Photo by George Lauby
Two million dollars will be awarded to help build a new Hobby Lobby in North Platte, following action Tuesday night by the city council.
If all goes well, Hobby Lobby will open in time for Christmas shoppers in 2015 on the south side of Interstate-80, near the Holiday Inn and Suites.
Hobby Lobby offers craft and hobby supplies such as fabrics, yarns, scrapbooking and artist’s materials, baking and party supplies, home décor, wedding and floral supplies. The company has 558 stores across the country and is building about 70 more a year.
Women love the store and men tend to shop in other places to towns with a Hobby Lobby, boosting the town's economy, supporters said.
The council approved $1.2 million in tax increment financing (TIF). Then after prolonged debate, the council approved a controversial grant of $880,000, too.
Developer Mark Wilkinson and council advisors said Hobby Lobby could not come to town without both incentives.
Supporters say the store will draw shoppers from a wide area and stop the "leakage" who leave North Platte to shop. Developer Mark Wilkinson has bigger ideas. He foresees new retail box stores and restaurants in coming years south of I-80.
The store will be located at Willow and Eugene, next to the Holiday Inn and Suites.
Councilman Glenn Petersen said he recently accompanied his wife to Kearney. While she shopped at Hobby Lobby, he waited in the car to see where cars were coming from. He said he saw license plates from seven other counties.
Also, advisors note that a new Wal-Mart store is under development in Ogallala. Internet shopping continues to grow in popularity. A new state law will eliminate sales taxes on agricultural machinery parts in October, all of which will reduce city sales tax income.
A new Hobby Lobby could generate as much as $160,000 in city sales tax a year, said Mike Jacobson, who chairs the community redevelopment authority that recommended the TIF package.
Jacobson, the president of Nebraskaland National Bank, said his bank would not finance any part of the project because it would be blatant conflict of interest.
But at the urging of Councilman Andrew Lee, the council placed two conditions on the $880,000 grant. Half of the money will be paid only when Hobby Lobby signs the lease and half when Hobby Lobby begins to build the new store.
Hobby Lobby signed a letter of intent in April to come to North Platte if the site is ready by March 2015. A lease has been drafted that would last 15 years, Wilkinson said.
Wilkinson said demolition of existing buildings would begin promptly. Utiliites will be rerouted, drainage improved, a parking lot will be paved and a slab foundation set for the new building. Then the site will be turned over to a crew hired by Hobby Lobby that will build the building.
Wilkinson will continue to own the property and his company will rent the store to Hobby Lobby. Hobby Lobby will use about half the building, commanding a rental rate of about $6 a square foot, far less than the market rates. Wilkinson will look for a tenant for the other half of the building, possibly Dunham’s Sporting Goods, he said.
The grant comes from the city's Quality Growth Fund -- a fund of about $4 million. The money is set aside to entice developers and businesses to North Platte. The grant will dip heavily into the fund, and comes not long after $100,000 of the fund was granted to Gary Suhr and Lonnie Parsons, who are renovating and reopening North Platte's bowling center and restaurant.
The votes were overwhelmingly in favor of approving the incentives, but not unanimous. Councilman Brook Baker voted against the TIF, and Councilman Jim Carman voted against the grant.
Baker asked Jacobson how prime development land near the I-80 interchange could be considered blighted and substandard -- a requirement to qualify for TIF.
Jacobson said the building is more than 40 years old and shows a degree of dilapidation. He said the area was declared blighted in 1998 when the Wal-Mart Distribution Center on East State Farm Road qualified for TIF.
Wilkinson said the terms blighted and substandard do not really convey the purpose of TIF incentives. He said development is a better term.
Baker also said Wilkinson had a responsibility to keep the parking lot and the old K-Mart building (which will be demolished) in better condition.
Wilkinson Development bought the 1970s era building after K-Mart left, when it was occupied by the Immigration and Customs Enforcement, Wilkinson said. ICE later moved to the federal building -- the downtown post office. The Lincoln County Visitor's Bureau and Red Roof Antiques now occupy the old building, but the Visitor's Bureau intends to quit using the building. Red Roof lacks economic vitality, supporters said.
In other business, the council:
• Approved a keno agreement with Cody Keno and K & L Enterprises to operate at the renovated bowling center -- which will be Wild Bill's Wings and Bowling. The new center is expected to open in early August.
• Authorized $25,000 to Cement Products for street improvements in the area around Sixth and Hayes.
• Approved the claims (monthly bills), but not before Councilman Tim Barrett asked for more information about a half-dozen of them, including $8,078 to the League of Municipalities from the electric fund. Finance manager Dawn Miller said it was electrical safety training.
"I don't know what some of these are so I'm going to ask," Barrett said. He also asked about a $4,000 to Commercial Industries. Miller said it was for light bulbs.