West Milwaukee, WI. Village Offers Millions In Tax Welfare For Wal-Mart
Most residents in the tiny village of West Milwaukee, Wisconson learned about a proposed Wal-Mart superstore in their community last June, when an article appeared in the Milwaukee Journal Sentinel -- but Village officials had been at work on the project before the public knew what hit them.
The site is being developed by a Tennessee-based company called Gatlin Development, which has sparked controversy over a number of its big box stores in several states. The 15 acre site being considered has a dead Sentry grocery store on it, and some buildings from the Wisconsin Steel Industries. Gatlin claims they will build the store and lease it to Wal-Mart -- but a competing retail firm says that Wal-Mart outbid them for the site.
The 147,800 s.f. store had an open house several months ago, hosted by the Village Board and its President Ron Hayward. The Board is required to vote on the project, but some residents feel the outcome of the vote is already decided.
Residents had been expecting that a Woodman's Food Markets would be coming to the site, but last year that project collapsed. One of the owners of Woodman's said that Wal-Mart had out bid them for the property. The proposed site is within 10 miles of as many as six existing Wal-Mart stores -- so village residents already have easy access to what the new store will offer. The trade area is saturated with existing big box stores.
Just as the site announcement for Wal-Mart was a surprise, residents were also surprised to learn in August that the village's Community Development Authority had offered Gatlin a Tax Increment Financing (TIF) deal that amounted to a $4.6 million subsidy to Wal-Mart. Under the TIF deal, the village would pay for millions in site development work: road improvements, sewer, water mains, and a storm water management facility. These site upgrades would be paid back over six years using property taxes collected from the project. That means for the first six years of the project, the taxpayers of West Milwaukee will see no revenue from the project for village operating expenses, police, fire or schools. Instead of asking Gatlin or Wal-Mart pave their own way, Village taxpayers are offering the development a large welfare subsidy. Such TIF districts are not available to small business competitors.
Wal-Mart has told local officials that its store will generate 250 to 300 jobs, of which 40% would be part-time. What the retailer did not explain is that most of its sales will be 'captured' from existing retailers in the Village, including the new Target less than a mile away, and several area grocery stores. So the jobs figure from Wal-Mart is a gross figure, and does not net out the losses that will occur elsewhere in the trade area. Because the village population of 4,200 is not rising, a large new retail entrant only ends up splitting the existing retail pie in thinner slices for everyone. This new capacity is not a form of economic development, but a form of economic displacement.
What you can do: It generally takes a year to build a Wal-Mart superstore, and company officials have told the Journal Sentinel newspaper that they hope to open the facility by late 2012. So the company is clearly expecting the Village Board will support the project at its September 19th meeting.
Readers are urged to call Village President Ron Hayward at (414) 321-9059 with the following message:
"Dear President Hayward, The proposed Wal-Mart supercenter for the village adds no value to our local economy, because as much as 80% or more of its sales will be transferred from existing cash registers. Not only from places like Target and local grocery stores, but from other Wal-Marts in the trade area. Shoppers in West Milwaukee have plenty of venues to find cheap Chinese imports. We are flooded with big box stores. Squandering another 15 acres for this purpose will not create more jobs and taxes.
This project certainly should not be subsidized under any circumstances by the taxpayers. Why should the hardworking village taxpayers have to financial prop up Gatlin or Wal-Mart? For six years we will watch their property tax payments go to pay back the village for work being done specifically to improve Wal-Mart's site. Let this huge corporation stand on its own legs, and not use public welfare. Under no circumstances should this project go forward with a TIF subsidy. No more corporate bailouts! If a handout is needed, then let the project die.
This project is not compatible with the purpose of our zoning code, which is to prevent sprawl and undue congestion. I urge you to vote no on September 19th, and to attach no tax subsidy to the plan."