Mesa OKs $42 million to court megastore
City trying to lure Bass Pro to center
The Arizona Republic
Aug. 20, 2004 12:00 AM
The battle among Valley cities to lure high-profile retail developments continued Thursday as Mesa offered an incentive package worth $42 million for a leisure, shopping and business project.
The offer would bring a Bass Pro Shop, the sporting-goods chain's second in the West; a 16-screen Cinemark movie theater, that chain's first in the Valley; and a Super Wal-Mart.
The development would include restaurants, an auto mall and a commerce park at the site Mesa once offered for the Arizona Cardinals football stadium now under construction in Glendale.
"I'm not a big fan of incentives . . . but I will take 50 percent of a larger number than 100 percent of zero," City Councilman Rex Griswold said.
The incentives for developing the 240-acre vacant site at Dobson Road and Loop 202 include $34 million in tax breaks and rebates; $6 million for streets and utilities and $2 million in impact and permit fee waivers.
The announcement was Mesa's response to an ongoing retail mall war with Tempe, which is acquiring land from private owners in its quest to build a Desert-Ridge-type shopping center on Loop 202 just two miles west of the Mesa site.
But Tempe Mayor Hugh Hallman didn't see it as a battle, instead hoping both developments could "complement each other" and become a regional retail force.
Miravista Holdings and Vestar Development plan to build Tempe Marketplace at McClintock Drive and Rio Salado Parkway.
The city's development agreement with Miravista includes $50 million in incentives. Its agreement with Vestar includes more than $35 million in incentives for 1.3 million square feet of retail space.
Meanwhile, Chandler and Gilbert have been tussling over the location of a super auto mall, and sales tax rebates include $60 million for Gilbert and about $40 million for Chandler.
Other Valley cities have used subsidies to attract developers, including Glendale for the Arrowhead Town Center in Glendale and Phoenix, which offered a subsidy to get a high-end auto mall on the Phoenix-Scottsdale line on the old Chauncey Ranch property.
Two years ago, Mesa offered the Dobson property, controlled by the Hurley family for more than a century, as a location for the Cardinals stadium, but residents such as LaRue Gates shot down that plan.
Gates and others viewed a stadium as a money pit that would never pay for itself.
Today, the 17-year Mesa resident supports the Bass Pro plan so far.
"I say, 'Let's go for it,' " she said. "Forty-two million dollars I can live with. It's still in the ballpark of what the stadium was going to be."
City Manager Mike Hutchinson said Mesa was committed to bringing high-quality projects to the site after the stadium plan failed.
Business owners also like what they see so far but are waiting to read the finished incentive package.
"At first glance, it seems like a good plan, but the devil's in the details," said David Molina, president of the Valley Business Owners and Concerned Citizens Inc. "In our dealings with the city, trust but verify."
The Valley business group is currently backing a referendum to roll back Mesa's sixth utility-rate hike in as many years. The city has been scrambling for new revenue sources since the post-9/11 downturn.
The City Council voted 5-1 Thursday to negotiate a development deal with De Rito Partners Development Inc. and Kimco Developers for the plan called the Riverview Project at Dobson. It will hire Ernst & Young to prepare a market analysis of the proposal.
"This is not a done deal today," said Council member Claudia Walters, who represents the district where the development would be built. "This is a kicking off of the public process."
Councilman Tom Rawles voted against the motion for a reason he did not want to discuss publicly.
Rawles said he was concerned with an item on the incentive list. Mayor Keno Hawker abstained because his back yard abuts the mall site.
A pedestrian-oriented theater district on 30 acres would be the first phase of construction, which could begin in about 18 months.
That includes a 57,000 square-foot Cinemark theater, the second the national chain would locate in Arizona, and 103,000 square feet of retail space.
"This is going to be a place where you want to be," said head architect Robert Saemisch of Saemisch DiBella Architects Inc., which will design the theater.
Future phases include the Bass Pro store on 25 acres, a 110-acre retail district where the Super Wal-Mart would locate, a 30-acre auto mall and a 45-acrecommerce park.
Bass Pro Shops, an outdoor sporting-goods giant that sells everything from rods and rifles to hunters' underarm deodorant and camouflage infant booties, attracts millions of tourists annually.
The Missouri-based chain is opening its first Western store in Las Vegas on Nov. 11. Saemisch estimated that the 180,000- to 200,000-square-foot store in Mesa could attract 2 million tourists a year.
The developers' proposal will be considered at several City Council sessions and planning and zoning meetings.
The city also plans to hold several public meetings on the development.
Who is Hugh Hallman? I though Tempe's mayor was that Peter Puffing Homo, Neil Guliano!
(Hugh must be his Homeland Security Advisor.)
I think Guiliano finally retired to go chug cock elsewhere than the upsidedown pyramid...
Hallman got elected.
The use of taxpayer money to "lure" businesses is repugnant, no matter what business it is.
Will Glendale give a Blimpie's owner a multi-million (hell---multithousand) dollar tax break like that? I mean...sales taxes in Glendale and jobs, too...?
Answer is no. No city will.
It's bullshit and taxpayers should be outraged.
I'm sure the city is thinking about their new tax source is trying to bring in buisiness. Maybe a $40 million dollar investment isn't a bad thing if the city stands to make $10 million a year in income.
Why don't they try creating a business environment where they don't have to give taxpayer-funded bribes/kickbakcs/payoffs (which is all this is) in order to attract businesses.
I can't imagine that residents wouldn't like their portion of the $40 million instead of it going to a government-funded giveaway.
Better than spending money on a stadium.
Tell me about it. I spent enough of my own money trying to get it stopped.
I'm with TimW on this one. I'm repulsed by the basic principle of using taxation as a means to coerce or bribe individuals to do or not do something.
AMEN !! The business should move in because its a great market and a great city, not because the local politicians pay them off.
I get teh feeling that some folks are for this because they are blinded by the fact that its Bass Pro Shop. If it were a Davids Bridal Megastore i think they would be singing a diferent tune.
And honestly does Mesa really need yet annother automall? sheesh.
I'm surpised this development is going through without a lot of complaints because of the Super Walmart. Most people hates those.
City of Mesa is probably helping push this project through strictly becuase of sales tax benefits.
Here's one thing to think about when you hear about Cities giving developers breaks and incentives. None of the money is cash the city is giving these guys up front. It is all future money the city is going to receive from the developer once the project is done. If the project doesn't get built, the city doesn't get anything. Also, developers are given breaks on impact fees to tie into city utilities but the developer has to pay for the installation for all public utilities to their project. This usually means installing water and sewer main lines in all adjacent streets which could be 2-3 miles. Very expensive. They are doing work the city will have to do later and the city doesn't pay for it. It's a win-win situation for the city.
The $42 million is nothing considering the city will be getting $10 million a year in sales tax.