A YouTube video selling the project already touts a new roundabout bringing “easy highway access.” And the company is planning a groundbreaking ceremony for the project Monday morning. An email invitation from the Platte County Economic Development Council promised attendance by council members and the mayor.

Loar did not respond to a request for comment from The Star. But in committee, the Northland council member said the developer had repeatedly faced obstacles getting the project going over the last few years.

“They have just been piled on and piled on with stuff. And they’re trying to make Kansas City a better place,” she said. “They’ve come in, they’ve brought their money, they’ve tried to develop. And we throw every roadblock in the world in front of them.”

It’s unclear what roadblocks she was referring to.

“I am just so frustrated with this. I started this project when I started this term this time and now I’ve got less than six weeks left and we still haven’t passed it. So I don’t know what it takes to pass a good development in Kansas City, particularly with an individual. I mean these big companies come in and we seem to be OK with all of that.”

‘Development needs to pay for itself’

Formerly the headquarters of Farmland Industries, the Northland office building was purchased by the Chaves family from the city in October 2019.

The family is the latest team to envision a wider redevelopment of the area after plans for developer Wayne Reeder’s Seabiscuit Park fizzled. The Kansas City Business Journal reported that Chaves worked with his father, two aunts and three cousins to acquire the office building and surrounding parcels.

At the time of the sale, the building was about 35% occupied. Now, it’s more than 90% occupied, according to a letter sent to the council from the developer’s attorney. That letter says the Chaves family has already spent $29 million acquiring, rehabbing and redeveloping the Ambassador Building and surrounding property.

In January of last year, the council approved legislation “stating the City Council’s support for improvements” to the Interstate 29 and Cookingham Drive interchange. It directed the city manager to help prepare an application to a cost-sharing program administered by the state transportation department.

Ben McCabe, an area engineer for the Missouri Department of Transportation, said no application was made. And it’s unlikely the project would qualify because there is no underlying transportation need in the area.

“I’m not sure if a development project of this nature would be supported by MoDOT or not. I don’t think it would,” he said.

The site of the future development is already accessible from North Ambassador Drive. That’s just east of Northwest Cookingham Drive’s intersection with Interstate 29. But the developer wants a closer access point for cars getting on and off of the interstate, McCabe said.

“This is being totally driven by the proposed development,” he said.

The only way to add a new access point is with two traffic circles — one north of Cookingham and one to the south, McCabe said. The roundabouts would not disrupt any current interstate access.

Generally, such improvements are funded by developers, not governments, McCabe said.

“I worked for many cities,” he said, “and development needs to pay for itself as it happens.”

Developer pumps thousands into campaigns

Originally based in Dallas, Chaves recently moved to Kansas City as he pursued development of the Ambassador project, according to the Platte County Landmark.

While pursuing the project, the developer has also pumped tens of thousands of dollars into local political campaigns through a political action committee.

Founded in 2018, the Northland Strong PAC was previously affiliated with the Northland Chamber of Commerce.

“To make a long story short, we did not raise a lot of money and there didn’t seem to be a lot of interest in it,” said Edward Ford III, a former City Council member who is on the board of the committee.

Since then, Chaves has taken leadership of the board overseeing the committee and is “no question about it” the largest donor, Ford said. He said the organization aims at increasing voter turnout north of the river as well as supporting police and development.

In a July 2019 quarterly report, the committee reported it had less than $6,500 on hand and only made one donation to mayoral contender Jolie Justus.

That’s changed since Chaves took over.

Earlier this month, the committee reported total receipts of more than $180,000. The PAC has received individual donations, but the largest donors are building trades, construction firms and individuals associated with the Ambassador project.

Already this year, Airport Parking, LLC, the firm that owns the development site, has injected $30,000 into the PAC. The Heavy Constructors Association has donated $50,000.

This year, the political action committee has made donations to Lucas, council member Ryana Parks-Shaw and council contenders Justin Short, Melissa Patterson Hazley, Dan Tarwater, Lindsay French and Theresa Galvin.

Missouri Ethics Commission records show Chaves has also made more than $32,000 in personal political donations to current and prospective City Council members this year.

“His family’s been generous to a number of candidates — both ones that we support and ones that we do not support,” Ford said. “I think they’re pretty good about spreading their money around.”

‘The gateway to the city’

In the City Council chambers last week, the developer’s lawyer said she had not seen the aviation director’s email questioning the ordinance.

Since then, Patricia Jensen, the lawyer representing Chaves, has responded with a six-page memo. In that, she tells the council that the proposed road work “is not a developer responsibility.”

Jensen’s note references previous traffic studies, though those documents are not included with the proposed legislation.

While council documents do not identify the cost of the project, Jensen’s email put it at $5.5 million.

A city spokeswoman said she did not have enough information to answer The Star’s questions about the cost and history of the project.

Jensen argued that other state-controlled roads in the Northland like North Platte Purchase Drive have benefited from city funds in the past. She also said the council should not be swayed by the fact that the development’s new park-and-ride service will compete with the city’s parking services.

“Competition for the airport and its parking should not be used in making the decision on this ordinance,” she wrote. “That would be an unlawful consideration.”

The new Peachy Airport Parking operation is expected to pay $1 million in user fees to the airport, Jensen said. Additionally, the larger mixed-use development is expected to generate $6.7 million in annual sales taxes.

It’s unclear what kind of incentives may be under consideration for the development. A 1% Community Improvement District, a special sales tax for businesses in the area, has already been approved, Jensen said.

In her letter, she said plans for the wider development of retail and restaurants require new access to the site.

“This is the gateway to the city,” she said, “and an attractive and economic development that benefits Kansas City and its citizens should be the city’s priority.”