We realize the word “gamble” is not pretty, but THE DEBT IS ABSOLUTE. THE TIF INCREMENTAL REVENUE IS NOT.
What you have repeatedly heard from the City of Westwood is…
“You will get a feature park.”
It has been the City’s mantra to divert your attention away from:
If citizens approve the sale of Joe D. Dennis Park, its demolition and building improvements in a new “feature park” while adding $4,890,000 in additional debt, this debt-financed project would result in a grand total of $11.5 million of debt in a city with about 1,750 people, over 1,400 of which are adults.
So where are we going with this?
A look at our NE Johnson County neighbors quickly tells us that per adult, Westwood is already in debt more than any nearby city, nearly 3.7x more than Mission Hills and over 2.5x more than Roeland Park (see Chart 1). And this amount is BEFORE adding the additional debt burden imposed on citizens for building the park/improvements next to the complex.
This is called overly leveraged (when an entity is carrying extremely high debt). Westwood is already far and away the most leveraged city around here with a current total of $4,600 per adult. If the debt financing of the park proceeds as planned, Westwood will have saddled its taxpayers with over $8,000 total debt per adult (see Chart 2). The additional G.O. bonds and associated interest expense over the life of the new park loan will be more than $5,000 per adult.
Having already presented to the public the Columbia Capital projection based on General Obligation (G.O.) debt, the City now suggests in its Supplemental Q&A that Westwood may issue Special Obligation (S.O.) debt instead, or maybe a combination of both. S.O. debt would increase the interest rate (a greater percentage rate) that creditors would demand, given that S.O. debt is not fully guaranteed to be paid back by the City (the G.O. debt is a 100% guaranteed payback from the City to its creditors). Interestingly, the City has yet to adjust the TIF projections to recognize the increased interest rate.
Moreover, with this level of G.O. and S.O. debt, if Westwood defaults on either, the City’s credit rating would likely take a massive hit. And though Westwood would not have to make good on the S.O. debt, it is very possible the City still would look to cover in full such debt in order to protect their credit rating for any future debt issuance.
And here’s a haunting look into the not-so-distant future....
After the TIF project term expires, Karbank has the right to sell their office complex to anyone, including a tax exempt entity such as KU Med. “But what is so bad about that?” one might ask. Westwood would then be saddled with public service responsibilities to the office complex and costs of providing such services, along with maintenance of a park…with no incremental tax revenue to fund either expense.
We have said this many times. It's important enough to say again:
THE DEBT IS ABSOLUTE; THE TIF INCREMENTAL REVENUE IS NOT. Please choose wisely. VOTE NO.
Your Vote-by-Mail ballot will be mailed to you mid-March.
It must be RETURNED — not merely postmarked — by noon, April 1st, 2025.
