Crestwood aldermen OK extra sales tax to attract Ace Hardware

By BURKE WASSON

After killing and then reviving a proposed community-improvement district at Crestwood Square three weeks ago, Crestwood aldermen voted unanimously last week to approve the tax district that will bring Ace Hardware to the city.

Aldermen voted 7-0 Dec. 12 to approve the formation of a community improvement district, or CID, with a one-cent sales tax that will reimburse developer G.J. Grewe Inc. for up to $2 million in project-related costs.

The one-cent sales tax will have a maximum life of 20 years at the Crestwood Square shopping center.

Ward 4 Alderman Steve Nieder, who previously questioned the necessity of the CID, did not have a say in its passage as he was absent.

Aldermen also approved an ordinance establishing the city’s development contract with Grewe by a 6-1 vote. Board President Jerry Miguel of Ward 3 was opposed.

An ordinance designating Crestwood Square as a blighted area also was approved by a 7-0 vote on Dec. 12.

Developer Gary Grewe said West Lake Ace Hardware will move into a 30,000-square-foot store at Crestwood Square and that four other retail spaces will then be divided from the currently vacant building that once housed Office Depot and the Sports Authority. Grewe said Ace Hardware representatives likely will begin the renovation in early 2007.

While aldermen and Grewe had previously debated the structure of the CID and the development contract at two meetings in November, the board passed all three ordinances related to the project on Dec. 12 with no discussion.

Some aldermen previously questioned Grewe’s desires for the project, which included having a majority vote on the CID board.

The CID ordinance passed last week retained majority control on that board with the city. Three of the CID board’s five members will be selected by the city and two members will be picked by Grewe, according to a draft of the now-approved CID ordinance.

Grewe also has refused to say how much money he will be spending on the renovation, which previously caused Miguel and Nieder to question the project.

For nearly two hours at the Board of Aldermen’s previous meeting on Nov. 28, plans for the CID were dead. But aldermen then revived the redevelopment project by reconsidering a denial of that CID and eventually passing a first reading toward approving the one-cent sales tax.

After he realized that the board’s “no” vote on the CID killed the Ace Hardware project, Ward 3 Alderman Gregg Roby called for a motion to reconsider that denial. The motion was then seconded by Ward 4 Alderman Pat Duwe. That vote for a reconsideration was passed 6-2, with Miguel and Nieder opposed to having another vote.

The second proposal for the first reading of the CID then passed with five of eight aldermen voting in favor.

Miguel and Nieder again voted against the CID, and Ward 1 Alderman Richard Bland abstained.

Bland originally had cast the deciding fifth vote that denied the CID, essentially killing the Crestwood Square project.

On the board’s first vote for a first reading of the one-cent sales tax on Nov. 28, the measure was opposed 5-3. Bland, Miguel, Nieder, Roby and Ward 2 Alderman Chris Pickel voted no on the CID the first time.

Duwe, Ward 1 Alderman Richard Breeding and Ward 2 Alderman Jim Kelleher voted to support the Crestwood Square CID each time the board voted on both Nov. 28 and Dec. 12.

The board also voted 4-3 on Nov. 28 to approve the first reading of a development contract for the project between the city and Grewe. Miguel, Nieder and Pickel were opposed while Roby abstained. The board also voted 5-2 on the first reading of an ordinance to designate Crestwood Square as a blighted area. Miguel and Nieder were opposed, and Roby again abstained.

Under the city’s development agreement with Grewe, the bulk of the $2 million CID will refund Grewe for an estimated $1.7 million in building improvements. These include, but are not limited to, roof repair and replacement, HVAC unit repair and replacement, mechanical work, electrical work, plumbing, subdivision of tenant spaces, redesign of store entrances, facade renovations and tenant improvements.

The one-cent sales tax from the CID also will reimburse Grewe for an estimated $200,000 of site improvements, which include the repair and replacement of asphalt, site lighting, signage, curbing and striping. Tax funds from the CID also will help cover Grewe’s costs for an estimated $100,000 of “soft costs” like legal work, civil engineering and architectural and professional services.

The contract also includes a section prohibiting specific businesses at Crestwood Square, to which Grewe had previously objected.

The tenant-selection provision prohibits specific low-revenue producing businesses at Crestwood Square, according to the draft of the development contract with Grewe and the city.

The types of business not permitted at the shopping center include, but are not limited to, taverns or bars, nightclubs, bowling alleys, billiard halls, arcades, movie theaters, live-performance theaters, service stations, automotive repair shops, pawn shops, automobile dealerships, day-care facilities, hotels, storage facilities and veterinarian offices. The provision further stipulates that the following business projects are permitted but would not be CID-eligible — health clubs, gyms, training and education facilities, buy-out or liquidation businesses and “retail stores featuring general merchandise closeouts or factory closeouts similar to Big Lots and Value City.”

While Grewe had objected to the inclusion of this clause, City Attorney Robert Golterman has indicated that aldermen still could approve any of those businesses at Crestwood Square by simply voting on an amendment to allow for a specific project.