A local project manager asked Ballwin aldermen this week to consider approving a tax incentive for new businesses he's overseeing due to unforeseen development costs.
The project , which is scheduled to include a Wendy’s restaurant, a U-Gas convenience store and one other business, is on track for completion regardless of whether a tax incentive is approved, said project manager Bill Biermann of W.B. Biermann in Chesterfield.
Biermann, whose current projects also include an being constructed near Henry Avenue and Clayton Road, said the Wendy’s-U-Gas development encountered unforeseen costs. That included transportation expenses for dirt removed during the excavation process of the site, which requires demolishing the now-closed .
"We don’t know the exact number, but I will tell you that we would look for our (total development budget) at approximately, give or take, around $1 million," Biermann told aldermen Monday. "And we’re confident that with the sales (generated by) our two users, we could cover that within a reasonable amount of time."
The transportation development sought by the developer or TDD, as defined by the Missouri Department of Economic Development, "serves to fund, promote, plan, design, construct, improve maintain or operate one or more projects," through special assessments or the use of additional sales taxes. The application of a TDD at the proposed site would place an additional 1 percent sales tax on all transactions within the district.
Biermann said the improvements would occur within the district, namely in the form of a new "leaderboard" sign for the city and through the installation of new street lights along Seven Trails Drive near Vlasis Park.
Biermann said he researched the cost of also installing more sidewalks near the businesses, but decided against it due to cost.
"We’re already having trouble covering up our expenses. I think a significant increase in that right now would not be a good idea to add on top of it," Biermann said.
Multiple aldermen, including newcomer Shamed Dogan, questioned what costs with the project were unanticipated.
“We made some mistakes that were big mistakes,” Biermann said. “An assumption was made that some of the materials would be hauled off at a very close distance."
Biermann said that when it was discovered that the dirt and materials on site didn't match the specifications sought by the potential buyer, the development's overall cost grew.
“That went from being a pretty hefty cost savings to all of a sudden having us ask, ‘Now what are we going to do with this dirt?’
Biermann said those setbacks could cost close to $700,000, or between $500,000 and $1 million, though total expenses still are being calculated.
"We’re still trying to figure out exactly what (amount) we mean," Biermann said. "We want to try to keep the percentage of the (total development budget) as low you can so you can recover that cost as quickly as possible.”
No action was promised by board members, though the issue could be raised in the upcoming quarter, Biermann said.
“I’m just trying to figure out if this even would be palatable with the city for us. We’re trying to do the right thing with ways to recover here. “
Following Biermann's address to the board, Ballwin resident Robert Klein indirectly addressed the developer's proposal during the public comments.
“That was probably the most honest discussion I’ve heard from a developer in the three years that I’ve been coming to these meetings,” said , who also raised concerns Monday tied to county tax payments and last year's aldermanic elections.
Editor's Note: An earlier version of this article incorrectly identified the tax mechanism sought by developer Bill Biermann.