City Council Minutes 1999 03 16 - Laserfiche WebLink

Home Browse Search

were whether that was truly the dollar amount to change the Sam's Club prototype and was the prototype initially up to City standards anyway. Mayer replied that this wasn't an incentive. The City could not require it on the PUD, therefore these monies were expended in order to bring the project up to the Commercial Development Design Standards & Guidelines. However, it appears that the City could have required it under the Commercial Development Design Standards & Guidelines and had a legal right to do so. Light replied, yes, that is correct. He stated that whether the City wants to use those findings or basis with which to enter into a sales tax rebate agreement is, as of yet, undecided. The Council hasn't approved specific findings as to why the City would want to enter this agreement, they are still in draft form. Mayer stated that, in some ways, he is less concerned with the legal rationale than what rationale was used to justify this program. He felt that it has been effectively dispensed that the City had to essentially provide the money to bring the project up to the guidelines. The City could have required that quite clearly anyway. Also, did the City of Louisville have to provide Sam's Club with an incentive to come here. He did not believe an incentive was required. He questioned where Sam's Club would have gone otherwise. Boulder wasn't letting 'big box' stores in. Home Depot, according to the Boulder Business Report would have offered the City of Boulder one million dollars in open space if they would let them into Boulder. It's clear that these businesses wanted to be as close to Boulder as possible. Superior already had Costco, leaving Broomfield as the only serious competitor. The question with Broomfield was whether there was any ready site off the highway, as Louisville had. He felt it was obvious that going to Broomfield would have engendered a minimum delay of six to twelve months in terms of a project approval. It could have very well been an even longer delay, if they had to go back through the process to get a site ready to develop. The consequences would have been a loss of revenue and their competitive advantage with Costco. There would also have been a loss of expenses associated with choosing and planning a site from Louisville. They would have moved to a site that would put them at a competitive disadvantage for the Boulder market. The farther that Sam's Club moved from Boulder, the better Costco's situation would be for attracting Boulder retail traffic. It would have also squeezed Sam's Club between the Costco by the Westminster Mall and the Superior Costco. He stated that consumers don't typically pay for membership in two different membership warehouses so opening first was crucial to Sam's Club. He explained that he recently spoke with a marketing employee for Sam's Club. The employee mentioned that Sam's Club was giving away thousands of free memberships, something that she said had not been done anywhere else. He felt that it was easy to translate thousands of free memberships into a significant six-figure cost, which was being done, effectively, as a preemptive strike against Costco. If Sam's had moved to Broomfield, they would have lost all of that. He felt that there was great doubt whether Sam's Club would have moved to Broomfield. He said it was mentioned on the videotape of the Council meeting, that Home Depot paid $100,000 less cash-in-lieu than they should have. He explained that he proposed increasing Home Depot's cash-in-lieu from the required $175,000 to $225,000. He stated 18