MOUNT PLEASANT — The village Wednesday began discussing how to avoid being stuck with any “white elephants” someday: vacant, derelict big box stores.
Mount Pleasant doesn’t have any currently. But the Plan Commission on Wednesday began taking suggestions from staff members and hearing about other communities’ big box ordinances.
Wauwatosa, for example, requires a developer to pay an annual fee into a fund that can be used later if the city is stuck with a vacant retail building, said Brennan Kane, village deputy planning director. He thought the fee is 2 cents per square foot.
“It’s used to buy properties and tear them down as needed,” he said.
Some communities require a departing retailer to submit a plan for its reuse or raze the building within a year, Kane said. He suggested that be required as the business closes.
“I think (any ordinance passed) should set forth up front how they will reuse, market or tear down,” he said.
Community Development Coordinator Logan Martin said if the ordinance created a demolition fund, it could be used on a different property than the one that created it.
Planning and Development Director Ron Meyer said any big box ordinance would only apply to future commercial and retail properties, as part of the conditional-use permit.
An alternative to a demolition fund, Meyer said, is requiring the developer to provide a surety bond, which is essentially an insurance policy that would pay out if the business closes.
But he cautioned that policies can expire and companies can go bankrupt, rendering a bond useless. “Then it’s difficult or nearly impossible to get someone to renew.”
“When Circuit City nationwide went bankrupt and closed,” Meyer said, “who would issue that (bond)?”
Kane said some big box ordinances set a minimum size building — he suggested 15,000 square feet. Anything larger, and the ordinance requires a third-party market study paid for by the developer, with the municipality having the right to deny the project.
Many ordinances, Kane said, also set a cap on how large a commercial building can be constructed; he said 125,000 square feet is about average. The City of Kenosha used such a cap to say no to a large Walmart store, he said.
But Meyer was cool to the idea of a cap. “I wouldn’t want to discourage economic development,” he said. If Costco wanted to build a store near Interstate 94, he said, “A cap could keep them out.”
Meyer said he thought the reason for the discussion was to avoid white elephants such as the abandoned Sam’s Club at 6200 Regency West Drive in the City of Racine. In 2008 Wal-Mart Corp. announced its closure, and it became a big warehouse.
One difficulty when a big box store closes is carving it up for smaller tenants. One discussion point offered was to require retail building designs that facilitate redevelopment and use by multiple tenants.