A Reinvestment Housing Incentive District, or RHID, planned for Chanute has been a source of contention between the Neosho County Commission and the Chanute City Commission, with both sides blaming each other for communication failures.
At last week’s county commission meeting, Neosho County Commission Chair Nicholas Galemore responded to comments from Chanute City Commissioners, claiming that the RHID would be an undue burden on the county.
“I take offense to the lack of correspondence,” Galemore said.
He did not mention in his comments that his own personal business could be affected by a new apartment complex in Chanute. He and his wife, Darilyn, are listed as the owners of Pine Oaks Apartments in Chanute, according to the Kansas Secretary of State’s office.
A public hearing was held Aug. 25, before Chanute passed the RHID ordinance. Before a public hearing, a notice must be published in the local newspaper to give potentially affected parties advance notice of the project. The initial hearing notice was published on Aug. 12. No public comments were made at the hearing. Darin Luebbering, the developer working on the RHID project, said he assumed that, with no objection at the hearing, no one had an issue. The RHID notification went out on the 9th of September, according to Luebbering.
“They had from Sept. 9 till Sept. 23 to review the ordinance,” he said. “They could have called the city, called me, called anybody to find out about anything.”
State law gives 30 days for any other taxing entities to protest the RHID, and the county passed the resolution protesting the RHID on Sept. 23. Before passing the resolution, there was not much discussion among the commissioners, aside from Galemore, who said it would affect Neosho County, the school district, and the college more than it would affect Chanute. Galemore did not acknowledge that he had a conflicting business interest during that meeting either.
Galemore said the burden would affect the county more than the City of Chanute because the city does not have property taxes. After the Tuesday meeting, he said it would cost the county $770,000. However, that number comes from a state projection of what the property value would be if the complex were built without any tax incentives, not what the county currently collects.
The 32-door complex was planned for a currently empty lot on 28th Street, behind Walmart. Chanute City Manager Todd Newman said he was not aware of any other planned development for the lot.
According to the Kansas Department of Commerce, an RHID is a program to aid development in communities that are in need of housing. The program essentially allows developers to use what they would be paying in property taxes on the newly developed housing to help defray the infrastructure costs. An RHID can last for up to 25 years. Luebbering said that the project would be cost-prohibitive without the incentives.
“This is a project that I have wanted to do for years, but couldn’t because the rents were too high or the exposure was too high,” he said. “(with the incentives) It kind of fell into place. It was like maybe we can do this for Chanute because it is so needed.”
Luebbering does not believe a market-rate apartment complex has ever been purposefully built in the city of Chanute. Market-rate apartments differ from several other local apartment complexes that have income or age restrictions.
Neosho County currently offers a Neighborhood Revitalization program, which is a different tax abatement program for a total of 10 years. According to Luebbering, it is not enough.
“It would be a monthly difference of $300-$400 (in rent per unit),” he said.
Luebbering still has hopes that a resolution can be found and is currently trying to move forward with possibly another plan or location. He had hoped to start on the complex this month, with a potential completion date of November 2026, but now it will be pushed back into 2027.
“I have got to go back to the state and get approval for a new project, so it is basically back to the drawing board for right now,” he said.
