Welcome, Kohl's, Sears
Saturday, June 19, 2004
The development deal that enticed Kohl's Department Stores and Sears Roebuck and Co. to build stores in Cape Girardeau goes into the win-win column every city strives for in trying to attract new business.
The announcement last week by Mayor Jay Knudtson followed a year of negotiations with the companies.
The arrangement uses the retailers' money to finance improvements that will benefit both the stores and the city. The city will return the money to the stores over a period of years through the new sales-tax revenue they generate. In Kohl's case, some city and county sales tax revenue created by the store will be used to pay back $2.1 million in improvements -- including construction of a street -- needed at the store's site near the Lowe's Home Improvement Warehouse on the city's west side.
Sears will pay for $4 million in public improvements on Siemers Drive. The company will be repaid over 15 years by city and county sales taxes on revenue that exceeds the $12.5 million the existing Sears store in the Town Plaza Shopping Center is generating annually.
Many communities use tax-increment financing to accomplish the same purpose. Tax-increment financing allows the increased tax revenue from a project to go toward infrastructure in the development district instead of to the taxing entities. Cape Girardeau city manager Doug Leslie says these development deals are "more direct and straightforward."
The city has used development deals to make infrastructure improvements in the past. A similar arrangement led to improvements along Siemers Drive.
Kohl's is rapidly adding store locations. It is one of the most highly sought-after retailers in the nation.
Cape Girardeau's will be the sixth store in the Sears Grand line, a concept that offers the usual Sears merchandise along with health and beauty products, snacks and pantry items.
When the new stores open at the end of 2005 they are expected to create more than 300 jobs.
In Kohl's, Sears Grand and the soon-to-open Old Navy store at Westfield Shoppingtown West Park, Cape Girardeau is adding stores that will draw shoppers to Cape Girardeau from around the region. Ultimately, the development deal means more tax revenue for the city of Cape Girardeau.