Menards Making Plans to Build Facility in Sullivan - The Missourian: Saint Clair

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Menards Making Plans to Build Facility in Sullivan

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Posted: Wednesday, December 4, 2013 6:00 am | Updated: 8:26 am, Wed Dec 4, 2013.

The city of Sullivan was expected to take another big economic development step on Tuesday night when its board of aldermen considered approving a contract with Menard Inc. for a 103-acre tract of land in the city’s Industrial Park East located on the Interstate 44 South Service Road.

Sullivan City Administrator J.T. Hardy told The Missourian on Monday that the contractual agreement with the Wisconsin-based company secures the land for one year so Menards can conduct its environmental studies and other research on the property.

The purchase price is $443,000, which Hardy said is the appraised value of the land.

“We’ve been in conversation with Menards since earlier this year,” Hardy said. “This deal gives them a 365-day window to do their planning and research and puts the land under contract so we can’t sell it to anyone else during that time.”

The property is located where Glaser Road and the I-44 South Service Road come together on the extreme northeast side of the city. It is next to the old Sullivan Pottery business. Hardy said basically the deal sells the entire industrial park property, which was annexed several years ago, to Menards.

During Tuesday night’s board of aldermen meeting, Sullivan’s city council was expected to consider and approve Bill 3605, which, according to the meeting agenda, approves the “purchase and sale agreement with Menard Inc. ... containing 103 acres, more or less, located along the East South Service Road in the city of Sullivan for a total purchase price in the amount of $443,000.”

The agenda goes on to say that passage of the bill would approve the agreement with Menards “with a formal closing on the property in approximately 365 days.”

“I expect this to pass without any difficulties,” Hardy told The Missourian on Monday.

Economic Development

Hardy said Menard Inc. plans to take advantage of Sullivan’s Enhanced Enterprise Zone. That means Menards cannot use the property to build a retail store. Instead, it has to be a distribution center or something centered on industrial or manufacturing.

Hardy said he can’t comment on exactly what Menards plans are for the site since the company requested it make the formal announcement. However, Hardy did say that the facility will be “the only one of its kind in Missouri” as far as what the company has planned.

The city administrator said one of the key components of the deal was rail access. The property is located next to the Burlington Northern Santa Fe Railroad tracks that travel from St. Clair to Sullivan and beyond in both directions.

An EEZ is an economic development program designed to assist communities that qualify. In order to qualify, the unemployment rate in the targeted zone must be higher than county and state figures, and 60 percent of the median family incomes in the zone must be lower than 90 percent of the county and state average.

It is offered through the Missouri Department of Economic Development.

The zone works by supplying a tax abatement program for current businesses that want to expand or new businesses that want to relocate. The maximum a company can get under state law is a 90 percent tax break for 20 years, and the minimum is a 50 percent tax break for 10 years.

Sullivan’s EEZ features the 90 percent maximum tax abatement over 20 years. The zone was approved by the state earlier this year.

To receive tax credits, the company using the EEZ must create and maintain the minimum of two new employees and $100,000 in new investment for a new or expanded facility or two new employees and a $1 million investment for a replacement business facility.

An EEZ cannot be used for retail development or expansion.

Hardy said details with water, sewer and electricity still must be worked out. There currently are no water lines to the property, and Menards needs to present an “electrical plan” to the city as far as its expected needs. The city’s sewer treatment plant is near the property.

Hardy also said the city has been in contact with the Missouri Department of Transportation regarding traffic flow at the Stanton I-44 exit. He said he was told by MoDOT officials that the interchange is “underutilized” and should not need any major improvements to handle any increased traffic because of a Menard Inc. facility locating in Sullivan.

Menard Inc. is based in Eau Claire, Wis., and is a privately owned company. Its website states it has 280 home improvement stores in Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, Wisconsin and Wyoming.

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