Smiley Face, Sad Face
God bless you, Wal-Mart.
The world’s largest retailer takes a lot of crap. But I come today with praise for Mr. Smiley Face.
I’m not going to write about energy efficiency at the new Wal-Mart on the site of the old Blue Ridge Mall. Airtight milk coolers are nice and all, but we’re still talking about a company with a truck fleet that burns 100 million gallons of diesel a year.
No, what I like about Wal-Mart is its brutal honesty and the foolishness it exposed.
The new store on U.S. Highway 40 (behold, waterless urinals!) opened on January 19. A day earlier, however, another Wal-Mart closed — that old colossus, once known as Hypermart USA, near Bannister Mall.
A more artful corporation might have tried to stagger the two events. The Blue Ridge Mall site, after all, got a lot of help — in the form of public money — from Kansas City, Missouri. City officials made the deal thinking that the new Wal-Mart would generate $20 million in new tax revenue.
But that $20 million won’t spend as well when a Wal-Mart eight miles away simultaneously disappears from the tax rolls. The death of the store at Bannister Mall adds another vacancy to what is already a concrete netherworld. “We have a huge black hole out here,” says Lou Austin, a lawyer who fights for the neighborhood.
I feel bad for Austin, but I love that Wal-Mart didn’t try to hide the fact that the city was netting a big zero in terms of stores. The bosses in Bentonville, Arkansas, could have kept both stores open for a while, just for appearances. Then, say, six months from now, we’d learn that, shucks, the numbers on the Bannister Wal-Mart just didn’t work anymore.
Instead, the merciless retailer padlocked one store just as it was stringing a ribbon in front of another. Hey, Wal-Mart didn’t get where it is today by being sentimental.
The new Supercenter anchors a $90 million development. The project benefits from tax-increment financing, a tool that lets developers keep some of the new taxes generated by their projects. The Blue Ridge Mall redeveloper will get back $27 million from TIF, under a plan the city passed in 2005.
TIF is a powerful instrument and, like a gun, should be used responsibly. Kansas City regularly fails in this regard. It keeps TIF under the sink, next to the whiskey, where the kids can get at it.
The Wal-Mart TIF is a perfect example of the city’s carelessness. The TIF plan itself is 383 pages. Yet I couldn’t find a document in the stack that addresses the possibility that the Bannister Wal-Mart would close. Instead, the plan described the creation of 1,535 new jobs. In fact, a lot of them have just migrated a few miles north.
City Councilwoman Becky Nace chaperoned the Blue Ridge Mall redevelopment. She’s proud of it, too. “My project,” she calls it.
I called Nace to ask if the Bannister Wal-Mart had come up in talks about the Blue Ridge Mall redevelopment. “That was never, ever, ever discussed,” she says.
Why not? “The two are not interconnected,” she says. (True, the two stores are in different City Council districts. Want to guess which store — the new one or the dead one — is in Nace’s district?)
Mayoral candidate Nace says the Bannister Wal-Mart’s fate was sealed a decade ago, with the sudden decline of the shopping center. The projects are not linked, Nace says, because the new and closed Wal-Marts draw different customer bases. “Blue Ridge Mall competes with Independence, period, and has a nice location on the freeway,” she says. Still, the stores are close enough that a banner hanging from the Bannister Mall Wal-Mart invites people to shop at the new place on U.S. 40.
Nace is right when she says the Bannister Wal-Mart was in jeopardy, no matter what the city did for the new kilowatt-cruncher. But, c’mon, in a 383-page report, can’t we get a sentence or two along the lines of, “Construction of new Wal-Mart may accompany closing of existing Wal-Mart. Prepare accordingly”?
Instead, we’re fed nonsense. Nace is telling folks at candidate forums that the new Wal-Mart got no tax relief. “They bought the ground at market rate,” she tells me. “They built the building at their own cost, and they pay full taxes.”
Please, Becks. The “market rate” ground that Wal-Mart bought was prepared for construction with foregone tax dollars. Of the “full taxes” Wal-Mart pays, a portion goes back to the developer of the project, who gave $1,000 to your campaign, I noticed.
Nace at least votes against the occasional TIF project, which is more than can be said for other council members. Two weeks ago, Bob Cornwell, a government financial adviser from San Francisco, came to City Hall and talked about the city’s use of incentives. Cornwell suggested that the city close its legs from time to time. “You don’t have to chase everything that comes to you,” Cornwell told the city’s Finance Committee.
Councilmen Chuck Eddy and John Fairfield, mayoral candidates who sit on the committee, preferred to focus on the positive. Fairfield wanted Cornwell’s report to detail all the private money that Kansas City had been able to leverage with TIF. When Cornwell showed a slide that described incentives as “investments,” Eddy chortled with delight. “This may be the truest statement page you’ve had,” he said.
I do give Eddy credit for acknowledging, as he did during the Cornwell presentation, that TIF didn’t reach enough depressed sections of the city. That point was made oh-so-evident in a recent study by University of Missouri-Kansas City economist Michael Kelsay, who found that the city’s most poverty-stricken areas got the least amount of TIF. The 3rd and 5th districts, where minorities outnumber whites, account for just 12.1 percent of the city’s TIF plans, according to Kelsay’s research. Former city auditor Mark Funkhouser, who is also running for mayor — and whose audits provided the basis for much of Kelsay’s work — called that discrepancy “obscene” at a candidate forum last month.
The day after Eddy made his comment about TIF, I drove to the Bannister area to see what the city’s “investments” had left behind. I met a woman at the bus stop near the recently deceased Wal-Mart. She said she had worked as a cashier there. She was waiting for a lift to the new store on U.S. 40.
The woman, who did not give her name, said her hours had been cut with the move to the new store. Once full time, she was on this week’s schedule just two days. A lot of the Bannister Mall Wal-Mart veterans, she said, are upset that they now must fight with new hires for shifts. “They really dogged us.”
A moment later, her bus arrived. In the city’s cold calculus, she was technically one of 1,535 new workers. The pissed-off look on her face told another story.