Lukewarm for Wal-Mart

Mayor opposed to incentives to lure retail giant


Confirmation that Wal-Mart is considering locating a store in Craig has sparked varying speculation.

Feelings are mixed about whether the news is good or bad for Moffat County.

Research indicates that the effect Wal-Mart has on a community is as varied as the communities themselves.

It's been less than a year since Wal-Mart opened a super center in Rifle. City officials couldn't be happier and report record sales tax revenue increases. Totals for November are 90 percent higher than the previous November.

"There were a lot of feelings on both extremes," Rifle Finance Director Nancy Black said about the climate before Wal-Mart's opening. "Shoppers were excited. Having a Wal-Mart here saves a lot of travel time. Businesses met it with mixed feelings."

Those feelings included fear that Wal-Mart would drown out the little guy and hope that it would bring more customers, Black said.

"Wal-Mart can enhance your business just by being here," she said. "For a majority of businesspeople, I think Wal-Mart has helped."

Both have happened. Wal-Mart's arrival shut down some longtime Rifle stores, including a hardware store and a Ben Franklin. Others have prospered, and still others have found a new home in Rifle.

The small town now boasts a Starbucks.

"Three years ago, who would've even thought a Starbucks would come to Rifle?" Black said. "Wal-Mart makes this a favorable environment for drawing new business."

The city developed a commercial business park that is filling fast, and there are plans to build a Sears store in the town.

But some doubt exists that Craig would have the same experience. Before Wal-Mart's opening, many of Rifle's 7,800 residents traveled out of town to shop, having few alternatives to find most of the basics Wal-Mart offers.

Craig residents don't have the same deficiencies. A Wal-Mart super center would compete directly with Kmart and Craig's two grocery stores as well as a few specialty stores whose wares are similar to what Wal-Mart would offer.

City Manager Jim Ferree thinks Wal-Mart's primary customer base would be taken from existing businesses. Residents in surrounding towns already have access to a Wal-Mart, with stores in Steamboat Springs; Rifle; Vernal, Utah; and Rock Springs, Wyo.

It's too early for downtown businesses to be concerned about the potential effect, Downtown Business Association President Karen Brown said.

"Right now, we're pretty much waiting," she said. "It's made everyone think, but we won't make a plan until we know for sure."

Mayor Dave DeRose isn't waiting. He made a list of oft-used household items and priced them out at Kmart, Safeway and Rifle's Wal-Mart.

"I certainly wouldn't drive to Rifle to save money," he said.

His investigation found that, although Wal-Mart had low prices, it wasn't always the lowest prices.

"Rifle didn't have anything before," DeRose said.

"If (a Wal-Mart) came here, it would probably hurt one of our big businesses and lots of our little businesses. I don't want to see empty buildings."

He contends that when a Wal-Mart moves into a town, its per capita wages fall.

Business Week reports the average wage of a Wal-Mart associate is $8.23 an hour, which equals $13,861 a year.

"It wouldn't bring new jobs, it would just shift existing jobs," DeRose said. "The 'give us something' scenario needs to be tempered with a 'give us the right thing' scenario."

A 2004 Pennsylvania State University study indicated that between 1987 and 1998, the more Wal-Marts opened, the higher the family poverty rate in that county.

DeRose already has planted the seed among Craig City Council members to think about how they'll react if Wal-Mart asks for incentives to build here.

He is vehemently opposed.

"If Wal-Mart comes here, let them pay their own way," he said. "There's no reason to give them a dime in incentives. If they feel we're a good enough economic model, then they can afford to pay their own way."

It's too early for much talk to have reached the Craig/Moffat County Economic Development Partnership offices. Director Tom Flavin said he has had no contact with Wal-Mart and the partnership has not been recruiting the super store.

"Our focus has been on rejuvenating existing businesses," Flavin said.

But, he said, there are pros and cons to the proposal.

"I'd rather have a big retailer, like Wal-Mart, interested in you than no one at all," he said. "Immediately, you have to consider the potential impact on existing retailers. I don't think any of us know quantifiably what that impact will be. Sometimes, it just transfers retail activities to one location."

The town of Rifle didn't offer Wal-Mart incentives, but it did offer them to the developer, including assistance with infrastructure costs and is "sharing back" 40 percent of the gross sales tax collect by Wal-Mart with the developer.

When Kmart opened in Craig, the city provided an estimated $60,000 to $80,000 in incentives, which included extending Industrial Avenue and constructing a retention pond.

The sales tax revenue generated by opening that store justified the city's investment, DeRose said. He doesn't see Wal-Mart having that kind of effect.

Wal-Mart officials confirmed earlier this month that the company was looking at property in Craig, but said that it was too early to know whether that means a store will be built here.

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