Lacombe Market Square will soon be home to a large Canadian retailer after Lacombe City Council decided to invest $750,000 to facilitate its development
The City of Lacombe gave second and final reading to Bylaw 462, which will allow the City to invest the money.
Councillors Cora Hoekstra and Thalia Hibbs voted against the bylaw in a 5-2 decision.
“What they have agreed to do is purchase land for a price and sell it for a price that is less — $750,000 — with the commitment that the developer will construct a store of a major retail size,” Matthew Goudy, City of Lacombe chief administration officer, said.
“Failing to complete construction within four years would result in the City recovering the $750,000.”
The investment would mean that City of Lacombe taxpayers would see a roughly $13 to 14 monthly increase in their tax rate for the average home.
Most of City Council ran with the intention to keep tax increases at the Consumer Price Index (CPI = inflation rate), but Mayor Grant Creasey said the development of Lacombe Market Square will open new avenues of commercial development — easing the tax burden on residents in the long run.
The development will also keep retail shoppers in the City, according to the mayor.
“That was the number one topic of concern that myself and the other councillors heard throughout the election process,” he said. “What the people of Lacombe wanted was increased retail opportunities and the feedback that we have received, people are willing to spend some tax money in that regard.”
The “big Canadian retailer”, which will not be announced until an agreement is signed, will not be the be-all, end-all for shopping — but Creasey believes it will spur further development in the Square.
“To expect any one store to meet all the needs of all the people here is somewhat wishful thinking,” he said. “It is a little ridiculous, but it is our hope that this will lead to significant development of adjoining stores.”
Goudy added the investment is a way to kickstart future development and that municipalities finding ways to encourage economic development is not new.
Municipalities have often given tax forgiveness or have provided services for business.
“We discussed what was the most transparent and above board way that economic development that could occur — this is the mechanism that came out on top,” he said.
The investment will not take place until an agreement with the developer is secured.
Once that happens, the developer has to apply for a development agreement within 30 months, begin construction within 36 months and complete construction within 48 months.
Goudy added that if the large retailer were to fail after completion, something that is hypothetical and that he didn’t expect to happen, the City would not recoup their $750,000.
Creasey said he has received feedback from the business community and expects this to be a positive for all business in Lacombe.
“I really don’t see it as a negative thing for future growth,” he said. “Not only will it encourage people, who quite frankly, visit other municipalities to do their shopping but (it will) also encourage people living outside the City limits to come here as well.
“Overall a net gain”
Hoekstra, who voted against the borrowing bylaw along with Councillor Hibbs, said she supports Council’s decision but is disappointed and is worried about the precedent this bylaw sets for other businesses.
“If something like this came up again, I feel municipal government should not enter into this kind of decision,” she said. “At this point, I hope it works well for the benefit of the residents of Lacombe.”
Hoekstra said the decision could influence choices Council is faced with in the future and that it is not the spirit of the Municipal Government Act.
“We are here to have good governance, provide services and have a safe community. I guess I didn’t initially read this as providing services or good governance,” she said.
The decision, however has been made and Hoekstra said she will continue to support Council’s decision going forward.