City manager distorting costs of Walmart/Annex
Atascadero business people and taxpayers, beware!
If you believe the city manager’s claim that the city will get about $4.9 million from the Walmart/Annex project for the Del Rio/Highway 101 interchange roundabouts, you’re in for a very rude and expensive awakening.
In fact, the city will receive about $1.3 million from Wal-Mart Stores Inc. for those roundabouts, leaving the rest of us on the hook for about $3.2 million of the estimated $4.5 million cost.
To fabricate his false assertion, Mr. McKinney includes about $2.3 million in fees from the nonexistent Annex project, and about $1.7 million in fees Wal-Mart will contribute for other (non-Del Rio/101) road improvements in the city.
He made this phony case twice: to the City Council on April 10 and in his April 13 “News from The City” column, so it’s not just a mistake.
Mr. McKinney claims “the projects will contribute approximately $4,887,000 to the city’s TIF (traffic impact fees) account. The city would use this money to fund the interchange improvements.”
Here’s how he concocted that number:
Regarding special TIFs (Traffic Impact Fees designated for the Del Rio/101 roundabouts), he states, “The special TIF would cover the project’s proportional shares of the interchange costs, roughly $2,388,000.” That includes the nonexistent Annex’s TIF of $1,095,301 and Wal-Mart’s TIF of $1,292,798 (total $2,388,099).
Regarding standard TIFs (for city-wide roads), he states, “the projects will pay a standard TIF of $2,865,000.” That includes the nonexistent Annex’s TIF of $1,166,536 and Wal-Mart’s TIF of $1,699,220 (total $2,865,756).
Mr. McKinney is falsely inflating project proponent TIF contributions for the Del Rio/101 roundabouts by a total of $3,961,057, including $2,261,837 from the Annex that’s gone belly-up, and $1,699,220 from Wal-Mart not designated for the Del Rio/101 roundabouts.
Mr. McKinney’s fabrications were about the “Wal-Mart only” PRDEIR (Partially Re-circulated Draft EIR), from which all the above figures are derived (see 3.11 Transportation, page 3.11-29 on the city’s website).
So, the business community and taxpayers in town are left with a $3,207,202 million burden as an unfunded liability for the estimated $4.5 million cost of the Del Rio/101 interchange. And, we won’t know what the actual costs will be until Caltrans either approves the roundabouts or requires more expensive rebuilding of the overpass.
It is highly irresponsible for the city manager to disseminate such disinformation and for the City Council to allow him to do so.
David Broadwater has lived in Atascadero since 1972 and has been following city government for several years.
Let’s clarify the project’s costs to city, taxpayers
By Wade McKinney
The Walmart/Annex project consists of 260,460 square feet of retail uses and 50 residential dwelling units. There are two commercial components of the project: a 129,500-squarefoot Walmart store with two freestanding pad buildings and The Annex with 120,900 square feet of commercial uses.
Public hearings on the Del Rio Commercial Area Specific Plan (Walmart/ Annex) will begin in June. The Planning Commission and City Council will both hold public hearings on the Environmental Impact Report and the proposed Specific Plan. In order to facilitate a productive public dialogue, it is important the public understands the fundamentals of the traffic mitigation proposal.
The EIR has identified a significant impact to the Del Rio Road/Highway 101 interchange as a result of the project. Roundabouts are proposed as a cost-efficient traffic mitigation solution. The cost of building the roundabouts is $3 million to $4.5 million. The city is using the higher $4.5 million estimate to calculate project fees.
Under state law, projects are only financially responsible for their “proportional share” of an off-site facility such as a freeway interchange. Together, the Walmart and Annex projects would be responsible for 53 percent of the traffic impact at the interchange, or $2.4 million. The remainder of the cost, $2.1 million, is the responsibility of the city and could be paid for out of existing and future Traffic Impact Fees paid by developers (not taxpayer money).
The developers will pay their share of impact through regular and special Transportation Impact Fees.
In addition, Wal-Mart will install $1.9 million in street improvements along El Camino Real and Del Rio Road. The issue of traffic fees and proportional share is rather complex and can be confusing. Here is asummary of the proposed traffic fees for the project:
Special Interchange Fee, $1,159,923.
Standard Traffic Impact Fee, $1,443,414.
Credits for road improvement to be completed by developer ($333,912)
Walmart total: $2,269,425.
Special Interchange Fee, $1,228,176
Standard Traffic Impact Fee, $1,422,342
Credits for road improvements to be completed by developer ($32,529)
Annex total: $2,617,969.
Total developer traffic fees: $4,887,394
Note that together, the special interchange fees paid by Wal-Mart and the Annex equal $2,388,099, or 53 percent of the high estimate for the construction of the interchange roundabouts.
What happens if the Rottman Group fails to develop the Annex? The fact remains that the site’s proximity to Highway 101 and a new Walmart store makes it extremely attractive for future development.
If Walmart is approved, we believe development at the Annex will occur. While there may be a period of time that the city’s Transportation Impact Fund (fees paid by developers, not tax dollars) fronts part of the interchange prior to development of the Annex site, the risk may well be worth it. Not only will members of the community get the much-needed shopping and restaurants they have long desired, there will be significant jobs and tax revenue as a result. The fiscal consultant for the EIR estimates the combined Annex/Walmart project will generate net income of $530,000 annually for the city.
Wade McKinney is the city manager of Atascadero.