On September 21, 2006, Sprawl-Busters reported that city officials in Broomfield, Colorado had offered to pay for 49% of the cost of site acquisition for a Wal-Mart supercenter — a deal that will save Wal-Mart $7.85 million, funded by taxpayers. The funding will come in the form of a sales tax to pay off the landowner, since Wal-Mart did not offer enough money to entice the existing poultry processing plant to relocate. So the city offered them welfare to cover the shortfall. A group, called Broomfield First, was quickly formed to oppose this tax giveaway, and their first order of business was to get the City Council to delay accepting a bid from Wal-Mart for the land deal. In October, 2006, the city council rejected the Wal-Mart offer on a 5-4 vote, and sent the landowner and the retailer back to the drawing board. But this week, according to the Rocky Mountain News, the Broomfield City Council approved the site development plan for a Wal-Mart Supercenter on the Barber’s Poultry property on 120th Avenue. The 7-3 vote came just before midnight on June 25th. The Council was wearing two hats: the Broomfield Urban Renewal Authority (BURA) and the City Council. The agreement calls for Wal-Mart to pay the Barber family $10.5 million, and the BURA will pay $4.85 million for relocation costs. The city also agreed to subsidize $2.5 million to the developer to pay for roadwork and infrastructure being built by Wal-Mart. The money to pay for the relocation costs and infrastructure will be generated from sales and use tax revenues from the Wal-Mart property, which includes the supercenter and four smaller pad sites. The city has justified its subsidization of Wal-Mart by saying that the project will generate an estimated $69.5 million in sales tax over the 15 years. Council members described Wal-Mart as part of their “urban renewal” of the 120th Avenue corridor. “This is about more than Wal-Mart,” one Councilman told the Rocky Mountain News. “It’s the removal of the Barber facility. It’s the redevelopment of 120th Avenue. While this may not be perfect in the eyes of many, it’s far superior to the alternative, which is do nothing and leave things as is. … It is about economic redevelopment of 120th, and we need to move forward with that.” Neighbors complained that the project will generate too much noise. All they asked for was restrictions on Wal-Mart’s delivery times.
Last year, Wal-Mart had a net profit of $11.28 billion. They are the world’s largest retailer. Their financial strength dwarfs the limited financial wherewithal of the city of Broomfield, Colorado. Yet local officials felt they had to provide “welfare for Wal-Mart” to bring this project in. Wal-Mart clearly felt it was not worth it to them to buy out the family on the land they wanted, so they turned to the city and asked them to pay for relocating the tenant. This is, perhaps, how the “free” market works in Wal-Mart’s eyes: get cities and towns to give you free money to carry off your projects. But it’s a plain business subsidy wrapped in the justification of urban renewal. It’s unfair to taxpayers in Broomfield, its unfair to competing smaller businesses who got no such tax break, and it was financially unnecessary to prop up Wal-Mart. If this giant retailer cannot fiscally stand on its own, welfare payments to them should not be offered. Wal-Mart should neither ask for, nor receive, corporate welfare. City officials in Broomfield have never leveled with residents what the ongoing costs to the city will be to provide police and fire protection to this retailer, and what impact it will have on unsubsidized merchants. Readers are encouraged to contact the Broomfield Mayor, Karen Stuart, and her City Council by cutting and pasting this following email list: [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]. Tell them: “Wal-Mart does not need $7.35 Million in tax giveaways. You have hurt local business in your city by giving Wal-Mart a special subsidy deal. Let them financially stand on their own, they don’t need Broomfield taxpayers to support them.” For similar stories about public handouts to private big box stores, search Newflash by “corporate welfare.”
