Always Low Prices?

Terry Riley has gone to Blue Ridge Mall to shop and see movies since he was a kid. The mall has been dying a slow death over the past few years, so the 5th District City Councilman welcomes new business opportunities. He wonders, however, about the wisdom of making Wal-Mart the shopping center’s savior.

Bernard Craig and his partners in the Blue Ridge Redevelopment company want to level the nearly abandoned mall, making room to pave ground for a 200,000-square-foot Wal-Mart Supercenter surrounded by yet-to-be-named shops.

All Craig asks is that the city grant him $25 million in tax-increment financing. Kansas City’s Tax-Increment Financing Commission first approved the deal on October 13. In the coming weeks, the city Planning Commission will recommend that a street behind the development be improved at an estimated cost of $1 million. Craig has asked that this be included as part of the TIF funding, bringing Blue Ridge Redevelopment’s requested tax break to around $26 million.

Once the TIF Commission approves any amendments, the City Council will decide whether to approve Craig’s request. That decision is likely to come after the first of the year.

Craig tells the Pitch that Wal-Mart will not benefit from the tax break but instead will pay top dollar for the land and will cover the entire cost of construction for the new building. “Everyone, including the city, hopes it is a success, so this area will become a taxpaying citizen,” Craig says.

The new shopping area covers about 80 acres, with Wal-Mart taking up a quarter of the land on the eastern edge. It will cost between $75 million and $100 million to rebuild the mall, Craig says, so he needs the $26 million in public funds to level the current mall, build better roads and parking lots and put in landscaping to attract new businesses. Although he insists that Wal-Mart is not benefiting from the TIF money, Craig’s attorney, Spencer Thomson, told TIF commissioners at their October 13 meeting that the Wal-Mart would bring a rush of consumers to tip the tax base back in favor of the city. He said the developers had made commitments to Wal-Mart.

Clearly, those developers aren’t alone. At the end of 2003, Missouri was home to 56 Wal-Mart discount stores, 58 Supercenters and 3 distribution centers. Fifteen of those 117 structures were built with the help of public subsidies totaling an estimated $64 million in tax relief, according to Philip Mattera, research director at Good Jobs First, a nonprofit organization in Washington, D.C., that studies economic development.

“We tend to think it’s bad to use public money to subsidize the biggest and most profitable corporation in the world,” Mattera says. Wal-Mart stores across the nation have received more than a billion dollars in incentives to help get off the ground, he adds.

“I don’t have anything against Wal-Mart,” Riley says. “I think it would be great to revitalize that area. However, I want Wal-Mart to come in here and take care of their employees.” Riley notes that workers across the country have complained that Wal-Mart does not allow them to put in 40-hour weeks, doesn’t provide them with good benefits and won’t let them unionize.

Riley has met with neighbors of the Blue Ridge Mall and says that residents seem to have a positive feeling about the project so far. “If that’s what the community wants, how can you fight the people in the community?” Riley says. He adds that he will visit with neighbors one more time before the TIF application comes up for vote by the council.

His fellow 5th District representative, Becky Nace, has spent the past few weeks calculating potential funding deficits to the Raytown C2 School District if the tax break goes through. Also, she says, Wal-Mart officials considered neighborhood concerns about noise and traffic. “Wal-Mart was more than happy to agree to the changes to benefit the neighborhood,” Nace says.

But Wal-Mart’s reputation for hurting nearby businesses makes others nervous about the company’s entry into the neighborhood.

Cosentino’s Apple Market sits a few blocks away from Blue Ridge Mall. At 4 p.m. the day before Thanksgiving, its aisles were sparsely populated, not bustling with shoppers picking up last-minute items for the next day’s feasts.

A Cosentino’s manager who declined to give his name said he was concerned about the arrival of a Wal-Mart Supercenter. He said he was relying on his loyal customers, some of whom have shopped at his store for decades, to keep Cosentino’s afloat if Wal-Mart becomes his competitor.

John Morrison, state director of the Springfield-based Missouri Grocers Association (of which Cosentino’s is a member) says it’s a shame when a company like Cosentino’s, which has been around for generations, is bullied out of business by impersonal megastores.

Morrison says the project could be a zero-sum game in terms of tax growth: The neighborhood’s tax base would center on Wal-Mart even as revenues declined at nearby businesses, shifting blight from one place to another.

Anita Henley, who has lived across the street from Blue Ridge Mall for the past five years, says she remembers when the area’s retail stores drew shoppers from across the metro.

She agrees the land could use a fresh start. But like many others, Henley wishes anyone but Wal-Mart were the driving force in the project.

“I don’t like seeing the mall empty, but on the other hand, Wal-Mart makes me sick,” she says. Henley avoids Wal-Marts in other shopping centers because she always ends up with 15 items in her basket she didn’t intend to buy.

Though Henley is wary of Wal-Mart’s empire status — she recently had a laugh when she saw a joke photo of Wal-Mart erecting its first store on Mars — the convenience of having the store a short walk away likely will send her there to shop.

Of the world’s largest retailer, Henley says, “They can afford to pay taxes better than anybody else.”