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Introduction
This report provides infonnation pertaining to the economic development
benefits that are estimated to be derived from the construction of an
interchange at Interstate 135 and Magnolia Road in Salina, Kansas. This
project is being proposed as a highway improvement under the Kansas
Department of Transportation System Enhancement Program. The report
provides data on existing and projected economic activity in the impact area
and how the localized economy might be stimulated. In tenns of format, the
infonnation has been organized as responses to the questions previously
supplied by the Governor's Economic Development Review Panel.
Description of the Project
The proposed highway improvement project consists of a new interchange
at 1-135 and Magnolia Road. Presently, a two-lane bridge carries Magnolia
Road traffic over 1-135 but no access to or from the interstate is
available. Although the project has not been designed, it is anticipated
that the improvement would include a conventional diamond interchange and
structural modification of the existing bridge. The Kansas Department of
Transportation estimates the total cost of these improvements to be
$4,132,000. Included in the cost estimate are preliminary engineering,
right-of-way, utility relocation, construction, construction engineering and
a contingency.
Project Funding
In order to help leverage this highway improvement project, the community
will provide matching funds equal to 15 percent of the total cost or
$620,000. A group of 30 surrounding property owners have offered to pay
one-half of the local match or $310,000. Such funds will be generated
through the creation of a special assessment district comprising 210 acres
of land. The City will issue municipal improvement bonds which will be
retired by special assessments levied against the benefit district over a 10
year period. The remaining $310,000 will be provided by the City of Salina
and the Salina Airport Authority.
~uestion 1 - Describe the area that will be impacted by the requested
ighway project.
The requested highway project is located in Salina, Kansas, a city of 44,000
people situated at the intersection of Interstates 70 and 135. The impact
area is a growing sector of southwest Salina and comprises about five
square miles (see Figure 1). Near the center of the area is the inter-
section of South Ninth Street and Magnolia Road where the Mid-State Mall and
Central Mall are located. The following data characterizes the nature and
size of these facilities:
Table 1
Year # Parking
Name Opened Sq. Ft. # Tenants Spaces
Mid-State Mall 1971 300,000 19 1,200
Central Mall 1987 330,000 38 1,800
Source: Salina Chamber of Commerce.
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Joining the 57 mall tenants, another 44 free-standing retail and service
businesses exist along this stretch of Ninth Street, making this area the
largest concentration of retail shopping within both the City of Salina and
north-central Kansas.
In regards to planned developments, Sears recently announced their decision
to close their downtown store and build a new department store at the
Central Mall. Sears will become the fourth department store, joining
Dillards, Penneys and Beall-Ladymon. In addition, Wal-Mart is presently
building a new free-standing store at Schilling Road and Ninth Street (1
mile south) and will be vacating the Mid-State Mall. The interchange
project could be very helpful in filling this vacated space.
The other major concentration of businesses are found in the Airport
Industrial Center located 1 mile west pf 1-135. Utilizing land and
buildings formerly occupied by Schilling Air Force Base, which was closed in
1968, some 50 manufacturing, distribution, and construction firms now exist.
The area is also home to the Kansas College of Technology and the Salina
Area Vocational-Technical School.
The impact area is within Salina's corporate limits except for a one square
mile area between 1-135 and the Schilling Industrial Area. This island of
unincorporated agricultural land is under the jurisdiction of Saline County.
The major land use areas are shown in Figure 2 and existing zoning is shown
in Figure 3.
Question 2 Provide an estimate of the number of businesses and jobs in
the impact area.
Saline County has a broad-based, diversified economy. A large concentration
of Saline County's businesses and jobs in the manufacturing and retail
sectors of the economy are located in the impact area. A total of 50
businesses and 2,605 jobs are located in the Airport Industrial Center and
101 retail and service establishments and 1,365 jobs are located in the
Ninth and Magnolia Shopping Area. Based on figures from the U.S. Census
Bureau I s County Business Patterns, 46% of the county's manufacturing jobs
are concentrated in the Airport Industrial Center. Approximately 18% of the
county's retail employees work in the Ninth and Magnolia Shopping Area.
An estimate of the number of jobs and businesses currently existing in
the Magnolia Road interchange impact area is as follows:
Businesses
Jobs
Agriculture
Trans./Comm./Utilities
Manufacturing
Construction
Retail Trade
Wholesale/Distribution
Financial Services
Tourism/Amusement
6
7
8
2
64
5
.7
4
15
80
1,850
75
886
140
67
43
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Businesses
Jobs
Government
Other Services
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36
444
370
3,970
-
151
Sources: Existing Business Inventory and surve~, prepared for the
Salina Airport Authority by Wilson "[ Company, onsulting Planners,
Engineers & Architects; Salina Chamber of Commerce; Estimates by
Salina Planning Department.
Question 3 Describe the trends in the impact area's economy over the
past five years.
Over the past five years, the center of retail activity within Salina
has shifted to the Ninth and Magnolia Shopping Area. Since 1985, this
area has seen the construction of the 330,000 sq. ft. Central Mall, a
65,000 sq. ft. grocery store and a 38,000 sq. ft. strip center known as
the Galaxy Shops. In addition, several retail stores and restaurants
have located on outparce 1 s around these developments. The result has
been a growth in both retail sales and the number of retail jobs in the
impact area. Although some local retailers have shifted their
locations to this area, most of the retail outlets are new businesses
in Salina and have resulted in the creation of new retail jobs.
In addition to retail jobs, much of the growth in Salina's industrial
employment over the past five years has occurred in the Airport Industrial
Center which is within the impact area. Three of the 10 largest employers
in Salina are located in the Airport Industrial Center and employment in
this area accounts for approximately 10% of the total Salina work force.
There are approximately 50 businesses located in the Airport Industrial
Center and 18 of those have located at their present place of business
within the past 5 years. In a survey of these businesses conducted by
Wil son & Company, 62% of the respondi ng bus i nesses reported increases in
their business volume over the past five years.
The economic growth experienced by the impact area has resulted in the
following employment gains over the past five years:
1)
2)
3)
4)
Total number of jobs created - 1,115
Number of jobs that resulted from local firms expanding - 395
Number of jobs that were the result of firms starting or locating
in the area - 720
The types of industries and the jobs created are as follows:
Retail and Service businesses - 610
Manufacturing/Transportation - 433
Education/Training/Rehabilitation - 72
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Question 4 - Will the hi
ment in other infrastructure
un e
Completion of the Magnolia Interchange project is expected to bring about a
significant amount of new economic development activity. Resultant activity
occurring within the 9th Street Shopping Area and the Airport Industrial
Center can generally be supported by existing public facilities and
services. The one deficiency present within the Ai rport Industri a 1 Center
is sewage treatment capacity. In a recent engineering study, it has been
determined that the Schilling Sewage Treatment Plant should be replaced with
a force main which would transport waste effluent to the main treatment
plant located northeast of the city. This project has been scheduled for
construction in 1992. Estimated to cost $6.5 million, the project is
programmed to be funded primarily with Sewer Utility Revenue Bonds.
Another major area expected to attract development interest as a result
of the interchange project is the large vacant area just west of 1-135.
This area 1 ies in unincorporated Saline County and is presently lacking
public facilities and services necessary to support urban development.
Such development is expected to consist of highway commercial uses (motels,
truck stops, restaurants, etc.) adjacent to the interchange, warehousing and
distribution facilities near the interchange, light manufacturing and
advanced technology businesses at the western edge of the area near the
Kansas College of Technology and housing development located in the southern
section adjacent to existing residential neighborhoods. Improved roadways,
bridges and water and sewer utilities will be needed to accommodate this
development as follows:
Table 3
Faci lity
Cost
Funding
SpeCial Gas Tax and/
or Sales Tax
Improve Centennial Road $ 250,000
and Magnolia Road Intersection
Structurally modify Magnolia
Road Bridge at Dry Creek
Improve Magnolia Road from
Centennial Road to 1-135
150,000
Same as above
150,000
Same as above
Install 12" water line from
Centennial Road to 9th Street
160,000
Revenue Bonds and
Special Assessments
Sources: 1-135 Intercha,e ~rovement S~UdY prepared by Bucher,
WilnnSiand Ratlif ; Sa na Engineer ng Department.
Ultimately, as more intensive urban development occurs, additional
improvements such as the widening of Magnolia Road, may be needed to
accommodate demand. These improvements will be scheduled in local capital
improvement programs to coincide with economic activity.
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Needed sewer line extensions have not been shown separately as the Schilling
Force Sewer Main will be located along Magnolia Road. This facility will
have segments which function under gravity flow and as such will be
accessible for connection from lateral sewer lines serving adjacent
development.
The impact area is adequately served by other public facilities and services
such as fire stations, police protection, schools and parks. Fire stations
are located minutes away on Belmont Blvd. near Ninth Street and on the
municipal airport grounds. A portion of the vacant land along Magnolia Road
is in the flood plain and may be suitable for development as a regional
park.
In 1991, the city will undertake a major update of the Comprehensive Plan.
Special attention will be directed to the Magnolia Road corridor with
specific recommendations for sound land use patterns, orderly extension of
public utilities and services, and appropriate zoning and development
standards.
Question 5 - Briefly describe current local pro1rams or activities designed
~promote economic development that would be re ated to the requested
IllgIjway project.
The Salina community is very well equipped to realize the potential
economic development gains related to the interchange project.
Community leaders have established a cooperative organizational
arrangement involving both business and government with each sector
responsible for the execution of specific programs. The organizational
structure involves a partnership of the Salina Area Chamber of Commerce.
Salina Airport Authority, the City of Salina and Saline County. In order to
illustrate how this organization functions. major programs and activities
carried out by each entity are presented below.
Chamber of Commerce - Provides the overall leadership and administrative
coordination; maintains the professional staff to promote investment
opportunities and market available sites and facilities; supplies the
development expertise to assist existing businesses to expand facilities and
enable new businesses to commence operations; maintains an economic data
base on industrial sites, utilities, labor force. business support services,
etc.; participates in state efforts to contact and recruit industrial
prospects; convenes meetings and distributes information pertaining to
business planning, environmental regulations, tax incentives, and employee
training.
Salina Airport Authority - Provides industrial development sites complete
with improvements; supplies industrial revenue bond financing to enable
business to construct needed buildings and facilities; supports infra-
structure improvements such as roadway and bridge construction by assisting
with project financing; develops, operates and maintains a full-service
airport to assist business travelers and local air transportation
industries.
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Cit~ of Salina/Saline County - Provides comprehensive land use planning,
zonlng and building code administration; supplies public facilities and
services to support business activity such as water and sewer service,
roadway improvements, fire protection, etc.; provides incentives for
business expansion such as industrial development bonds, tax abatement on
new plant and equipment and enterprise zone status; provides professional
staff assistance for businesses seeking governmental financing to expand
operations and create jobs.
Other - The following facilities are located within the Airport Industrial
Center: a Small Business Incubator, Small Business Development Center, and
the Regional Office of the Kansas Department of Commerce. These institu-
tions provide business assistance programs which support Salina's role as a
regiona 1 growth center, as designated by the federal Economic Development
Administration.
As the above activity listing shows, the Salina community has established a
very capable and cost-effective organizational structure for the pursuit of
economic development. If the highway project is funded, the framework and
programs are already in place to assist existing businesses with expansion
potential and develop new industries suited to the new opportunities created
for economic growth.
Question 6 - What are the anticipated economic impacts on the area if the
requested highway improvement is constructed?
The Magnolia and 1-135 Interchange project is expected to generate
additional economic activity in several major ways:
I} Expansion of retail sales and employment among existing retail and
service businesses located in the Ninth and Magnolia Shopping
Area;
2} Attraction of additional retail and service firms to sites in
close proximity to the proposed interchange;
3} Expansion of existing firms and creation of new businesses in the
Airport Industrial Center; and,
4} Expanded programs and student enrollment at the Kansas College of
Technology.
In 1988, according to the Kansas Department of Revenue, total retail sales
in Saline County were $401 million. Based on a percentage of total County
retail employment (18%), the Ninth and Magnolia Shopping Area generates $72
million in retail sales annually. As a result of the proposed project,
retail sales are estimated to increase 10 percent with employment growing by
5 percent. This equates to an increase of $7 million in retail sales and 68
new jobs. In addition, the following new businesses and jobs are
anticipated to be generated adjacent to the interchange as a direct result
of improved accessibility:
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Table 4
New Businesses
# New
Jobs
45
25
15
40
120
Hotel/motel
Truck Stop
Service Station
Restaurant (2)
Source: Estimates by Salina Planning Department.
Improved access to Interstate 135 is a J so expected to di rectly assi st
business expansion and formation within the Airport Industrial Center.
Improved access could directly assist the following business expansions:
Table 5
Business Activity Investment # Jobs
Beech Aircraft manufacturing $20,000,000 150
project for new Beechjet
Business Incubator Building $300,000 120
with space for 7 firms
National Guard Armory Building $2,800,000 110
and Training Facility + 35 students
New manufacturing prospect $800,000 100
Source: Salina Chamber of Commerce and Salina Airport Authority.
The proposed project would also improve local business operations. Wilson
and Company survey data indicates that 90 percent of existing area firms
utilize truck transportation to support their business operations. For
those companies dependent upon surface transportation, improved accessi-
bility is vital in the delivery of raw materials and distribution of
fini shed products to market. Effi cient highway accessi bility can reduce
business costs by saving fuel, vehicle maintenance and employee man-hours.
In the Wilson and Company survey, a question was asked regarding what should
be done to improve the Airport Industrial Center for continued industrial
development? The follOWing responses were provided: "Access to 1-135 by a
direct route"; "Easier access to the north end of the complex"; "Build
interchange at Magnolia and Waterwell Road".
The prospects for continued economic growth at the Airport Industrial Center
are excellent. Given the existing investment in both infrastructure and
support services, this area will continue to function as a prime job-
producing location within north-central Kansas.
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Finally, the Magnolia Interchange could benefit the Kansas College of
Technology. The following new facilities illustrate how Kansas Tech is
expanding its educational mission in the emerging field of engineering
technology:
Table 6
Faci li ty
International Pilot Training
Center
Investment
Jobs
$700,000
20
+96 students
Aircraft Mechanic Classroom
and laboratory
Source: Salina Airport Authority.
$1,090,000
10
+120 students
In furtherance of Kansas Tech's mission, the Kansas Board of Regents has
established a long-range planning committee to examine future opportunities
for growth and make recommendati ons for needed programs and faci 1 ities.
The interchange project could assist forthcoming recommendations for the
future development of Kansas Tech by providing a direct link from the
interstate to the campus located at the western terminus of Magnolia Road.
Such a route would eliminate the necessity for traveling industrialized
roadways to access the college. The industrialized setting coupled with a
location reached only by an indirect roadway system has served as an
impediment to the development of a quality, campus-like physical
environment. A preliminary master development plan has been prepared
calling for a perimeter defining road system and new student facil ities
(cafeteria, student center, gymnasium and dormitories). Improved interstate
access could help attract students and thus enable these developmental goals
to be realized.
In the short-range (5 years), the proposed interchange project can be
expected to generate or otherwise support. some 20 new business ventures
and 700 jobs. Such economic activity will create a continuing annual
payroll of $9.8 million ($14,OOO/job) with another $6.5 million (2/3 of
payroll) spent by the businesses on the purchase of local goods and
services. Although more difficult to measure, this added income will have
induced economic effects by a multiple of 2 to 3 in the form of expenditures
for housing, transportation, food, health care, and other goods and
services. And, the above expenditures do not account for taxes that will be
derived from retail sales, property, and income generated by this expansion.
Over the long-term (15 years), the proposed project can be expected to
not only sustain recent growth and development trends but attract new
capital investment in manufacturing plant and equipment, provide site
location advantages for new distribution and travel-related firms, and
bolster advanced technology education and training endeavors. Taken
together, these types of activities hold promise for helping this region of
the state keep pace with a rapidly changing, more competitive economy.
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~uestion 7 - How will eXisting businesses in the impact area be affected
y the highway improvement?
As previously mentioned, at the present time no access is available to
Interstate 135 at Magnolia Road. As such, interstate traffic cannot obtain
direct accessibility to the estimated 101 retail and service businesses
within one-half mile of the potential interchange. Therefore, the
additional customers represented by thru traffic or those travelers with a
non-local destination is a largely untapped market. With 1-135 carrying
8,865 vehicles per day, if even a small portion of the thru traffic would
exit the highway and obtain a meal, purchase gasoline, shop in the retail
stores, or seek lodging accommodations, this new business activity could be
very beneficial to the community and even state.
It should be recognized that the 20 county regional trade area traffic
would also be affected by the presence of this new interchange. According
to the Bureau of Economic Analysis, in 1989 this area contained 288,000
people with an estimated total personal income of $3.9 billion. This market
segment can be divided into those who shop in Salina at the Ninth and
Magno 1 i a Shoppi ng Area and those who wou 1 d or wou 1 d more frequently if
direct interstate access were available. This latter market segment also
represents an existing untapped market.
In regards to current customers, direct access may divert a portion of such
traffic from present businesses, such as those located on West Crawford
Street (2 miles north). Traffic choosing to exit 1-135 at Crawford Street
travels east to Broadway Boulevard and then south along Broadway and Ninth
Street (a distance of 3 miles) to the subject area. This traffic represents
a built-in customer base generated by the Ninth and Magnolia Shopping Area
which is their ultimate destination. Customers loyal to businesses on the
existing route or who desire the products or services they provide will not
change their travel patterns. Those who wish to avoid urban traffic
congestion and save time will switch to the more direct route. Although
some diversion may occur, Crawford wi 11 continue to be city's primary
interstate access point. Because of this status, city and federal funds
have been programmed to widen and improve Crawford from 1-135 to Ohio Street
(2.5 miles) beginning in 1990.
The other major group of bus i nesses impacted by the interchange project
would be firms in the Airport Industrial Center. Direct access to 1-135
would benefit firms engaged in the manufacturing and/or distribution of
consumer and industrial products. Access to 1-135 is now obtained by use of
Centennial Road and Schilling Road. A major impediment to the Centennial
Road traffic is its intersection with Crawford Street which connects to
1-135. This intersection is not signalized and the heavy traffic volume and
required left turn onto Crawford Street makes delays lengthy and frequent.
Schilling Road traffic has access to 1-135 but the present configuration is
difficult during bad weather due to a sloping, circular on-ramp. This
interchange wi 11 be reconstructed as a conventi ona 1 di amond interchange
in 1992 which will upgrade safety and efficiency. However, Schilling Road
traffic must still transit a densely populated residential area and
elementary school zone located between the Airport Industrial Center and
1-135. .
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9uestion 8 - If new jobs are antici~ated as a result of the highway
lmprovement. is there a sufficient labor poo to fill those jobs?
Salina and the surrounding communities have an ample supply of labor to
accommodate new growth. Because of the diversity of Salina's economy.
it's labor force possesses a wide range of skills. Salina's labor force
declined slightly during the early 1980's but has grown gradually since then
and now totals 27.861. This compares to a figure of 26.925 in 1980 and
22.975 in 1975. The level of unemployment has held steady the last three
years and the Kansas Department of Human Resources estimates the current
unemployment rate for Saline County at 4.3%. Approximately 1.200 members of
the labor force are unemployed. In addition. a number of workers in Salina
and surrounding communities are underemployed and they prOVide an additional
labor pool to fill new jobs created in the Airport Industrial Center and
Ninth and Magnolia Shopping Area.
The Salina economy already draws workers from a large geographic region.
Approximately 78% of the 2.700 employees who work in the Airport Industrial
Center live in Salina. This means 22% of the workers commute to this area
from the surrounding region. Many of these workers commute to Salina from
the north and west via U.S. 81 and 1-135. An interchange at Magnolia Road
and 1-135 would greatly improve access for commuting workers coming from the
north and west who work in the impact area.
Question 9 ~ How will the highwa~ project affect the time, cost. and
safety of area resident's commute to thelr work places?
For workers commuting to the impact area from the north and west, the
requested interchange wi 11 reduce traveltime and improve safety. Instead
of exiting two miles north at Crawford Street and using internal city
streets or driving south to Schilling Road and backtracking. workers in the
mall area and the Kansas Tech campus area would be able to exit off the
interstate directly onto an arterial street that would take them to their
work place. The requested Magnolia interchange would also improve traffic
safety by keeping commuter and mall shopping traffic off of internal streets
like Crawford and Broadway and diverting it to a safer. faster moving
interstate. Unlike the present situation on Crawford. Broadway and
Schilling Road. if commuters and shoppers were able to exit directly on
to Magnolia. they would be able to get to shopping facilities and employment
centers without traveling through any school safety zones. Also, an
interchange at Magnolia Road would reduce the traffic volume and number of
turns at the Crawford Street - Centennial Road intersection which has been
the scene of 16 reported accidents so far in 1989. When businesses in the
Airport Industrial Center were asked in a survey what they felt should be
done to improve the general appeal of the area as a location for continuing
industrial development. several respondents pointed to the Crawford Street -
Centennial Road intersection as a problem.
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Question 10 - How will the quality of life in the impact area be enhanced
as a result of the highway improvement?
One enhancement that would result from a Magnolia - 1-135 interchange is the
potential for an attractive entryway to the Kansas College of Technology
campus. In its present alignment, Magnolia Road runs right to the eastern
edge of the heart of the Kansas Tech campus. There has been a proposal to
construct a campus entrance drive that would be aligned with Magnolia at its
intersection with Centennial Road. The corridor along Magnolia from 1-135
to Kansas Tech is largely undeveloped and construction of an interchange
would allow visitors to enter the campus area without traveling through an
industrialized area. This would enhance Kansas Tech's goal of projecting a
more traditional campus-like image.
The benefits to traffic and pedestrian safety were mentioned previously.
Currently, mall shoppers coming from the counties to the north and west
(Salina primary trade area) must exit on Crawford Street and follow
Crawford, Broadway and Ninth Street to the mall area. This requires
traveling through several school zones and residential areas. An
interchange at Magnolia would provide direct access to the mall area from
the interstate and would reduce traffic and enhance pedestrian safety on
city streets.
A third quality of life enhancement would be increased convenience and
reduced aggravation for travel ers. Currently, the shopping and service
facilities in the Ninth and Magnolia area are highly visible from 1-135 but
there is no means of access. You can see the services but can I t get to
them. To stop at a restaurant, a southbound traveler must drive one mile
south to the Schilling Road exit, then east to Ninth Street, then one mile
north to the Ninth and Magnolia area and then must backtrack to reach the
interstate. Direct access to 1-135 from Magnolia would greatly increase
the convenience for travelers seeking travel services, lodging and shopping
facilities. This accessibility should lead to increased retail sales as
well as an improved community image thru better access.
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