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2008-09-08
Spooner,WI. Wal-Mart Asks County For $1 Million Welfare Bail Out

Wal-Mart wants the small city of Spooner, Wisconsin to spoon-feed them money. On July 10, 2008, Sprawl-Busters reported that Wal-Mart, the icon of the free market, wanted the Washburn, Wisconsin County Board to prevent public land surrounding its proposed superstore from being sold to Wal-Mart competitors for 40 years. That's just one of the problems associated with this mercurial proposal from the giant retailer. Wal-Mart has waged an on-and-off campaign to build a 153,000 s.f. superstore in Spooner, Wisconsin on 35 acres of county land. This project has been in the works for three years. Last January it was reported by the Washburn County Register that the Wal-Mart supercenter project in Spooner was on hold. "There is nothing yet to report on the status of the project on Spooner," a Wal-Mart senior manager of public affairs said in an e-mail to Spooner Mayor Louie Villella. "While no decision has been made regarding the Spooner project, I feel it's important you know what's driving these decisions, and that you know these decisions are shaped by Wal-Mart's desire for a responsible and managed growth strategy. Again, there is nothing yet to report on the status of the project in Spooner, but my colleagues at Wal-Mart's headquarters in Bentonville expect this project to be reviewed in the coming weeks. I will of course keep you informed." Wal-Mart admitted that the Spooner Supercenter was in a "holding pattern" while the company tried to "manage our growth to insure the long-term success." After roughly four months in limbo, Wal-Mart announced in April that under new "business parameters," the supercenter project would proceed -- on a smaller scale than originally proposed. The Register reported that residents asked that the city council to slow the process down and prepare a developer's agreement carefully. One resident warned the Council that officials in Rice Lake, Wisconsin regretted that they had not conducted more research when they accepted a Wal-Mart Supercenter -- which caused their "smaller" Wal-Mart store to sit empty at a $200,000 liability. Another resident recommended an "advisory referendum" to see how many citizens wanted Wal-Mart in Spooner. In July, the Register reported that Wal-Mart had paid $30,000 to ask for more time to get its proposal in order. This would be the 8th such extension Wal-Mart has asked for, according to the newspaper. Wal-Mart's lawyer told the county another extension was needed to get the developer's plan and railroad modifications at the site, the latter of which must be done by the state. The developer's agreement was slated to come before the Spooner City Council in September, Wal-Mart said. One member of the County Board complained that Wal-Mart, in effect, had held their land "hostage, in a way" for more than two years. During this time Washburn County taxpayers haven't received any money from Wal-Mart, or any taxes. Their extension fees have all gone into an escrow account. If Wal-Mart ended its agreement with the county for the land, all the money in escrow would be distributed to the county. The County Board asked Wal-Mart what their response would be if the county did not allow any more extensions. Wal-Mart's lawyer had no immediate answer to that. The land agreement that Wal-Mart has presented to the County asks that the land surrounding the superstore not be sold to competitors. Wal-Mart has a list of stores it considers to be competitors. Wal-Mart wants a 40 year no-compete restriction on the surrounding lands. Washburn County has never been asked to restrict who can buy its land in this manner. Wal-Mart implied to the county that if this non-compete clause were deleted from the agreement, the retailer might pull out of the deal. At the city level, the Spooner City Council has apparently agreed to a memo of understanding on the project that requires Wal-Mart to pay offsite road improvements. But if the County does not extend its purchase agreement, Spooner's agreements would be moot. This week, Wal-Mart threw another expensive money wrench into the deal. Local residents tell Sprawl-Busters that Wal-Mart has told the County it now wants a $1 million welfare payment in order to move forward with the project. "Unbelievable that Wal-Mart finally did what we had been telling the county for almost 3 years," citizens wrote to Sprawl-Busters. "We told them they were not partners with Wal-Mart. This could be the way Wal-Mart walks away. The county has no funds and the city is looking into any state or Federal programs." According to the minutes of the September 8th, Washburn County Board, under the topic "Wal-Mart Update" the minutes state: "Committee discussed the meeting that was held as a result of a Wal-Mart request... with discussion centering around Wal-Mart' s request for a $1 million drop in infra structure charges and for the County or the City to input $1 million into the project or they will not be able to go ahead with the project." The Board then voted that the matter should be placed on the Agenda for informational purposes, "as Washburn County does not have monies to fund this request."

What you can do: Is this Wal-Mart's awkward way of ditching the project? This late in the game, after years of controversy and delays, Wal-Mart suddenly informs the county that it needs a big infusion of tax dollars to salvage this project. The retailer may feel that the county is desperate enough to sell their land, that Wal-Mart can gain some concessions from them in addition to their "no complete" land agreement. But the retailer may have gone too far this time. Neither the county, not the city can come up with $1 million in corporate welfare, or cut the infrastructure charges. The company which cleared $12.7 billion in profit this year, is not able to come up with the cash needed to make the Spooner superstore work. It's ironic that several weeks ago, at a Washburn County Democrats gathering, State Senator Bob Jauch said Wal-Mart "has set the book for tax abuse." According to the Register, Jauch said Wal-Mart creates a subsidiary where it places a store and charges that store rent, which gets deducted from its state taxes. Jauch said the money then is rerouted back to Wal-Mart. Wisconsin Democrats, however, have included a provision into state legislation that would prohibit companies from using rent as a discount for taxes. "We want to make sure that we don't gouge individual citizens because corporations aren't paying their share," Jauch said. Several weeks later, Wal-Mart unveils this $1 million welfare request. It has been estimated that the road upgrade costs that Wal-Mart will be asked to pay for could reach $4.8 million. In November of 2005, the land sale for $1 million was presented as 'top secret', with officials saying only that it involved a Fortune 100 retailer. By March of 2006 the Mayor of Spooner admitted the retailer could be "a Wal-Mart Concept". Finally it was revealed that Wal-Mart wanted to come to Spooner, despite the fact that there are two Supercenters 20 minutes away in two directions. The grass-roots citizens group Washburn County First (WCF) formed to get information out to the public about the negative impact this development would have on our small town retailers and the county at large. WCF filed a lawsuit against the county for open meetings violations and against the City Board of Alderman for alleged irregularities in granting a variance for the Supercenter with regard to highway access. The county admitted to one count of the open meeting violation, and paid a fine. The city is offering Wal-Mart welfare money to locate in town, putting them in a TIF (tax increment financing) district to offset taxes. Readers are urged to email Michael Bobin, the Chairman of the Washburn County Board of Supervisors at mbobin@washburn.wi.us with this message: "Dear Chairman Bobin, Wal-Mart has tied up your 35 acres of land for over two years now, with no financial benefit to county taxpayers to show for it -- not even a real estate tax payment. In addition, they are asking you for an unprecedented 'no compete' restriction on taxpayer-owned land. Now they have asked for a $1 million drop in infrastructure costs, and for the county or city to pay them $1 million. This is a totally inappropriate request on Wal-Mart's part, given they cleared almost $13 billion in profits for the year ending January 31, 2008. If a company with that much money cannot stand on their own -- then let the project fall from its own weight. Wal-Mart may be testing the county and the city to see how much they can get out of you, but Washburn County should get out of the deal instead, while you are still financially ahead. Its time to open up this land for other parties to purchase. Wal-Mart has had ample time to make its move, and for its own internal financial reasons, did nothing with this project for months -- even suggesting that the project might never come to fruition. It's time to draw the line. Supervisor Mackie is right: 'this land has been held hostage, and its time to set it free.' No corporate welfare for Wal-Mart."










 
 
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