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Cabela's asks for special fee, on-ramps

Cabela's, the outdoor retail giant that recently announced plans to open a store in 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 add 1.2 percent more to the bill. The extra charge would be included in the sales tax.

The City Council could vote to set a public hearing for the proposal in coming weeks.

Jamie Gull, Cabela's director of real estate, said Wednesday that the additional revenue was 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 is projected to generate because that would expose anticipated sales figures.

He said an undetermined portion would help pay for a project that would make the K-96 and Greenwich 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 plan drew praise from Mayor Carl Brewer and council member Sue Schlapp, whose district includes the future Cabela's site.

"We want to look at every avenue we can to make sure they come and every avenue, excuse the pun, to have proper roads that provide accessibility," Schlapp said.

Brewer said he's happy that Cabela's may contribute to road improvements the city will likely need someday anyway.

"In this case, they're coming in as a tourist attraction, and they will cause other businesses to grow, and they're investing in helping those other businesses grow by helping out with the highway," he said.

The new store is a prototype that would be significantly smaller than the existing 180,000-square-foot store near the Kansas Speedway in Kansas City, Kan. But it would feature taxidermy and a small mountain replica similar to those in some of the other 31 stores nationwide, Gull said.

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

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 limited the use of community improvement districts in several ways, including a website 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 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. The Kansas City, Kan., site uses STAR bonds, which divert all new state and local sales taxes to eligible development expenses.

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 their financial models work, he said.

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

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