MAN ABOUT TOWN: First (and Last) Trip to BJ’s
By GEORGE SOUTHERN
Falls Church Times Columnist
November 1, 2010
If you know the Man About Town, you’re not the least surprised that he’s down on BJ’s. After all, what does he like?
Oh, right – he likes the “village atmosphere” of Falls Church.
Well, if it takes a village, BJ’s comes up lacking. I’d call it the least village-y spot in our City.
Not that it’s hardly even part of our City – stuck out there east of Eden on 8.4 acres that no one short of City officials probably even realized fell inside City limits.
So it really doesn’t matter if the developer cut down over 100 mature hardwoods and paved the whole lot with impermeable asphalt. BJ’s neighbors, who formerly backed onto a forest, don’t even vote in the City.
But just for the sake of argument, what if BJ’s had tried to locate in the center of the City. Would we have welcomed it with open arms?
For two years I’ve heard nothing but hosannas for the new BJ’s – the savior of the Little City. It’s commercial development like this, we’re told, that will enable the City to survive.
As my daughter taught me to say, Gag me with a spoon.
Before you brand me as an elitist so-and-so — for the record, I shopped at BJ’s Landmark location for seven long years. At the time we were feeding and outfitting a family of six, and it was the cheapest place I could find. Many a miserable Sunday afternoon was spent in BJ’s, dragging two or even three massive carts to the checkout. So my prejudices come deeply ingrained. In the end the kids grew up, we moved to Europe and learned a different lifestyle, and upon our return chose a “village” to live in. We never looked back at BJ’s, and never dreamed that one day BJ’s would come looking for us.
At least the new BJ’s is more palatable than the concrete shell at Landmark. I noticed polished floors, and there’s less of a warehouse feel. But to me there will always be something unappetizing about putting a gallon of milk and a flat-panel TV in the same shopping cart.
If there’s one commercial establishment that epitomizes what we love about Falls Church, it is, of course, Brown’s Hardware. And BJ’s is the antithesis of Brown’s Hardware. I rest my case.
No, wait – there’s more. No story of BJ’s is complete without telling the part about the tax break. Because to attract BJ’s, the City agreed to pay the developer up to $3 million over 12 years. In turn, the developer would charge below-market rent to BJ’s, enabling BJ’s to offer below-market prices to its customers.
What’s not to like? Well — plenty, if you happen to be Giant Foods or any other City business impacted by BJ’s. It’s the fairness principle. Giant – and even Brown’s Hardware, for that matter – have to charge their customers enough to pay market rent on their places of business. And they’ve been supporting the City for decades. Now the City has enticed BJ’s with a $3 million tax break, effectively reducing BJ’s cost of doing business. Is that fair to the competition?
I felt so passionate about this that on October 27, 2008, I wrote the following letter to the Falls Church News-Press:
Editor:
I, for one, have no objection to seeing BJ’s locate in Falls Church, and in fact probably would purchase some items there that I currently buy at Giant or Staples. Many other shoppers might do the same if BJ’s offers lower prices. But if I were a competitor of BJ’s I would be very upset by a City plan that effectively lowers BJ’s cost of doing business.
The key sentence in the City’s proposal is: “There is a significant delta between market rent that the owner can obtain for leasing the site and the rent that BJ’s can pay to make their ground lease economically feasible.” In other words, although on paper the $3 million tax subsidy goes to the developer, in reality it goes to BJ’s in the form of lower rent. Apparently it is only “economically feasible” for BJ’s to offer lower prices if they enjoy lower costs than their competition.
How can we be a business-friendly city if we award a tax break to a would-be competitor to existing city businesses?
The News-Press did not see fit to publish my letter. Frustrated, perhaps, I became involved in an upstart online publication called the Falls Church Times. But I held my peace on BJ’s – until now.
By George Southern
November 1, 2010
Falls Church in the News
It will be interesting to see how much direct competition BJs offers to Giant. I was in BJs during the soft opening. I did find they had a reasonable selection of smaller packaged items but not everyone can use a 40 roll package of TP. Another thing: The price of a package of butter went up a dollar between the soft opening and the regular opening.
Very happy to have BJs in the City. Competition for Giant? I don’t think so…they mostly fulfill different needs.
I haven’t been to BJ’s yet, no need for massive bulk purchases yet. I do want to hear more about that $3 million subsidy, though. Can someone tell us all how that works? If the City is short of cash where is this coming from?
(EDITOR: Up to $250,000 a year, for 12 years, would be rebated from taxes paid by BJ’s. See our Oct. 19, 2008 story for the complete staff report.)
Just for the record — my neighbors and I (those folks who used to back onto 90′ of woods and who now look out at the back of BJ’s) are in fact City residents (I’ve lived in the City for 35 years at this point) and while I can’t vouch for my neighbors’ voting habits, I do indeed vote in the City.
Carol is right; anyone that has needed to shop at BJs knows its primarily for organizations, large parties, and large families. Giant will be fine. The Arlington Costco might have reason for worry though.
My second thought is that if you have to disclaim your elitist statements, perhaps they are what they are…
This will probably lead to tax generation over the long-term, correct? If so, I don’t see a problem. I think BJs is a useful addition to FCC, and well located.
George, that’s a good question about whether or not the City would have been up for placing BJ’s in the center of the City and not out on the edge. I do think folks are interested in maintaining a modern version of the “village” you like and having a BJ’s in the middle of things wouldn’t have fit in well.
The other proposed use for that location was as a used car lot.
Here’s a hypothetical question – if Falls Church was part of Arlington or Fairfax County could a BJ’s-like store end up in the center of the City? I’d bet the chances would be a lot greater. Bother Arlington and Fairfax already have many big box stores – I assume they’d have no problem dropping more in our 2.2 square miles.
I live at the east end of town and welcome BJ’s as a competitor to Costco, Safeway, and Shoppers. I’m not a big fan of subsidies, but $250K a year for 12 years (the present value of which is rather less than $3 million) is not a tremendous price to pay when you consider the former use generated and what by-right uses would have gained us.
But, George, I’m glad you started the Times!
Went once also, bought a card, probably won’t go again. Have no need for bulk shopping and their Kleenex is more expensive than either the Giant or Safeway.
I’ve rarely read more elitist crap. I guess you preferred Noland’s asphalt on that lot to BJ’s. I suggest you return to Europe and stay there. As a 72-year-old native of the city of Falls Church (and a graduate of its school system), I welcome BJ’s to Falls Church. I’ve been shopping at the Landmark and Fair Oaks BJ’s for years, and it is nice having one conveniently closer. We don’t need jerks like you telling us how superior you are to the rest of us. Oh, and for the record, my father worked at Brown’s hardware in the ’30s and I can remember when Brown’s was a general store. I still shop there when I can.
GEORGE REPLIES: Whew! And I can’t even cry all the way to the bank. Guess I’ll have to go back to writing about City politics and finance. Should be something newsworthy tonight (Monday).
wow: i think Mr. White needs to “take a chill pill”, as my boys like to say..calm down, good sir. George is only raising good questions about what types of stores we want in Falls Church…hardly a reason to be exiled to Monaco or San Marino…keep up the interesting reporting, George.
George,
I like BJ’s. I will continue to shop at Safeway, Harris Teeter and Whole Foods. I am hesitant about shopping at Giant because of their car towing policy.
AND, we don’t live in a village any more…. we are watching the urbanization of our City.
ALSO, I hope everyone in Falls Church saw the wonderful Washington Post article about our city on October 29, 2010 “Small Town Feel – Big City Benefits.” This neighborhood guide noted 9 special places. There are many more….and… Brown’s Hardware was mentioned! No mention of BJ’s!
Shop at BJ’s, shop at another Falls Church City business, it really doesn’t matter, as long as you shop at Falls Church City businesses as much as you can.
For my take, BJ’s is serving the desired purpose – it is bringing greater tax dollars from an underused commercial property and it is bringing people who do not live in FCC here to shop. Witness residents of the higher density apartments across the street carrying BJ’s goods home and Arlington residents turning left on Wilson out of the BJ’s parking lot. Witness FCC residents, excluding George and a few others, spending their money here in town rather than at the BJ’s in Fair Oaks. It’s good for BJ’s and good for Falls Church City taxpayers.
It’s articles like this one that undermine my ability to take George’s ideas about the impending demise of Falls Church seriously. If a purely commercial development that will likely draw many shoppers from Arlington and Fairfax is unacceptable, then what exactly would be OK to build in the city? At some point the City has to make some attempt to expand tax revenue and this seems like a worthwhile project particularly if it keeps me from driving to Costco in Arlington. George’s answer seems to be that we shouldn’t even try because we are doomed as an independent city. Apparently, we would be better off ourselves being subsidized by Arlington County. If that doesn’t work with the Falls Church way, we could be swallowed up but pay some additional taxes like Vienna. Where’s the workable solution being proposed?
George, I was on the EDA when the BJ’s deal was made. After confirming with the EDO, here is the deal: The tax sharing agreement begins the first full fiscal year following the opening of the store. That means the city will receive all local tax revenue until June 30, 2011 when the agreement actually kicks in.
Beginning July 1, 2011, and for the next 12 years, the city will receive the first $450,000 in all local tax revenue generated each year by the store. For 12 years the city and the developer will split dollar for dollar the next $500,000 in tax revenue produced above $450,000 each year by the store. Once a $950,000 threshold in local tax revenue is achieved in a given year under the agreement, the city will receive all additional tax revenue. Therefore, for the developer to receive a full $250,000 under the agreement in any given year, the city will have received at least $700,000. To look at cumulative totals over the 12-year period of the agreement, the city would receive at least $8.4 million for the developer to receive its $3 million.
Once the 12-year agreement expires, the city will receive all local tax revenue generated by BJs. BJs has signed a 20-year lease with multiple options for renewal of the lease. If BJs generates $950,000 per year in tax revenue for the city, that will represent about a 10% increase in overall revenue from sales tax — quite a yield from one source. That is the net fiscal perspective on the deal.
In terms of additional background, when JBG purchased the Noland site, they quickly made plans to lease the site to CarMax. The used auto company spent considerable money to put together a preliminary site plan to replace the existing Noland warehouse with a massive parking lot, a sales office and a small service garage. The city asserted itself by advising JBG that this was not a use that the city desired. The city initiated action to amend our zoning ordinance to make the CarMax use infeasible at the site. Among other issues was the fact that sales tax revenue from vehicles flows straight to Richmond with no direct revenue benefit to the city. While many states share auto sales taxes with local jurisdictions, Virginia doesn’t. Auto dealers already occupy large tracts of prime commercial land in the city of Falls Church.
The BJs deal would not have happened without the tax sharing agreement. The project required public participation to defray extraordinary infrastructure expenses to redevelop the site for high-volume retail use. Numerous other retailers, including Costco, examined the site and passed. The BJs deal was the second largest retail lease signed in the entire DC region in 2009, according to the Washington Business Journal. Quite a coup for the Little City, but, yes, it required some creative and aggressive deal making to achieve a strong, net tax revenue result, none of which is “out of pocket,” but rather tied to the store’s business performance.
Thanks for the thorough recap, Barry. This is a solid deal for FC City and Rick Goff deserves the credit for hanging tough with JBG. FC had a chance for a Price Club way back when on the Duck Pin Bowling, now Pearson Square site. There was very little support for that venture and I think that one went to Pentagon City, negotiated by a private-public partnership for Arlington.
Maybe we should ask Mr. Brown to bring back the dairy case.
Thank you Mr. Buschow. So the City is not paying $3 million, the City is rebating a share of revenue we would not have gotten if BJ’s weren’t here. Seems like a reasonable deal. I don’t object to BJ’s having paved over the site, it’s not like that kind of dingy pile of concrete slabs that constituted the old building was doing anything to give the Little City the air of a quaint village.
Looked forward to BJs, but after going there, a little disappointed. Just regular “stuff” in bulk, which I guess for large families is great. Prices aren’t any less than HT, Giant, or Safeway. In comparison, Costco always has an interesting food find and they have more of a selection in general, definitely better produce. That said, I wish BJs success.