KSHB 41 reporter Lily O’Shea Becker covers Franklin and Douglas counties in Kansas. Share your story idea with Lily.
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The city of Lawrence and its residents are starting to get an idea of what businesses will want to build in and alongside The Mercato development in west Lawrence.
As of now, it's confirmed Costco, Braum's Ice Cream & Dairy Store and Truity Credit Union will open doors within The Mercato, a new 90-acre mixed-use development project located at the northeast corner of 6th Street and Kansas Highway 10, according to LANE4 Property Group.
Costco is set to open "just in time for Thanksgiving" this fall, per a press release from the property group. Preparations for the build are currently underway.
“I mean, we know with new developments sometimes there’s an additional tax," said Shannon Graham, Lawrence resident. "I don’t know if that will be something that will be part of the prices we’ll be paying or not.”
Several other people commented the same question under KSHB 41 News' online reporting. So KSHB 41 Douglas County reporter Lily O'Shea Becker took their question to the city of Lawrence.
The answer is no — The Mercato will not be a special tax district, according to a city spokesperson. The city did not provide any incentives for Costco to open doors in Lawrence.
Catalyst Property Group is proposing a two-lot commercial development project adjacent to The Mercato at 566 George Williams Way.
Unlike the developers for The Mercato, developers are asking the city commission to approve a one-percent Community Improvement District (CID) sales tax to fund the project on the undeveloped lot.
Developers say the sales tax would help reimburse costs to address development constraints on the 5-acre lot, such as "substantial grade change, rocky soils, and the absence of sanitary sewer and other utility extensions," according to a city staff report.
According to documents on the city's website and discussions at recent planning and city commission meetings, Aldi is identified as the anchor business for the project. While a second business has not yet been identified, "several commercial users have expressed interest in the lot," per the city staff report.
Tuesday night, the City Commission voted to approve a request to rezone the undeveloped lot to accommodate the proposed project.
The commission also voted 4-1 to accept the developer's CID request for consideration.
Commissioner Kristine Polian said she voted in favor of accepting the request for two reasons: a CID wouldn't reduce the city's revenues, and residents don't have to shop at Aldi if they don't want to.
Vice Mayor Mike Courtney cast the single vote against accepting the request.
"I know it's only going to be a CID that affects people in that business, but I don't want to open the door for other businesses to think there are abatements available here in this area, because any business here is going to kill it," Courtney said at the commission meeting before doubling down that the reason he voted no was because of the area of the proposed project.
If approved after consideration, the 1% sales tax would only be applied to purchases within the two-lot commercial property district.
According to the city staff report, the undeveloped lot generated about $5 in property taxes in 2025. If the development comes to fruition as planned, the project would create over $6 million in combined property and sales tax revenues while the CID sales tax is implemented over 22 years.
"It's reasonable to expect that we'll have some additional commercial development coming through over the next few years, especially as The Mercato development comes along," Luke Mortensen, a planner with the city of Lawrence, said at a planning commission meeting in January.
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In the developer's application for the CID, it says, in addition to creating tax revenues, the project would benefit the public because it "brings (a) first-class 'value' grocer to west side of (the) city."
Because the application was accepted, city staff will work with Baker Tilly, the city's financial adviser, and the bond counsel to review the request.
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