Courting Costco

Goodness knows I’ve devoted enough of my life to grocery stores to weigh in on the Costco debate. State Sen. Ellie Kinnaird is leaning hard on town leaders in Chapel Hill and Carrboro to reach out to the members-only warehouse store that sells groceries and pretty much everything else you’d need for daily living. Durham has a Costco, and many other big-box stores that draw shoppers and their tax dollars out of Orange County. Kinnaird wants such a sales-tax revenue generator for Orange County, not to mention the additional jobs for her constituents, jobs that pay more than double what Costco’s competitors pay, if Kinnaird’s information is correct.

And who could argue with that? The problem is where would you put a Costco? Chapel Hill and Carrboro are fairly saturated with grocery stores. The only spot that will need a grocery store in the near future is Franklin Street, what with the boomlet of condos opening up. But Franklin Street wouldn’t fit Costco’s criterion of being close to an interstate. And besides, where would customers park?

Chapel Hill’s economic development officer, Dwight Bassett, said Costco has two options that he can see: 30 acres near the intersection of Eubanks Road and I-40, not far from the Harris Teeter at Chapel Hill North, and a spot in Ram’s Plaza, where it would replace or compete with Food Lion. Siting a Costco where it could put another established store out of business seems somewhat counterproductive from a tax revenue-generating standpoint.

I’d like to see Costco put its store in Village Plaza on Elliott Road in the desolate gap where the Village Plaza Theaters used to be. Zoning and parking in place; plenty of homes nearby to form a customer base; different enough from Whole Foods so as not to compete.

And if the increased tax revenue eases the pressure on property-tax payers, what’s not to like?
– Nancy Oates

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  1. Duncan O'Malley

     /  September 7, 2010

    Hmmm… Interesting idea.

  2. There are several reasons why Elliot is a poor location. Beyond backing on Booker Creek, the site has poor access to Elliot, the two landowners battled over that access during the Federal Cinema debacle, the typical Costco footprint is huge in comparison to the existing commercial entities.

    I believe the Chapel Hill North site floated by Dwight shares some of these same problems.

    While there’s a chance that Foodlion might be displaced by a Costco at Rams Plaza, in terms of brownfield large enough to build a typical Costco, transit access and capacity, building a more sustainable commercial sector on that stretch of Fordham , availability, environmental factors and other similar reasons, that site is probably the best one in Chapel Hill.

    As mentioned elsewhere, focusing on retail over other economic drivers is problematic but, realistically, retail is the easiest and quickest way to build up our commercial tax base. Lobbying Costco, a company which seems to adhere to the same kind of economic, social and environmental goals as folks living here, makes sense. It’s a shame there isn’t a wider palette of such businesses to pick from.

    Whatever the outcome, I appreciate Ellie’s efforts to stir real debate on our current commercial development strategies. Before “big box” served as a knee-jerk litmus test for some local groups. No nuance allowed. As Ellie, Laurin and others have noted, “big box” comes in all sizes, with a variety of good and bad impacts. Maybe now we can move away from the monolithic, group-think that has characterized discussion of economic strategy (next up – the fantasy that the only “good” dense development is high priced condos and boutique shopping “villages”).

  3. Anton Shahu

     /  September 7, 2010

    I don’t see how one can try to lure Costco while at the same time hiking the tax rate. Purchasers of big ticket items are sensitive to that extra .25% …

  4. Geoff Green

     /  September 8, 2010

    Costco has said, though (and I believe this was referenced in one of the N&O/Chapel Hill News articles about the issue) that they prefer to be located near interstate highways. I wonder if Rams Plaza is close enough to I-40 to count. Moreover, they’ll need to work out some better way for traffic to access Rams Plaza, because I expect a Costco would drive much more traffic than the current occupants of the site and the Fordham/Ephesus intersection could get crammed up.

  5. Jake Anderson

     /  September 9, 2010

    One thing not to like is that sticking a huge store close to I-40 will encourage nearby sprawl and isn’t a good idea if we want to make the city less car-dependent. Also, as you said, every neighborhood in the city (except Franklin Street, which isn’t under consideration) already has a grocery store. We have a wide range of stores where we can buy pretty much anything. As for the sales tax/jobs thing, Costco’s employment and sales would likely be at the expense of its competitors. I don’t see the point of attracting them.