Douglas County directs staff to finalize KU Innovation Park PILOT, asks staff to explore administrative fee

The Douglas County Board of Commissioners on July 8 directed staff to finalize a voluntary payment‑in‑lieu‑of‑taxes (PILOT) agreement with KU Innovation Park and to explore an administrative fee to cover county administrative costs.

Adam Courtney, chief executive officer of KU Innovation Park, outlined a draft framework the park and county staff have worked on over several months. "We structured it about a 10 year…so that we can go back after that 10 year period and review it and make sure it's working for both parties," Courtney said, describing a schedule that begins at $2.12 per square foot in 2027 and increments roughly 5% yearly to about $2.77 in year 10.

Lindsay Slater, vice president of strategic communications at KU Innovation Park, said the park has grown over 15 years to host about 77 companies and more than 800 jobs and that local and partner investment has helped the park leverage outside funding. "Our companies bring in funding too," Slater said, noting KUIP's reported figures on job and payroll growth and the park's use of public dollars for shared facilities and services.

Douglas County appraiser Brad Eldridge explained the rate calculation, saying the starting figure reflects a market Class A office tax rate with a programmatic discount. "We came up with that, based on the conventional class a office space model…we worked with 25% of what the fair market taxes would be," Eldridge said, adding that the county treasurer's office would calculate distributions so taxing entities, including the City of Lawrence, would receive their shares.

Commissioners pressed presenters on eligibility and administration. Courtney said the pilot would apply at lease renewals and target "mature, positive cash flow, for‑profit" tenants while excluding early‑stage startups, research tenants, nonprofits and vacant space. Commissioners also asked county staff and the appraiser to study whether an administrative fee should be deducted before distribution to cover county workload; staff said they would consult legal counsel and return with options.

Public comment included a Lawrence resident, Eric Hyde, who urged the commission to consider PILOTs more broadly for tax‑exempt institutions and expressed support for KU Innovation Park.

After discussion about timing — some commissioners suggested delaying implementation to 2028 if unresolved West facility payments remained outstanding — the board voted to direct staff to finalize the PILOT agreement with KU Innovation Park and to pursue analysis of an administrative fee. The chair announced the motion passed unanimously.

Next steps: staff will refine the draft agreement, research administrative‑fee options with legal counsel, and return to the commission with recommended language and any necessary memoranda of understanding or amendments before final adoption.