Staff graphic by Danedri Thompson

Staff graphic by Danedri Thompson

Walmart has been reimbursed for about 64 percent of eligible project costs since the big box retailer was built in 2007 near 175th Street and Interstate 35.
This is ahead of the maximum 20-year payback period originally associated with the project; however, Laura Gourley, Gardner finance director, said this quarter’s payment was not at an accelerated rate.
About $251,200 was paid from the city of Gardner to Walmart on June 25 and represents the second quarterly payment. The compensation recaptured both the property tax increment as well as sales tax, Gourley said.
When someone makes a purchase at the Gardner Walmart, the store remits sales taxes on the item to the state. The state returns a portion of that sales tax to the city of Gardner, and the city returns that sales tax to Walmart, due to the tax increment financing (TIF) used to build the Walmart development in Gardner.
The city’s revised 2013 total budget for sales tax was $3.48 million, including city and county sales and use tax. None of the Walmart TIF was included in that budgeted amount, Gourley said.
It is still anticipated the Walmart TIF will be repaid in 2016-17, and the council in office then will determine how to use the additional funds, which could be about $1 million annually for the TIF.
According to last year’s 2013 budget, there has been no contract curb replacement or pavement resurfacing on residential streets since 2007 due to funding limitations. In addition, the public works budget notes “lack of funding for the maintenance of public infrastructure (streets, storm water, water and wastewater (utilities)” as a continued issue. Public works 2013 budget is about $1.7 million.
When the Walmart TIF was approved in 2007, there were no requirements regarding number of jobs, annual payroll or percentage of jobs within the area.
Currently the city does not have a specific TIF policy.
The Walmart TIF project included:
-removal of Conestoga’s sewer treatment ponds
-intersection improvements including 56 Hwy, Cedar Niles, and 175thStreet
Sales tax from Burger King, or any other businesses to be built on the Walmart pad site, are also included in the sales tax recaptured under the Walmart TIF.
A TIF project is generally defined as a public financing method that is used for subsidizing redevelopment, infrastructure, and other community-improvement projects on areas considered “blighted.” The Walmart location was considered blighted because of old sewage lagoons located there.
When an increase in site value and private investment create an increase in tax revenues,that is a tax increment. A TIF dedicates tax increments within a certain area to finance the debt to pay for the project. A TIF can be used to channel money in distressed, underdeveloped, or underutilized areas where development might not occur otherwise.