Council is considering other Options for the Trinity Site

Tonight there was a special Council meeting concerning the Trinity site project. Mr. Wade Williams from Boyer was present at the meeting. He made a short presentation and then answered questions from the Council. He started his comments by saying that there is no 30 day deadline and he doesn't understand how the Monitor came to that conclusion. He acknowledged that both Smiths and Walmart are interested in the Trinity site and discussions with these potential anchors are ongoing. According to Wade, Boyer believes that they have arrived at a financial model that would make the project work. This model would involve two things. First there would be a phased development of the site starting with the big box anchor store. Once the anchor store is open for business Boyer would gradually build the buildings for the other smaller retailers as market conditions allow. Second there would be some kind of County contribution to the project, possibly for road and utility work associated with the site. I got the impression that Boyer is very much interested in moving forward with the project despite the difficult economic conditions and that two potential anchors are also interested.

Following Wade's comments County staff presented three options for Council to consider for how we might proceed with the project. Several members of the public spoke and the Councilors took turns with their comments. Councilor Wismer indicated that it is time for us to consider other options for the site and offered the possibility of placing a new graduate college on the site. Councilor Wheeler expressed his disapproval of the current Boyer proposal which he likened to another Mari Mac type shopping center. There was a general sense by the other Councilors that the community was promised a lifestyle center with many different kinds of businesses including entertainment and Boyer's current proposal only gives us the big box store.

When it was my turn to speak I had much to say about the three options presented by the staff and I prepared some written comments which I read at the meeting. I have included my comments below.

I have heard three options for how to proceed with this project. In my view all of these options will lead to the eventual termination of negotiations with Boyer and with that we will lose any chance of getting a new big box store in the near future. This is an unacceptable outcome for our community.

Option 1 involves talking with other developers and exploring other potential deals in the marketplace. We can’t negotiate in good faith with Boyer while at the same time talking with other developers. In order to reach a deal both the County and Boyer must be committed to each other. Option 1 would undermine that commitment, and throw away the principles and trust established over the course of more than two years of negotiations between the County and Boyer. To proceed with this option would not help make a deal, rather it would kill the deal.

Option 2 would have us set a firm deadline for Boyer to sign the deal and then would have negotiations terminated if a deal isn’t reached. I don’t agree with this option because it is too adversarial and puts unnecessary time constraints on both Boyer and the County. The sense of urgency in completing a deal with Boyer is artificial. Construction on the Trinity site can not begin until June 2010 at the earliest for several reasons. Buildings on the site are presently occupied by staff and the relocation process hasn’t begun. In addition an RFP for demolishing the buildings hasn’t been issued. The master ground lease between the County and Schools is not complete and when it is finished approval from the State Board of Finance will still be required. Surely with so much left to be done in addition to finalizing the deal with Boyer, we can continue for a least a few more months to negotiate with Boyer without a premature deadline.

Option 3 is termination of the negotiations with Boyer. This option would force the County to either develop the property itself or find another developer, both scenarios have considerable risks relative to our current position.

We have already committed 75 million dollars of public money for new facilities at the Airport Basin and demolishing the existing buildings at the Trinity site. If the County were to take on the role of developer we would have to spend another 20 million dollars or more to complete the project and there would be no guarantee that we could reach a deal with a big name retailer to anchor the site. Boyer was selected because they demonstrated that they can deliver these types of retailers, and have completed several retail projects in Utah with such retailers as Walmart, Borders and Wild Oats.

If we choose to go forward with a different developer we simply don’t know whether the County could secure a better deal or whether the new developer would be successful in securing a big box store. The economic conditions that Boyer faces, high rent costs and high construction costs, would also factor into the ability of any other developer to make a deal with the County. Is there any reason to think that we could reach a deal faster with another developer? I am not convinced. Furthermore I can not dismiss the possibility that we will enter into lengthy negotiations with another developer only to have those negotiations fail and we end up without a big box store.

There is a path forward, separate from the three options presented here tonight. This option is to have the County continue its negotiations with Boyer without deadlines and without discussions with other developers. I want to emphasize to the public that as I see it we can complete a deal with Boyer now and part of this deal could be the phased development of the site together with the use LEDA economic development funds from the County for some of the utility and road work associated with the site. I believe that the citizens want the Council to take this path, rather than have Council move away from Boyer and in so doing kill the big box store. We should not take a step backward we need to proceed forward. We should not constrain ourselves to artificial deadlines, and we shouldn’t allow others in the community to use the complexity of the situation, all the tasks that remain, and the very real economic challenges facing the developer as excuses to kill the project.

We’ve heard the excuses before such as the following examples: we could have a monopoly for groceries and medicine, all we may get is just a big box store and not the other kinds of businesses that are needed for a town lifestyle center, retail businesses are failing nationwide and it is time for us to consider using the site for other things such as a new municipal building or a new graduate college.

At present more than one potential anchor has expressed interest in the site and discussions are ongoing. There may or may not be a monopoly. Although a monopoly is undesirable, what is even more undesirable is not to have the kinds of retail goods that people want locally, and most undesirable is watching significant amounts of GRT revenue from retail flowing out of our community. Using the Trinity site for anything other than a big box store is a slap in the face to the majority who voted for Ordinance 529 and does nothing to help those families who now travel great distances to get the goods they need. We will not be successful in broadening our economy, attracting new businesses and young families to our community if we don’t create local retail options for the basic amenities. We need big name retailers in our community and we need a big box store.

Council has worked very hard for years to address the need for more retail and now we must be willing to make an additional effort to reach a deal with Boyer, rather than terminating the negotiations prematurely as all three of the options presented tonight would bring about. I support continuing our negotiations with Boyer only because I see no better way to get a big box store in the near future. I urge Council to reject the three options before it, and renew our commitment to reaching a deal with Boyer. We need to fulfill the promise made to the voters who spoke emphatically to the Council when they approved Ordinance 529 with the understanding that there would be a new retail development in Los Alamos with a big box store as its anchor. Are we as Council members going to listen to these voters or turn our backs on them? In my mind choosing any of the three options presented this evening would ignore the will of the voters and eventually kill the big box store.

This concludes the remarks that I made at tonight's meeting. There will be another Council meeting on the Trinity site project on August 13th at 7pm in Council chambers. At this time Council may decide on one of the three options presented tonight.

The Boyer Negotiations are not Dead

We had a council meeting Tuesday night in White Rock and there were some interesting comments at the end of the meeting. I want to share these comments with the public because I don't know whether they will be covered in the Monitor or not.

Councilor Mike Wismer announced at the end of the meeting that council will have a public meeting on Trinity site on July 23rd at 7pm in council chambers in the community building. He started his statement by saying that no forward progress has been made with Boyer for the past 24 months and that the negotiations are currently stalled. He went on to say that the time has come to let the public know the details of what is going on. On July 23rd staff will present a report about what Boyer originally proposed to do and what progress has been made over the past two years. Then options will be presented to Council with regards to the future course of the project. The July 23rd meeting will be followed by a second meeting on or about August 17th to make a decision about the future course of action. The July 23rd date is set but the date in August is not finalized. I will post the date for the August meeting on this blog when it is finalized.

After Mike concluded his remarks I made a few comments of my own. First I disagreed with his characterization of the situation with Boyer and I said that the negotiations have not stalled. I went on to say that many people are concerned about the comments in the paper on Sunday with regards to the 30 day deadline and that as a public service I must let the public know that Boyer has not notified the County that negotiations will end in 30 days. I then asked the County staff to contact Boyer and invite a representative from Boyer to participate in the meeting on July 23rd. I said that I have several questions for Boyer and the public needs to know the answers from Boyer directly. Lastly I was critical of the fact that the public will only have 8 days of notice for the meeting on July 23rd and that it will be hard to notify all the interested people in this time frame because many people are away on vacation.

I think it is important for the public to know that Boyer has not notified the County that negotiations will end in thirty days. Contrary to how the situation was portrayed in the Monitor I believe that Boyer is committed to doing this project and the Monitor article is inaccurate. There are many in the community who want to put blame on Boyer and use this as justification to get another developer. In my view without Boyer there will be no big box store. Furthermore in my opinion negotiations with Boyer will not end unless Council decides to terminate them. This is a very real possibility, but I have no idea how Council will decide the issue.

I only know for certain my position and I want to reassure the public that I am committed to the big box store. Our community needs this kind of retail for a variety of reasons as I outlined in my editorial. We must not forget the majority of voters who approved Ordinance 529 with the understanding that we would finally get a big box store. I will not forget them, not for one second.

Please share this message with everyone in the community: Supporters of Ordinance 529 must come to the Council and say that they want to continue with Boyer and that we must have a big box store.

Trinity Site Development

Welcome to my new blog which I created to help keep Los Alamos residents informed on important events in the County. My first entry is an editorial that I wrote about development of the Trinity site which appeared in the Los Alamos Monitor on Wednesday July 8th. I encourage Los Alamos County residents to express their opinions about this issue to the Council at the email address: countycouncil@lacnm.us .


Let’s Stay True to the Original Plan

When the voters approved the referendum on Ordinance 529 it was with the understanding that the Trinity site would be anchored with a big box retail store and that lease revenue from the site would go to our Schools with GRT revenue from the big box store going to the County. I strongly support this vision which is a true partnership and has benefits for both the County and Schools.

The Monitor’s February 22nd editorial suggested that it is time to look at other options and expressed the possibility of placing a new municipal building on the Trinity site. I couldn't disagree more with this point of view. Terminating negotiations with Boyer now and placing a new municipal building on the site would utterly destroy any chance of getting a big box retail store in our community, and would be an insult to the voters who sent a message to Council that they want more retail.

The need for more retail was clearly shown in a 2004 study by the POLICOM Corporation which indicated that on a per capita basis Los Alamos consumers spend about 11% of their personal income on retail within the County, whereas the rate in other communities in New Mexico is about 40%. This statistic is frightening in that it represents a huge leakage of retail dollars out of our community. The County shouldn’t just give away large amounts of GRT revenue from retail to other communities, yet that is exactly what we are doing. The only way to correct this situation is to increase retail opportunities with a big box store.

We are not going to attract new businesses to our community and broaden our economy if we do not provide retail for the basic amenities, the kind represented by a big box store. This type of retail is taken for granted in many other smaller communities such as Taos, Socorro, Espanola and Las Vegas, where on a per person basis retail spending is significantly higher than in Los Alamos County. These communities have a smaller population than Los Alamos and a considerably lower per capita income yet they all have big box stores. According to the POLICOM report the required amount of retail space to adequately meet community needs is about 40 square feet per person. Los Alamos County has less than half that amount. We fall far short in this one important aspect of quality of life, retail space. The Trinity site is arguably the best retail location in the County and using this location for a new municipal building isn’t going to provide the needed increase in retail space, rather it will stifle retail growth in our community for years to come.

Placing a new municipal building on the Trinity site will subvert the will of the voters who approved Ordinance 529 and as a community we should not do this. We should honor the voters who have spoken and not betray their trust. We have an obligation to make it easier for families who now travel great distances to purchase the goods they need because these goods are not available locally. We also have an obligation to ensure that the County receives income from future activities on the Trinity site. Once construction is complete the County would receive not even a single cent of GRT revenue from a municipal building on the site, but would still be obligated to make rent payments for the land. This is not a good deal for the County. Sixty six million dollars of public money is being spent for the new Airport Basin facilities which will house staff currently on the site. The task of relocating staff and demolishing the existing buildings will cost the County approximately $10 million. We have already committed far too much public money to abandon our original goal of expanding retail with a big box store.

It has taken longer than expected for the County and Schools to finalize their agreements for the Trinity site. Without a signed agreement between the County and Schools which governs the terms of the site master ground lease it is understandable that a retail developer would not want to commit to sublease the site from the County. Furthermore when the land transfers take place between the County and Schools and the master ground lease is signed approval from the State Board of Finance will still be required.

It is not in our best interests to terminate negotiations with Boyer at this time. Boyer was selected through a public process involving multiple competitors because of its proven track record in completing similar kinds of retail development projects in Utah with retailers including Walmart, Wild Oats, and Borders. Continuing to work with Boyer affords us the only realistic chance of getting a big box retail store on the Trinity site and developing the rest of the property in a cost effective manner.

The most important reason to have a big box retail store on the Trinity site is to provide an additional revenue source for our Schools. State money to our Schools for operating expenses has been reduced recently, irrespective of the proposed new funding formula, and as a result we have already witnessed cuts in sports programs and other activities, with the possibility of additional cuts in the future. Our Schools are in a tough position. The best thing we can do to help our Schools overcome this situation is to move forward with putting a big box retail store at the Trinity site.

The County needs to take three steps to enact the vision behind Ordinance 529. First, the County should minimize the amount of rent the Schools pay for their new facility at the Airport Basin as much as possible. Second, the County should commit to paying the full rent to the Schools regardless of whether there are new buildings on the Trinity site or not, and move forward with the master ground lease. In this way the Schools are assured a steady income no matter what the pace of development turns out to be. However, the County can only afford to do this if it gets future GRT revenue from the big box store. Third, the County must work with the developer to put a big box retail store on the site as soon as possible, making available economic development funds to the developer according to the terms of the LEDA bill recently amended by the State legislature.

The message from the referendum on Ordinance 529 is clear: Council, put a big box retail store on the Trinity site and make sure that our Schools get as much income as possible from the deal with no risk. Yet in our community there are persistent calls that we change course now and remove the big box retail store from our plan. Without further involvement by the supporters of Ordinance 529 in the ongoing debate we may very well end up with a new municipal building on the site instead of a big box store and this would not be a good outcome for our community.

Vincent Chiravalle

Los Alamos County Councilor