Warren McCord: West Pace no different than any other development

This newspaper devoted its entire Feb. 15 front page and a special section to a commercial development project in Auburn called West Pace.

For more than a year, the city of Auburn and a developer have been in negotiations regarding an agreement under which the city would provide certain incentives as a means of enhancing the quality and feasibility of a commercial project in the southeast quadrant of the I-85/South College Street interchange. Because of the prominence given the project, some readers may assume that economic development incentives are new or unusual. Quite the contrary.

Alabama state government has been participating in economic development through the building of roads, bridges, interstates and interchanges and railroad spurs, and the federal government has been providing funds to do so, for many years. Most, if not all, of our commercial development is located on, or near, a publicly built street or highway.

In the late 1960s and early 1970s, Alabama cities began developing industrial parks, often using federal loans or grants, and began to give tax incentives to manufacturers. Under the Wallace and Cater Acts, tax-exempt bonds became a widely used tool to provide incentives for industrial recruitment. Most Alabamians now agree that the incentives used to lure auto manufacturers and other industries to Alabama were good for the state. It is accepted that they bring more to the community than the incentives cost.

Retail and restaurant businesses have immediate impact on budgets in cities where they locate, particularly through sales taxes. In addition, nationally known, upscale retailers and restaurants enhance a city’s reputation and visibility, catching the attention of other similar businesses that may be interested in the area. Synergy is created and retail leads to more retail, leading to more revenue for more or better services, and on and on. Major retail developers know their potential impact on governmental revenue and are now using this fact to induce incentives from local governments.

In 1999 and 2000, the Alabama Legislature passed laws that further facilitate the process of providing local government incentives to commercial development projects through tax increment financing, the creation of improvement and capital improvement cooperative districts, and other tools. A number of large-scale retail projects in Alabama have been or are being developed using one or more of these tools, to include TigerTown in Opelika, Highpoint Town Center (Bass Pro Shop) in Prattville, Eastern Shore Center in Spanish Fort, EastChase in Montgomery and Celebrate Alabama in Opelika.

So, in an effort to ensure that a prime commercial site is annexed and developed with amenities that will attract quality businesses and lure customers, Auburn is working, like these other cities did, with a developer to create an agreement that protects the public interests while facilitating a quality project. It’s nothing new, but it is important. It is good that the newspaper and public are interested.

Warren McCord is chair of the Auburn Commercial Development Authority and member and past chair of the Auburn Planning Commission. He can be reached at blmccord@bellsouth.net.