By Gary Lloyd
A retail group asked Trussville city officials last week to consider abating a portion of sales tax to bring tenants to the former Food World on Main Street.
Representatives from Retail Specialists, Inc. asked the Trussville City Council to consider abating a portion of city sales tax that would total $800,000 over a four-year period for a grocer to locate in a portion of the building.
The city’s Downtown Redevelopment Authority continues to near a deal with a grocer, which would occupy roughly 23,000 of the 38,000 square-foot space. A fitness center could occupy the rest of the spot.
Downtown Redevelopment Authority chairman Jef Freeman said the abatements are being asked for to recoup the cost of preparing the space for use. Freeman said Food World gutted the store when it closed in 2010, leaving no shelving or refrigeration.
“Food World stripped it to the walls,” Freeman said.
According to a presentation given by Retail Specialists President Robert Jolly and Senior Leasing and Brokerage Representative Brooks Corr, the grocer and fitness center would have projected sales of roughly $15 million and generate about $450,000 city sales tax annually. The new businesses would provide jobs for 60 to 90 people.
Part of the proposed incentive overview includes 60 percent of 3 percent of the sales tax received by the city being abated until the $800,000 is reached. The city would keep the other 40 percent of the city sales tax.
Freeman said the payback for the city works out to take about four or four-and-a-half years. Freeman said a tax abatement is a common way for cities to recruit developers and retail businesses.
An agreement has not been voted on. Trussville Mayor Gene Melton said the grocery store and a fitness center locating in the former Food World would “be a boost” for downtown Trussville and surrounding businesses.
CVS, which is in the same shopping center as the former Food World, agreed earlier this year to allow a fitness club in the empty space if the building is subdivided between two businesses. CVS would already allow a grocery store in the space but not a pharmacy or drugstore.
Should a fitness club occupy half the building, the city would have to designate a certain amount of parking for CVS since there will be more demand for parking spots.
Melton said earlier this year that the city is incurring “about $22,000 plus or minus” each month to rent the building. That monthly payment is drawn because the city is paying the 15-year lease that America’s Thrift Stores had originally signed to occupy the entire space. The city originally set Trussville’s Downtown Redevelopment Authority up with a $750,000 line of credit to pay the lease.
The former Food World closed in 2010 and has been vacant since.
Contact Gary Lloyd at firstname.lastname@example.org and follow him on Twitter @GaryALloyd.