Archive for Tuesday, October 29, 2002

Business decision?

October 29, 2002

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To the editor:

I must take to task one comment in Wednesday's editorial on the Wal-Mart rezoning issue before the planning commission: "City officials have no business trying to decide what effect a Wal-Mart store might have on another business; that's the responsibility of those in the retail business."

This quote is untrue. First, the planning commission is responsible for zoning, but also the timing of development. Second, this commission should be concerned that other properties are not negatively affected by a rezoning request.

In this time of flat sales tax revenues, city officials have every reason to consider the impact 200,000 additional square feet of retail will have on our current business environment. A key question is whether this much additional retail space will generate new sales, or simply capture a market share of existing retail.

Between 1998 and 2001 sales tax revenues only increased 1.7 percent, but new retail space was increased by 11.3 percent. Obviously, the new retail space created during this time did not draw in many new dollars; it simply redistributed by new retail capturing market share from existing retailers.

The long-term impact of continuing this trend is enormous to taxpayers. If the new retail at Sixth and Wakarusa only captures existing sales, then neither new jobs nor new sales tax revenues would be generated. Further, the businesses losing sales would be put out of business, creating blight in other retail areas already suffering a higher-than-usual amount of empty spaces.

Belief that the free market will sort everything out with no risk to taxpayers is what I call faith-based economics, and has no place as the sole rule when trying to promote growth which is good for taxpayers. Prudence, to protect taxpayers, is called for.

Larry Kipp,

Lawrence

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