City officials in Spooner, Wisconsin were spoon-feeding Wal-Mart — but it just wasn’t enough. This week, the giant retailer abruptly withdrew its dream of a supercenter in this small Midwest community. On October 8, 2008, Sprawl-Busters reported that Washburn county officials were scrambling desperately to find some way to lower the cost of the project. They were willing to lower their tax assessment on the superstore when word came that Wal-Mart had lowered the boom on the entire project. The world’s largest retailer, with net earnings last year of more than $12.7 billion, told town and county officials that it couldn’t afford their Spooner project without a public subsidy. Just as Wal-Mart has demonstrated its ability to muscle its vendors down the price chain, so the retailer seemed to be succeeding with elected officials who wanted to sell them some land. On September 8, 2009, Sprawl-Busters reported that Wal-Mart wanted a financial break from Spooner and from the Washburn, Wisconsin County Board, which owns the land. Wal-Mart asked the county to prevent other public parcels surrounding the proposed superstore from being sold to Wal-Mart competitors for 40 years. Three months ago, county officials told the Washburn County Register that stories about Wal-Mart asking the county and city for $1 million for the project just weren’t true. Wal-Mart had waged an on-and-off campaign to build a 153,000 s.f. superstore in Spooner on 35 acres of county land. This project has been in the works for three years. Last January it was reported by the Register that the Wal-Mart supercenter project in Spooner was in limbo. A Wal-Mart spokesman said the Spooner Supercenter was in a “holding pattern” while the company tried to “manage our growth to insure the long-term success.” After roughly four months in limbo, Wal-Mart announced last April that under new “business parameters,” the supercenter project would proceed — on a smaller scale than originally proposed. By July, Wal-Mart paid $30,000 to ask for more time to get its proposal in order. This was the 8th such extension Wal-Mart had asked for. Wal-Mart’s lawyer told the county another extension was needed to get the developer’s plan and railroad modifications at the site, the latter of which must be done by the state. The developer’s agreement was slated to come before the Spooner City Council in September. One member of the County Board complained that Wal-Mart, in effect, had held their land “hostage, in a way” for more than two years. During this time, Washburn County taxpayers haven’t received any money from Wal-Mart, or any taxes. Their extension fees have all gone into an escrow account. If Wal-Mart ended its agreement with the county for the land, all the money in escrow would be distributed to the county. The land agreement that Wal-Mart presented to the County asked that the land surrounding the superstore not be sold to competitors. Wal-Mart has a list of stores it considers to be competitors. Wal-Mart wants a 40 year no-compete restriction on the surrounding lands. Washburn County has never been asked to restrict who can buy its land in this manner. Wal-Mart implied to the county that if this non-compete clause were deleted from the agreement, the retailer might pull out of the deal. At the city level, the Spooner City Council has apparently agreed to a memo of understanding on the project that requires Wal-Mart to pay offsite road improvements. In September, Wal-Mart threw another expensive monkey wrench into the deal. Local residents told Sprawl-Busters that Wal-Mart had told the County it wanted a $1 million welfare payment in order to move forward with the project. “Unbelievable that Wal-Mart finally did what we had been telling the county for almost 3 years,” citizens wrote. “We told them they were not partners with Wal-Mart. This could be the way Wal-Mart walks away. The county has no funds and the city is looking into any state or Federal programs.” According to the minutes of the September 8th, Washburn County Board, under the topic “Wal-Mart Update” the minutes state: “Committee discussed the meeting that was held as a result of a Wal-Mart request… with discussion centering around Wal-Mart’ s request for a $1 million drop in infra structure charges and for the County or the City to input $1 million into the project or they will not be able to go ahead with the project.” The Board then voted that the matter should be placed on the Agenda for informational purposes, “as Washburn County does not have monies to fund this request.” This week, Washburn County officials did their best to whitewash last month’s stories — and their own board minutes. The County’s Executive Committee — not the full board — voted to reappraise the land Wal-Mart wants to buy. County Board Chair Micheal Bobin said that rumors of Wal-Mart asking the county and city for $1 million for assistance are just not true.”They did not ask [the city or county] to kick in any money,” Bobin said. But Bobin’s version of what Wal-Mart asked for amounts to the same thing. Bobin said Wal-Mart asked officials to lower the improvement costs by $1 million. The county decided one way to lower costs to Wal-Mart was to reappraise their 35 acres, to see if they could sell it to Wal-Mart cheaper — the same way a Chinese manufacturer would lower their price to get the contract. The land’s original value was $900,000 three years ago, when Wal-Mart approached officials with the deal. When Wal-Mart shows interest in a parcel, the appraised value generally goes up, as well as any commercial land around it. But the county is looking for money to give back to Wal-Mart, and the reappraisal concept is more politically palatable than coming up with money the county does not have. But the end result is the same: taxpayers will lose money if Wal-Mart gets a discount on the land. The county hired an appraiser for $2,000 using a special projects fund — which amounts to a ‘special deal’ fund for developers. The county’s lawyer said that use of this special fund does not require action from the full county board. But the welfare deal doesn’t end there. The city and county are also looking at giving Wal-Mart tax increment financing (TIF), a deal that allows taxes paid by Wal-Mart to go towards the project’s infrastructure needs, instead of into the city or county treasury for the taxpayers’ benefit. The TIF is basically a tax break that helps write down the cost of site-related work. Officials said Wal-Mart was “more than willing” to pay for all necessary infrastructure costs directly related to the store — but apparently not the roadwork needed to get cars to the store. Spooner’s Mayor Gary Cuskey backs whatever welfare payments are needed to make the deal materialize. The Mayor said newspaper reports of the negotiation with Wal-Mart were full of “misleading and sensationalized newspaper headlines” about the million dollar request. But the citizen’s group that has been fighting this proposal since Day One was not confused by the change in terminology. Washburn County First Chair Steve Carlson told The Register that citizens fear that taxpayers will be footing the bill for special breaks given to Wal-Mart. “I’m sure that almost every property owner in Washburn County, except those hoping to sell, would like to see a downward reappraisal of their land and home,” Carlson said. “We could all use some property tax relief right now. The American taxpayer just bailed out Wall Street to the tune of $700 billion-plus. Now the Washburn County taxpayer has to bail out Wal-Mart’s Spooner project? I hope people will let their elected officials know what they think of all this.” But this week, Wal-Mart bowed out. Just a couple of weeks ago, the county’s Executive Committee said they had reappraised Wal-Mart’s land, and were willing to lower its tax assessment by $80,000. On December 17th, County Board Chair Micheal Bobin announced that Wal-Mart was not coming to Spooner. Wal-Mart issued a corporate press release which said the company’s current “moderate growth” plans for new supercenters led the company to shutdown the Spooner project. “It has nothing to do with Spooner’s retail market appeal, nor with the level of cooperation in the city,” a Wal-Mart spokesman said. “While the decision is appropriate from a business standpoint, we remain impressed with Spooner’s business potential and grateful to local officials and staff for their diligent work on behalf of the community. They have been very professional, and we have enjoyed working with them.” But local officials may not be thinking about how much Wal-Mart is ‘impressed’ with the city and county. The fact remains that as of this week, Wal-Mart has not given any money to the county or city for the land, which was set at $900,000.
During the past three years, the citizen’s group Washburn County First went to court twice: once charging that the county had violated open-meeting laws when it sold the land to Wal-Mart, and a second case against the city’s Board of Appeals, saying they didn’t conduct a thorough review of the application. One lawsuit was withdrawn, the other settled out of court. The county admitted to one count of violating the open meeting law, and paid a fine. After years of controversy and delays, Wal-Mart suddenly informed the county that it needed a big infusion of tax dollars to salvage this project. The retailer may have felt that the county was desperate enough to sell their land, that Wal-Mart could gain some concessions from them in addition to their “no complete” land agreement. It has been estimated that the road upgrades that Wal-Mart would have been asked to pay for, could have reached $4.8 million. Washburn County First (WCF) formed to get information out to the public about the negative impact this development would have on small town retailers and the county at large. The city offered Wal-Mart welfare money to locate in town, and put them in a TIF (tax increment financing) district to offset taxes. Readers are urged to email Micheal Bobin, the Chairman of the Washburn County Board of Supervisors at [email protected] with this message: “Dear Chairman Bobin, After three years, how exciting that Wal-Mart has dropped the ball in Spooner! Wal-Mart has tied up your 35 acres of land for over three years now — as many as 8 extensions — with no financial benefit to county taxpayers to show for it — not even a real estate tax payment. In addition, they asked you for an unprecedented ‘no compete’ restriction on taxpayer-owned land. Most recently they asked for a $1 million drop in infrastructure costs. You were seriously considering lowering the value of the land, rather than making this rich corporation pony up the money. This is a totally inappropriate request on Wal-Mart’s part, given they cleared almost $13 billion in profits for the past year. If a company with that much money cannot stand on its own — then let the project fall from its own weight. Wal-Mart may have been testing the county and the city to see how much they could get out of you — just like they do with their vendors. Wal-Mart did nothing with this project for months — even suggesting that the project might never come to fruition. Now they pull the plug themselves. Supervisor Mackie was right: ‘this land has been held hostage, and its time to set it free.’ It’s time for the county to actually get its tax escrow payments from Wal-Mart — and hope that the company is finally done messing around in Spooner. Wal-Mart’s own internal problems have saved you from yourselves.”