Jackson County Circuit Judge J.D. Williamson made the ruling in a case in which the county had sought to foreclose on properties owned by the Land Clearance for Redevelopment Authority, or LCRA, and by the Planned Industrial Authority of Kansas City, or PIEA.

The properties, which had been acquired by the agencies as part of public-private redevelopment efforts, were delinquent in the payment of their real estate taxes. Although the Missouri Constitution exempts from taxation property owned by government entities, the county contended that the provision did not apply to back taxes.

'It's an important decision, because projects like the Jazz District and the Entertainment District downtown involve the city assembling properties for redevelopment,' said Dick King, an attorney who represents the LCRA and the PIEA.

'In the case of the Entertainment District, where the TIF Commission is acquiring properties, many of them were subject to back taxes or taxes accrued this year. So there was a concern that the county would go after them.'

The properties at issue included the former Rival Manufacturing Co. plant in the Leeds district, now occupied by Weld Wheel Industries Inc.; an office building at 720 Oak St. downtown; and a building in the West Bottoms.

The county was seeking nearly $150,000 in back taxes, interest and other costs on the Oak Street property, nearly $103,000 on the Rival property and $6,671 on the West Bottoms property.

In dismissing the county's foreclosure petition, Williamson ruled that, because the properties were exempt from taxation, Jackson County's collections director had failed to state a recognizable legal claim.

This issue has arisen before. More than 15 years ago, after the LCRA helped private developers build the Vista Hotel (now the Kansas City Marriott Downtown) and the AT&T Town Pavilion downtown, the county sought to tax the LCRA for its ownership interests in the projects. The circuit court found that the LCRA was a part of city government and exempt from taxes under the state constitution.

On appeal, the county argued that the LCRA operated as an independent agency and not a redevelopment authority. The Missouri Supreme Court disagreed, finding that the LCRA was a political subdivision of the city and therefore tax-exempt.

The LCRA typically carries out city redevelopment policies by acquiring properties and reselling them for private development. Allowing the county to pursue taxes on the properties would increase the costs of private redevelopment, which in many cases would make redevelopment unfeasible.

Michael O'Flaherty, director of assessment for Jackson County, said he agreed that the LCRA and PIEA weren't subject to taxation but was unable to say why the county pursued the foreclosure suits.

'Maybe it was an oversight, because the decision to dismiss is a fair reading of the (Supreme Court) case,' he said.