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April 12, 2012

Council to decide on construction agreement with Sam’s

Four of five ‘yes’ votes required at April 17 meeting

Rebecca Hattaway Staff Reporter

OWASSO —  

At their regular meeting next week, both the Owasso City Council and the Owasso Public Works Authority will decide on the proposed Construction Agreement between the city and Sam’s Club.
Sam’s Real Estate intends to purchase approximately 30 acres of land northeast of the intersection at 96th Street North and 129th East Avenue, of which 18 acres will be used to construct a 136,000 square foot Sam’s Club. Five additional lots will be prepared and available for retail and business use.
“After assessing the proposed site, a fair amount of improvements were evident to prepare the area for this development as well as future growth to that part of the corridor,” Owasso Economic Development Director Chelsea Harkins said in a memo to the council. 
The memo detailed the infrastructure needs to serve the site:
 
Water Service:
Staff has recommended construction of a new 16-inch water main approximately 1.2 miles from 96th Street North and Garnett Road to the development along the north side of the existing Walmart. The line would be in a private easement and utilize public right-of-way where possible and for the crossing of U.S. Highway 169.
 
Sewer Service:
The closest sanitary sewer line capable of serving the site is on the west side of CVS Pharmacy. This line would need to be extended east to the southeast corner of the CVS building and then north to the site.
 
Transportation Service:
Recommendations are to widen 96th Street North to 138th East Avenue; 129th East Avenue to the ODOT frontage road; and the ODOT frontage road from 129th East Avenue to 99th Street North. Signals are recommended at the entrances on 96th Street North and on the frontage road.
 
“Building the ideal plan in the beginning is optimal rather than coming back after construction on the site, adding cost and congestion,” Harkins told the council. “The proposed improvements will accommodate additional traffic in that area for the next 20 years.”
The estimated cost for the public improvements is $4,566,300. Sam’s would initially pay all costs incurred for the design and construction of the improvements.
Sam’s Club is contributing $500,000 toward the project.
“The Construction Agreement outlines a plan that would allow Sam’s to be reimbursed an estimated $4,066,300 of the actual costs of the public improvements from the sales tax generated on that site,” Harkins said in the memo. “The reimbursement would only come from revenue generated from this site to include Sam’s Club and any future businesses located on any of the out lots.”
The store is projected to generate $1.8 to $2.2 million in sales tax revenue annually.
“The agreement provides that Sam’s would be reimbursed up to one-sixth of the agreed amount annually,” Harkins’ memo said. “Based on estimates of sales tax that would be generated by the project, the city would receive additional sales tax of $10.8 to $13.2 million over a six-year period. After reimbursement to Sam’s of $4,066,000 for the public improvements, the city would still have an estimated $6.7 to $9.1 million of increased sales tax revenue during those six years.”
City Planner Bronce Stephenson said that Sam’s Club has been working with city staff to develop plans that fit within the proposed U.S. 169 Overlay District suggestions.
“Sam’s from the very beginning has worked with the staff’s desires to make this architecture interesting,” he said. “It will look like more than just a warehouse.”
Plans include a boulevard entrance, landscape areas, and screening for rooftop equipment.
“It embodies so much of what we’re trying to do with the U.S. 169 Overlay and the new parking ordinance,” Stephenson said. “We wanted to make sure this represents Owasso...They were very receptive to that in helping us to achieve that goal.”
The agreement will require four out of five affirmative votes by the city council and OPWA on April 17.

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