Cabela's plans to seek special tax district in Wichita

Cabela's, the outdoor retail giant that recently announced plans to open a store in northeast Wichita, wants the city to let it charge 1.2 percent more on all sales to help finance the project and add on-ramps to the K-96 and Greenwich interchange.

Cabela's plans to submit its application this week for a community improvement district that would allow the store to charge 1.2 percent more.

Jamie Gull, Cabela's director of real estate, said the special fees were key in the company's internal decision to locate here. But he stopped short of saying the company would kill its plans without the special fees.

"We would have to basically start from scratch," he said.

If all goes as Cabela's plans, the 80,000-square-foot store would open in the Regency Lakes Shopping Center at 21st and Greenwich by spring 2012.

Gull declined to say how much money the improvement district would generate because it would expose anticipated sales figures.

He said an undetermined portion would help pay for a project that would make the K-96 and Greenhich interchange accessible from all directions.

The interchange now allows access to Greenwich from eastbound lanes of K-96 and an exit from Greenwich to only westbound K-96.

The new store would be significantly smaller than the existing ones in Kansas City, but it would feature taxidermy and a small mountain replica similar to those in some of the other 31 stores nationwide, Gull said.

The company plans to hire up to 200 employees from the Wichita area.

The community improvement district incentive Cabela's is seeking is a relatively new tool that was approved by the state legislature in 2009. It is being used frequently for commercial projects across Wichita.

It allows cities to approve special districts where businesses can add up to 2 percent more to their sales without listing it on price tags or otherwise notifying consumers.

The districts can last for up to 22 years.

Wichita further limited the use of community improvement districts in several ways, including a web site disclosing where improvement districts are and requiring businesses to post signs next to their entrance that say "THIS PROJECT MADE POSSIBLE BY COMMUNITY IMPROVEMENT DISTRICT FINANCING."

The signs don't explain how such districts work or what percentage fee consumers will pay.

Some council members and community members have pressed for more specific disclosure.

The money generated by the additional fee can be used for a wide variety of expenses, including construction, parking, landscaping and ongoing operational expenses, including security, promotion and employee training.

The city doesn't require businesses to prove they have a financial need for the special fee unless the business wants the city to loan the money up front.

Most of the growing number of businesses that seek the special fees are collecting the extra fee after sales are made

Cabela's has sought and received incentives from local governments at other locations, including STAR bonds, which divert all new state and local sales taxes to eligible development expenses, for its location in Kansas City, Kan.

Gull said Cabela's is seeking a community improvement district because the incentives are locally-controlled, have clear guidelines and are processed quickly.

"It was an important tool to understanding what we could do here," he said.

It helped make the financial models work, he said.

"I don't want to overly singing its praises because it's not my role," he said. "But that was part of our decision making process."