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BPU is willing to give Oz an extra year to repay $400,000
By GRACE HOBSON - The Kansas City Star
Date: 07/05/01 22:52
The Unified Government's Board of Public Utilities is willing to give the Oz Entertainment Co. an extra year to repay $400,000, despite a state law that requires the company to make the payment by the end of October.
The Kansas Legislature this spring required Oz to reimburse the Unified Government $550,000 in grants that governments in Wyandotte County gave the company in the early 1990s. At the time, Oz planned to build a multimillion-dollar theme park and resort in the county, but the company has since moved its proposal to western Johnson County.
Oz asked BPU officials for the deferment shortly after the legislation passed, BPU officials said.
The BPU board members would agree to the deferment if Oz signed a promissory note requiring the payment with interest and if Oz repaid the Unified Government its $150,000 by the current deadline, among other requirements, according to a BPU letter to Unified Government Mayor Carol Marinovich.
The proposed deal has been outlined only in draft form and will be negotiated, said Leon Daggett, the BPU's general manager.
The Unified Government's commission would have to approve the extension. Marinovich has not yet responded to the letter and could not be reached for comment Thursday.
"We've given them $400,000; I'd like to have it now," Daggett said. "But they don't have it to give. What are my options?"
Oz attorney John Petersen said he did not know whether Oz could afford to repay the money by the deadline set in state statutes, but he said Oz would meet its "statutory obligations."
"If an agreement can be reached short of a straight reimbursement that makes business sense, that's a viable option," Petersen said.
Oz Chairman Robert Kory could not be reached for comment.
Under the current proposal, the BPU also would require Oz to commit to negotiating an exclusive 20-year electric power supply contract for the Oz project with the BPU, according to the BPU's letter to Marinovich.
If Oz buys power from the BPU, Daggett said, the company could get its $400,000 back within the rate structure it would negotiate. The BPU, for example, gave Kansas Speedway $3 million in infrastructure improvements, he said.
An agreement to sell power to Oz, however, is a long shot because of regulatory hurdles, Daggett said.
State Rep. Tom Burroughs, a Kansas City, Kan., Democrat who wrote the amendment requiring Oz to repay the money by the end of October, said he opposed an extension.
"I don't like it," Burroughs said. "The intent of my bill is we've waited long enough to get any return on my community's investment."
But Loretta Colombel, vice president of the BPU board, said the agreement would be a good way to ensure the BPU gets its money back.
The extension would buy the company time as it awaits the Johnson County Commission's approval, she said. The commission has twice deadlocked on Oz but is expected to vote again after conducting a feasibility study this summer.
"We don't have anything now, but there's a better chance of getting it if we give them the little bit of breathing space they need," Colombel said.
State Sen. Karin Brownlee, an Olathe Republican who opposes Oz, questioned why a company proposing an $861 million project would need the deferment.
"I hope Johnson County would take that into consideration," Brownlee said
BPU is willing to give Oz an extra year to repay $400,000
By GRACE HOBSON - The Kansas City Star
Date: 07/05/01 22:52
The Unified Government's Board of Public Utilities is willing to give the Oz Entertainment Co. an extra year to repay $400,000, despite a state law that requires the company to make the payment by the end of October.
The Kansas Legislature this spring required Oz to reimburse the Unified Government $550,000 in grants that governments in Wyandotte County gave the company in the early 1990s. At the time, Oz planned to build a multimillion-dollar theme park and resort in the county, but the company has since moved its proposal to western Johnson County.
Oz asked BPU officials for the deferment shortly after the legislation passed, BPU officials said.
The BPU board members would agree to the deferment if Oz signed a promissory note requiring the payment with interest and if Oz repaid the Unified Government its $150,000 by the current deadline, among other requirements, according to a BPU letter to Unified Government Mayor Carol Marinovich.
The proposed deal has been outlined only in draft form and will be negotiated, said Leon Daggett, the BPU's general manager.
The Unified Government's commission would have to approve the extension. Marinovich has not yet responded to the letter and could not be reached for comment Thursday.
"We've given them $400,000; I'd like to have it now," Daggett said. "But they don't have it to give. What are my options?"
Oz attorney John Petersen said he did not know whether Oz could afford to repay the money by the deadline set in state statutes, but he said Oz would meet its "statutory obligations."
"If an agreement can be reached short of a straight reimbursement that makes business sense, that's a viable option," Petersen said.
Oz Chairman Robert Kory could not be reached for comment.
Under the current proposal, the BPU also would require Oz to commit to negotiating an exclusive 20-year electric power supply contract for the Oz project with the BPU, according to the BPU's letter to Marinovich.
If Oz buys power from the BPU, Daggett said, the company could get its $400,000 back within the rate structure it would negotiate. The BPU, for example, gave Kansas Speedway $3 million in infrastructure improvements, he said.
An agreement to sell power to Oz, however, is a long shot because of regulatory hurdles, Daggett said.
State Rep. Tom Burroughs, a Kansas City, Kan., Democrat who wrote the amendment requiring Oz to repay the money by the end of October, said he opposed an extension.
"I don't like it," Burroughs said. "The intent of my bill is we've waited long enough to get any return on my community's investment."
But Loretta Colombel, vice president of the BPU board, said the agreement would be a good way to ensure the BPU gets its money back.
The extension would buy the company time as it awaits the Johnson County Commission's approval, she said. The commission has twice deadlocked on Oz but is expected to vote again after conducting a feasibility study this summer.
"We don't have anything now, but there's a better chance of getting it if we give them the little bit of breathing space they need," Colombel said.
State Sen. Karin Brownlee, an Olathe Republican who opposes Oz, questioned why a company proposing an $861 million project would need the deferment.
"I hope Johnson County would take that into consideration," Brownlee said