Montgomery Approves Tax Incentive for Sam's Club Development
Village will pay for site improvement costs if construction begins by Nov. 15.
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The Montgomery Village Board approved a tax incentive agreement Monday night to bring a Sam’s Club store to the Ogden Hill Development.
The agreement, which will have the village reimbursing Sam's for site improvements, will cost the village about $4.5 million in anticipated tax revenue. The amount cannot exceed $7.5 million, according to the agreement.
Trustees approved the plan in a 5-1 vote. Trustee Andy Kaczmarek was the lone no vote.
If improvements begin by Nov. 15, the village will pay 75 percent of sales tax revenues received from the store back to Sam’s Club through August 2028, or until the final improvement costs are repaid.
The estimated cost to improve the site is $4.5 million. The $7.5 million “has been calculated as the value that is needed to be paid in the future to cover these costs today,” according to a board memo from Jeff Zoephel, acting village administrator.
Zoephel has said the village stands to gain about $750,000 annually in sales tax revenue from the store, of which $562,000 would be repaid to Sam’s each year of the agreement.
The store, which will include a gas station, is expected to bring about 170 new jobs to the area.
Editor's note: The original version of this story has been edited for clarity.
Tom Hughes
3:49 pm on Tuesday, March 12, 2013
Congrats to the Village of Montgomery for their forward thinking. I just can't help but wonder about the Village of Oswego sitting on that empty Lowes building right next to Wal-Mart, which already has a retail gas station associated with it. Way to go Oswego......way to make it happen. What's the matter? You didn't want to pony up with future sales tax revenue? You can spend almost as much money on capial equipment as you do for your road resufacing when you know you have developments that have roads that have passed their useful life. Oh well.
Munk79
7:03 am on Wednesday, March 13, 2013
So where exactly will this be? Near the empty fields by the library? Directly in the parking lot area adjacent to JCPenney? That seems like too small of an area for a Sam's and gas station?
Steven Jack
10:52 am on Wednesday, March 13, 2013
@Munk79. Yes. On the west side of the Ogden Hill development.
Linda Pasetti-Olson
10:53 am on Wednesday, March 13, 2013
@Tom Hughes - I believe Sam's Club / Walmart has already said that they looked at the Lowes building on Rte 34 and it wasn't suitable for their needs ... Too small, no room to expand, traffic flow issues, etc. A company like that has such diverse criteria that what looks obvious to the public is not necessary what they will consider.
Greg Nelson
12:01 pm on Wednesday, March 13, 2013
I asked a question related to failure or early exit by SAM'S Club and understood from Jeff Z that if they leave early they must make up the shortfall. I can't see that in the agreement but that is the Villages Attorney's understanding, sure hope he is right!
mike ellison
2:28 pm on Thursday, March 14, 2013
This is hilarious. You do realize that this 'idea' of paying for private improvements is exactly what the Village of Montgomery did with all of their special service areas in various housing developments. We all can see how well that worked out. Geniuses, just geniuses.
Amy Miller Jackson
8:31 am on Tuesday, March 19, 2013
The estimated cost to improve the site is $4.5 million. The $7.5 million “has been calculated as the value that is needed to be paid in the future to cover these costs today,” So the Village paid Sams $7.5 to move in basically. Keep the sales tax Montgomery as long as we get the $ for 308 which is the bulk of all our property taxes. Don't forget they are in the OFPD as well. What other taxing bodies will benefit? Library Dist as well? Not sure where the lines cross