A proposed Wal-Mart Neighborhood Market is in jeopardy after the Starkville Board of Aldermen denied two different tax increment financing proposals Tuesday.
The developer, Wal-Mart Stores East LP, sought a $1.35 million TIF pledge to construct an access road from Highway 12 to the proposed development site in east Starkville and signalize the intersection. But four aldermen — Ward 3’s David Little, Ward 4’s Jason Walker, Ward 6’s Roy A. Perkins and Ward 7’s Henry Vaughn — blocked the original request, as well as a $675,000 compromise presented by Ward 5 Alderman Scott Maynard.
Christina Sugg, a member of the Ridgeland-based consulting firm Gouras and Associates representing the developer, told aldermen the project is not likely to materialize without TIF funding.
How, or if, the project moves forward isn’t clear. Sugg declined to comment after the meeting, saying she could not speak for the developer, but did estimate the proposed road’s price at about $900,000 to $1 million. Under the TIF agreement, the road would have been dedicated as public infrastructure to the city after the project is completed.
Oktibbeha County supervisors approved their portion of the TIF request Monday, which would divert 50 percent of county ad valorem receipts toward debt service for 15 years. The $1.35 million request aldermen denied would have pledged 100 percent of city property taxes and 50 percent of sales taxes, while Maynard’s $675,000 counteroffer committed the same amount of property taxes but only 25 percent of sales taxes.
Many of the TIF opponents, including Little and Vaughn, said they were first supportive of the project, but acknowledged receiving comments from residents opposed to the subsidy.
Little noted Kroger’s recent expansion, saying the company created one of Mississippi’s largest stores without asking for a taxpayer handout. While TIFs have been utilized to create new sales — the Parker-McGill auto dealership, for example — Little said he is worried the new grocery store would create transfer sales from existing stores, including Kroger, Vowell’s Marketplace and Starkville’s existing Wal-Mart.
Reading from a prepared statement, Perkins said the TIF proposal appeared “to continue the practice of preferential treatment given to big developments at the expense of small and existing businesses.”
“The TIF for Wal-Mart will give a property tax break and a sales tax break to one of the largest companies in the world for 15 years,” he said. “The project, in my opinion, is probably viable without this tax subsidy, and Wal-Mart would likely have built the store anyway.”
Ward 2 Alderman Lisa Wynn said the board’s action represents “a sad night” for Starkville.
After the vote, she reminded constituents of the upcoming 2017 municipal election cycle, in which all seven board seats and the mayor’s position are up for election. Perkins called for a violation of decorum, and Mayor Parker Wiseman reminded all aldermen not to make comments that could be construed as an attack on a fellow board member.
“For the people in our city that don’t think aldermen have control, you saw it tonight. They have control to bring something to our city or to not bring something to our city,” she said.
Gouras’ TIF proposal states estimated the $14 million project would create 150 construction jobs and 95 associate positions. Those permanent jobs were expected to create an estimated annual payroll of $2 million.
Once finished, the facility was forecast to create $20 million in annual retail sales, while providing the city, county and Starkville-Oktibbeha Consolidated School District with a combined $133,967.04 in additional ad valorem taxes per year.
Carl Smith covers Starkville and Oktibbeha County for The Dispatch. Follow him on Twitter @StarkDispatch
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