Denver City Council gives initial approval for $5 million Target project
DENVER — A new Target store is one step away from opening its second store in Denver next year. But it comes at a cost of $5 million from taxpayers.
Denver City Council gave first reading approval of the deal to use public dollars to help a private company Monday night. It has not received final approval yet. A public hearing and final vote is scheduled to happen Monday, March 26.
Like a stagnant relationship, Target gave Denver an ultimatum–commit or it’s walking away.
That commitment is millions in sales tax revenue.
“It’s not as if they don’t have the money,” says Metro State Marketing Professor Darrin Duber-Smith.
“I think if you don’t ask, you don’t get it. They use it as leverage. We’ll build our store somewhere else if you don’t give us the tax break here.”
Target will pour $20 million into redeveloping the now-blighted Tamarac Square and get $5 million back from sales tax it collects over 10 years.
For $5 million the city gets 30 to 50 full-time and 100 part-time jobs plus 250 construction jobs.
But at least one council member said it’s an incentive we should only offer to companies bringing good, middle-income jobs providing health care.
“It’s important when we have such small public money, to use it for good jobs–not so much to focus using public dollars for retail,” says Robin Kniech.
It’s been a common practice, but that’s changing.
“The trend is away from cities paying for this sort of thing. Cities are broke. Cities all over the country are being taken over by counties and state government because they are bankrupt,” says Duber-Smith.
Residents are mixed about giving millions to a successful company that made nearly $3 billion in net earnings last year–money that could have been spent elsewhere in the city.
“I’m in favor of it. I’m in favor. Target is a good company. They give back to the community. It’s better than nothing being there right now,” says one Denver resident who didn’t want to give her name.
“I’m more in favor of redeveloping the area and bringing jobs to the area,” says Chris Swanson of Arvada.
“We should keep the money in the city and not give it to a big retailer,” says Denver resident Bethanne Whalen.
There will be a public hearing on this issue next Tuesday. If all goes Target’s way, the 135,000 square foot store will open July 2013.