Town Von Maur Project Gets State Help As Mall Objects

Financing for a $100 million retail and office complex to be anchored by a Von Maur store got a boost Tuesday as state lawmakers endorsed a plan to give the Town of Brookfield power to create a tax financing district.

Mayor Steve Ponto and the owner of Brookfield Square mall objected to the plan and the speed with which the state Senate and Assembly approved it — less than two weeks after the bill was introduced. 

The state Assembly Committee on Jobs, Economy and Small Business voted 13-1 Tuesday in favor of giving the town the power to create a tax incremental financing district for redevelopment — an economic tool reserved for cities and villages. Milwaukee Democrat Peggy Krusick cast the sole dissenting vote. The full Assembly later approved it on a voice vote. The state Senate approved it 19-0 last week. 

The bill (SB 21, AB 38) would give only the Town of Brookfield — and no other towns — the TIF authority and only for the proposed Von Maur retail and office project dubbed Poplar Creek.

Towns are allowed to create tax incremental financing districts for environmental cleanups. The Town of Brookfield created a so-called e-TIF for the 2007 construction of the Marcus Corp.'s Majestic Theater. The Marcus Corp. also is the company that would benefit from the TIF endorsed by the state Assembly Tuesday. The Poplar Creek project involves 19 acres that include Marcus' former West Point Cinema that was shuttered when the Majestic was built, as well as a small shopping center and a vacant Menards.

Town Administrator Rick Czopp said the new complex would be a boon for the town and Waukesha County, increasing the tax base at that site from about $10 million to about $100 million. 

Czopp also said it would create about 400 construction jobs and another 400 retail and office jobs after occupancy.

"This project is huge," he said. "We've been getting very positive feedback from both town and city residents who have either called or e-mailed. People are excited about this."

But Ponto and mall owner CBL & Associates Properties Inc., of Chattanooga, TN, said the project will not create new jobs but would largely transfer jobs by luring existing city and town tenants into the new shopping center north of I-94 and east of Barker Road.

CBL wrote a letter to lawmakers that said: "In addition to just moving jobs around, this development will flood an already saturated retail and office development."

Ponto said vacancy rates along the Blue Mound Road corridor are about 15% for retail and more than 20% for office.

CBL sent lawmakers a Feb. 28 e-mail in which NAI MLG Commercial agents contacted Brookfield Square mall tenant H&M and attempted to lure it to move to the new project it said would be in excess of 600,000 square feet. 

Ponto said some existing and potential mall tenants have been "hesitant to commit to new leases" due to the proposed Poplar Creek and town TIF district.

Ponto told lawmakers: "This is not economic development — this is poaching."

The mayor said he wants to Von Maur to open its first Wisconsin store in Brookfield, but would prefer to see it at Brookfield Square mall rather than as part of a new open-air complex he said could fail to fill.

Ponto said he hoped Von Maur would reopen talks with CBL that fizzled last year after more than a year of discussion.

Czopp objected to the job-shifting argument and said the city was being inconsistent with its stance on new development. He noted the city has approved new restaurants and shopping centers that also could siphon tenants and customers.

"Why did they allow those restaurants to be built at the mall? " Czopp asked. "Aren't those restaurants in competition with other city restaurants? Why wasn't Target a threat to take away jobs from others?"

 Czopp said he was surprised the city was opposing the project.

"To be against economic development, to me that's mind-boggling," he said. "How many developments are out there that are creating 800 jobs?"

Ponto and the League of Wisconsin Municipalities said they were concerned the state was setting a bad precedent by giving a town a power long kept from towns.

"The town should really become part of adjoining incorporated municipalities," Ponto said.

Czopp said the town remained interested in getting approval to be incorporated as a village. But the town lost two previous attempts to become a village. 

The town's financial consultant, Ehlers & Associates, is drafting a tax incremental financing district plan. The cost of public improvements needed for the Poplar Creek development — such as building a new water tower, building roads and realigning town sewer lines — is not yet known, Czopp said.

Under a tax financing district, the property taxes collected on the new construction would be used to pay for the public improvements. Only after those improvements are paid would the additional tax revenue be shared with the town, county, Waukesha County Technical College and the Waukesha and Elmbrook school districts. 

Czopp said he believed Marcus Corp. would file preliminary plans to be reviewed by the town Plan Commission in "the next few weeks."