Menards land deal passes: 3-2 vote follows comments in favor, against
The city of Jamestown entered into a purchase and sale agreement with Menards on a 3-2 vote of the City Council during a special meeting Tuesday. Councilmen Ramone Gumke and Steve Brubakken and Mayor Katie Andersen voted in favor while Councilmen Charlie Kourajian and Dan Buchanan dissented.
Andersen said the action starts 180 days of “due diligence” to determine if Menards comes here.
The contract specifies the city will buy 33 acres for a total of $2.9 million. The purchase of the land, along with legal, engineering and development fees, will be financed with tax increment financing. Under TIF, money paid in lieu of taxes on the buildings is used to pay for the city’s land and infrastructure costs. The city will give Menards 20 acres of land for a $10 payment.
The contract specifies a number of tasks the city must accomplish, including setting up a tax increment financing district and the sales tax rebate required by the agreement. Menards is responsible for engineering and environmental work, such as wetlands delineation.
All the processes specified in the contract must be completed in six months for the contract to proceed.
Prior to the motion to approve the agreement, a motion to table the contract by Buchanan failed.
“We need to give the council and the people a chance to review and understand this,” he said in making the motion.
Andersen spoke in favor of the contract before the vote.
“My duty to the citizens of Jamestown includes capturing as much retail as possible,” she said. “It is self-funded by the dollars generated by the development itself that are not now being captured.”
The agreement passed at the end of a two-hour special meeting where the public commented on the project. Jamestown businesses concerned with Menards entering the local marketplace were represented by Richard Anderson, an attorney with Anderson, Bottrell, Sanden & Thompson of Fargo.
“It is not the competition but the city benefits (given) to Menards (that concerns the businesses),” he said, referring to the TIF district financing which would purchase the land for Menards and cover other expenses of the development.
Menards will also receive half of the city’s 1 percent sales tax generated at Menards as a rebate to cover some of its development costs in the project.
Unfair competition was cited as a concern by a number of the members of the public who addressed the council.
“Competition is good but city-financed competition is not,” said Colin Wegenast, owner of Lifestyle Appliance and Entertainment Center. “More emphasis should be placed on infrastructure and luring primary sector businesses so businesses like Menards will want to come.”
Jim Matthiesen, owner of Sears, agreed.
“I would welcome a Menards because it means more people coming to Jamestown,” he said. “But I can’t understand entering into an agreement to essentially finance the Menards.”
Scott Nuttelman, real estate representative for Menards, said the incentives were critical to the store locating in Jamestown.
“If we can find a way to partner with the city on land costs we can make it work,” he said. “Well over half the about $10 million involved will be paid by Menards. This is not a free ride. We’re willing to take that risk.”
Drew Snyder, president of Woodsonia, one of the developers involved with the project, said the Menards will attract other businesses to the three lots adjacent to the property.
“We see Menards as a catalyst to spur additional development,” he said. “We have had discussions with other retailers that have gone exceptionally well.”
Residents of Jamestown also spoke in favor of the Menards.
“I support the efforts to bring these retailers to Jamestown,” said Dave Klein, resident of the city. “I spend a lot of time driving to Fargo. This is a catalyst and the investment is worth it.”
Steve Klose agreed.
“Any weekend you go to Fargo half the people you see in Menards are from Jamestown,” he said.
Sun reporter Keith Norman can be reached at 701-952-8452 or by email at email@example.com