By Susan H. Miller/Post-Tribune correspondent
INDIANAPOLIS — The city of Hammond and Cabela’s didn’t get the yes they had hoped for from the State Board of Finance on Wednesday, but they didn’t get a no either.
At issue is whether the state will approve the use of sales tax increment financing to pay for infrastructure improvements for the development of the 93-acre Woodmar Country Club site for the sporting goods retailer.
A Cabela’s store is proposed for approximately 40 acres of the site. All 93 acres are in the proposed STIF district, which means the state would sacrifice not only tax dollars on Cabela’s sales, but also sales tax from other retailers who may build on the site.
The three-member State Board of Finance voted unanimously to table the request until Cabela’s and the Indiana Economic Development Corp. negotiate an agreement satisfactory to both the state and the retailer. The commission has a general policy that state sales tax revenue should not be sacrificed to attract retail stores to the state.
Hammond Mayor Thomas McDermott Jr. contends Cabela’s is not a typical retailer, but a tourist attraction because of the store’s features, which include a large aquarium, a 50-foot conservation mountain and a deer museum. He encouraged the Finance Board to rethink the state’s policy.
“I did a Google search on Cabela’s and learned that the state of Pennsylvania offered state tax increment financing so the Cabela’s store could be built there,” McDermott said. “In Texas, $75 (million) to $80 million in state tax increment financing was given to build two stores. Other states include Nevada, Kansas, West Virginia, the list goes on and on.
“We may not like national retailers asking for this, but if we as a state don’t get in line with what other states are doing, we could lose out,” McDermott said.
McDermott proposed the sales tax dollars sacrificed by the state for the project be used to finance the levee on the Little Calumet River, construction required before the store can be built because the property is in a flood plain. Federal dollars to build the levee have been allocated and will be made available as soon as the state matches them.
Kevin Rhodes, director of real estate for Cabela’s, said the estimated cost to build the levee is now $16 million, an estimate made recently by American Consulting Engineers.
“Frankly, we couldn’t absorb that into the project,” Rhodes said.
McDermott appealed to the Finance Board to remember that Hammond is right next door to Chicago.
“As a border city, a lot of shoppers cross the state line now and spend their dollars in Illinois, so this development and everything generated by it will keep our shoppers from leaving the state,” he said.
McDermott told the Finance Board that none of the city’s financial projections have taken into account the development that is expected to occur as a result of the Cabela’s store.
He said in his first year in office he actively sought developers for the abandoned Interstate Plaza across the street from the Woodmar property.
“Not one interested party came forward,” he said.
Since the Cabela’s project was made public, three offers have been made on the Interstate Plaza property and are pending.