June 23, 2004

The Honorable Mark W. Taddiken
State Senator, 21^st District
2614 Hackberry Road
Clifton, Kansas 66937

Re:

Synopsis:

Dear Senator Taddiken:

You request our opinion regarding whether monies raised through bonds issued pursuant to K.S.A. 12-1770 et seq. may be used to pay the costs of demolishing buildings and capping sewer lines as part of a redevelopment project.

The legislatively stated purpose for enactment of the Tax Increment Finance Act (TIF)⁽¹⁾ is to

"promote, stimulate and develop the general and economic welfare of the state of Kansas and its communities and to assist in the development and redevelopment of eligible areas within and without a city thereby promoting the general welfare of the citizens of this state. . . ."⁽²⁾

The redevelopment is pursued by a city through a two-step process, with the first step being establishment of a redevelopment district within an eligible area.⁽³⁾ In order to determine whether an area constitutes an eligible area, the city's governing body is required to conduct a public hearing.⁽⁴⁾ An eligible area may be "a blighted area, conservation area, enterprise zone, historic theater, major tourism area or a major commercial entertainment and tourism area as determined by the secretary [of commerce]."⁽⁵⁾ Once the redevelopment district has been established, the city's governing body may adopt an ordinance that sets forth the redevelopment district plan.⁽⁶⁾ The "'[r]edevelopment district plan' or 'district plan' [is] the preliminary plan that identifies all of the proposed redevelopment project areas and identifies in a general manner all of the buildings, facilities and improvements in each that are proposed to be constructed or improved in each redevelopment project area."⁽⁷⁾

A city is authorized "to issue special obligation bonds in one or more series to finance the undertaking of any redevelopment project. . . ."⁽⁸⁾ The proceeds of the special obligation bonds may be used to pay redevelopment project costs.⁽⁹⁾ Redevelopment project costs are "those costs necessary to implement a redevelopment plan, including, but not limited to costs incurred for . . . site preparation including utility relocations . . . [and] all related expenses to redevelop and finance the redevelopment project."⁽¹⁰⁾

The rules of statutory construction are followed in determining whether demolition of buildings and capping sewer lines constitute site preparation as that term is used in K.S.A. 2003 Supp. 12-1770a, as amended.

"Words and phrases shall be construed according to the context and the approved usage of the language, but technical words and phrases, and other words and phrases that have acquired a peculiar and appropriate meaning in law, shall be construed according to their peculiar and appropriate meanings."⁽¹¹⁾

The phrase "site preparation" appears in at least eight state statutes and only a few Kansas appellate court opinions, none of which provides a particular definition for it. It is not a technical phrase accorded a special meaning. Therefore, it must be given its ordinary meaning.

"Site" is "[a] plot of ground suitable or set apart for some specific purpose."⁽¹²⁾ "Preparation" means "[t]he act or process of preparing. . . . Preliminary measures that serve to make ready for something. . . ."⁽¹³⁾ When development or construction projects are considered, site preparation has been commonly understood to include demolition and removal of existing structures, adding fill and grading the area.⁽¹⁴⁾ Because K.S.A. 12-1770 et seq. recognize projects that will involve development or construction, we believe that it is appropriate to apply this understanding when interpreting K.S.A. 2003 Supp. 12-1770a, as amended. Site preparation may include demolition of buildings when the demolition is necessary to prepare the site for buildings and facilities proposed to be constructed in a redevelopment district.

Subsection (q) of K.S.A. 2003 Supp. 72-1770a, as amended, expressly includes utility relocation as being a part of site preparation. Sewers and sewer systems are commonly included in the types of utilities that may be provided by a municipality.⁽¹⁵⁾ Therefore, relocation of sewer lines, including capping existing lines, is authorized as a site preparation under K.S.A. 2003 Supp. 72-1770a(q), as amended.

In review, demolition of buildings and the capping of sewer lines can constitute site preparations under K.S.A. 2003 Supp. 12-1770a, as amended. As such, monies raised through bonds issued pursuant to K.S.A. 12-1770, et seq. may be used to pay the costs of these activities.

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^1. K.S.A. 12-1770 et seq.

^2. K.S.A. 12-1770.

^3. K.S.A. 12-1771.

^4. See K.S.A. 12-1771.

^5. K.S.A. 2003 Supp. 12-1770a(g), as amended by L. 2004, Ch. 154, § 3.

^6. K.S.A. 12-1771(b); 12-1772.

^7. K.S.A. 2003 Supp. 12-1770a(s), as amended. See also K.S.A. 12-1771(b).

^8. K.S.A. 2003 Supp. 12-1774(a)(1), as amended by L. 2004, Ch. 154, § 6. See also K.S.A. 12-1770; K.S.A. 2003 Supp. 12-1774(a)(3), as amended.

^9. K.S.A. 12-1773(b).

^10. K.S.A. 2003 Supp. 12-1770a(q), as amended.

^11. K.S.A. 2003 Supp. 77-201 Second. See also Neal v. Hy-Vee, Inc., 81 P.3d 425, 436 (Kan. 2003).

^12. Black's Law Dictionary 1243 (1979).

^13. Webster's II New Riverside University Dictionary 929 (1988).

^14. See, i.e., Portland Utilities Const. Co., LLC v. Chase, 2004 WL 746602 (Tenn.Ct.App., Apr 07, 2004) (remove two barns; fill in pond); Garrett v. Valley Sand and Gravel, Inc., 800 So.2d 600 (Ala.Civ.App. 2000) (demolition of building, grading and debris removal); Harris v. Cincinnati, 607 N.E.2d 15 (Ohio App. 1 Dist. 1997) (demolition of buildings and structures; removal of debris); State ex rel. Missouri Highway and Transp. Com'n v. Our Savior Lutheran Church, 922 S.W.2d 816 (Mo.App. E.D. 1996) (clearing and demolition); Brewster v. Salveson Const., Inc., 765 P.2d 1350 (Wyo. 1988) (fill and grading); Tober's Inc. v. Portsmouth Housing Authority, 367 A.2d 603 (NH 1976) (demolition of structures, including a building).

^15. See K.S.A. 10-1201 et seq.; 12-6a01 et seq.