Making a big box fit
EAGLE ” After months of listening to the public talk about the so-called “Red Mountain Ranch” project, Eagle Town Board members are doing some talking of their own.
Given the variety of opinions offered at two recent work sessions, reaching a consensus about the controversial shopping-and-residential complex east of Eagle will likely require more meetings.
The town is particularly interested in how to share revenue with the owners of the complex and whether residents will get to vote on the project known as Red Mountain Ranch.
Local developer Merv Lapin and his partners are ready to build on 442 acres of land immediately east of Eagle. The complex could include a Wal-Mart-sized store, which Red Mountain Ranch consultant Braun referred to as a “national.”
“If you don’t like the idea of retail centers, nationals, or the notion that the town needs a fiscal infusion, none of this matters,” Braun told the Eagle town board last week. “If you believe this could be good for the community, let’s roll up our sleeves.”
Lapin and the town have discussed splitting sales tax revenue 50-50 for a limited amount of time. It is not unusual for a town to allow a developer to use sales tax to pay off construction debts.
But the concept isn’t winning supporters in Eagle. Board members Kraige Kinney and Ed Woodland have adamantly opposed revenue sharing. Kinney noted revenue wasn’t shared with the Eagle Ranch development, but later said he would consider, at most, a 1 percent sales tax share with a time limit.
Woodland suggested the developer pay the estimated $10 million to $12 million in construction by establishing a special taxing district, which would sunset after the debt is paid off.
“This puts all the improvements on the applicant’s plate. He can finance it as he sees fit,” Woodland said. Alternatively, if revenue sharing is allowed, Woodland said it should only start after the development generates $100 million in retail sales.
Board member Jay Bryant also opposed revenue sharing with the developer. And board member Paul Witt said he has never supported revenue sharing to pay for construction.
“If $3 million is going to send Costco down the road, so be it,” he said, referring one of the stores developers say is interested in opening at Red Mountain Ranch.
Witt said he might support sharing sales tax for smaller projects like a roundabout on Highway 6.
Mayor Jon Stavney voiced support for the 50-50 proposal, although he suggested that the sharing not start until the complex generates $80 million in retail sales.
But Lapin warned of a deal breaker. “If there isn’t revenue sharing, it is unlikely the project will go forward,” he said.
Braun said the revenue sharing allows a town to invest in a project, and make sure that it happens. The theory is that the project will eventually generate a healthy amount of sales tax revenues which the town will receive.
“The rewards come after the anchor store comes in,” Braun said.
Lapin said he doesn’t have a deal with any major chain, but is negotiating with Costco, a bulk retailer. Without a revenue sharing agreement, a such a store would have a problem competing, Lapin said.
Avon, for example, gave the developer of The Home Depot and Wal-Mart all sales tax revenues, which won’t go to the town until construction debts are paid off. That developer, however, built all the infrastructure at the complex.
Woodland, who said he was “hanging by a thin thread on opposing the whole project,” said Costco is a condition of approval.
“Without Costco, we have no project. With Costco, we can at least begin discussions,” he said. Stavney, too, wanted a big anchor store commitment up-front. “I don’t see this project as viable without a big anchor,” he said. “If it’s not a success, I don’t want it to happen at all.”
Lapin said he needed an anchor store that would generate $60 million to $80 million in annual sales.
The board has also talked about requiring all stores in Red Mountain Ranch be bigger than 3,000 square feet. The intent is to discourage store that would compete with businesses in downtown Eagle.
Kathy Heicher can be reached at kheicher@CMNM. org.
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