Costco

Sorry, but I am still suspect about the the necessity of the COSTCO Tif. I think my main concern comes from the fact that COSTCO is not a company that likes TIF’s. As I understand it, they really didn’t want it, this was more of a developer want then anything.

The developer claims that the site is still contaminated even though, at one time, the city got a letter from SD DENR saying otherwise. (This has been confirmed by several people – in fact, someone reminded me this morning there was plans to build a ‘Children’s safety park’ at the location after the tank farm left. Would the state sign off on the site being clean enough for a children’s park if they knew it wasn’t?)

That being said, if the TIF was really only needed to reimburse costs of environmental clean-up it has gone above and beyond that. Was the contamination claim a ploy to get the TIF? I think it is being used as a true incentive to “land” Costco which had already landed, as I said in earlier posts. COSTCO doesn’t publicly announce something unless the ‘I’s’ are dotted and the ‘T’s’ are crossed.

What’s really interesting is that at the beginning of 2011 a representative of COSTCO visited the City – one of the things they made very clear was that they weren’t interested in a TIF.  They do not like the perception it can create that they are taking taxes from the school district.  Instead they mentioned that they typically request a sales tax rebate so that any incentive they receive is soley based on how well they, as a business, perform.

It seems the issue is residing with the developer and not the retailer at this point.

Questions remain;

• Why did the City set a precedent for offering a TIF outside of the core for a retail project?

• What does this mean for Sioux Falls three years from now in terms of the number of districts we have and tax base that is not being allocated to the taxing entities?

• Why didn’t Target at Dawley Farm then receive a TIF?  They did request one.

• Why aren’t we justifying the use of the incentive anymore?

I guess the city council received a DRAFT policy that they could discuss in reference to the use of a TIF, if not for any other reason than to have them acknowledge that there should be a policy that the administration can utilize when dealing with developers so that everyone knows what the rules are and the administration can stand behind those rules moving forward and developers / property owners demand that their projects go to Council and supercede the administration.

Why hasn’t the council seemed interested in pursuing these policies in the future? Seems the rubber stamp is an easier approach.