ALEDA director: ‘Tens of millions’ offered in incentives to Hy-Vee

Published 8:00 pm Tuesday, September 26, 2017

Albert Lea Economic Development Agency Executive Director Ryan Nolander said local entities offered Hy-Vee tens of millions of dollars in incentives before the company confirmed earlier this month it is in the exploratory phase of making plans to build a new distribution center in Austin.

Ryan Nolander

Local entities offered incentive packages, which included tax increment financing and tax abatement, water and sewer extensions, cash incentives to offset land acquisition costs and waiving permit and review fees, Nolander said Monday during an Albert Lea City Council meeting.

Email newsletter signup

Albert Lea was one of 12 locations in Minnesota to submit a proposal for the project. Albert Lea at one point in March was eliminated from the running because of the cost to grade the site off of Freeborn County Road 46 on the edge of Albert Lea, but after submitting a revised proposal, the city made it back into the running and became one of the top three communities for the project. After months of consideration, the city of Austin ultimately was chosen.

“While we are obviously disappointed in that, it is a good thing for our region, for Austin,” Nolander said. “And we are going to see some cross between Albert Lea and Austin with this project, should it move forward.”

Earlier this month, Hy-Vee Vice President of Communications Tina Pothoff said the Austin site is being considered based on its centralized location in the company’s eight-state territory, interstate access and Austin’s workforce.

Nolander disagreed with comments by community members that taxes in the community are too high to attract business and local entities do not offer quality incentives to attract businesses. He said negative posts on social media are seen by people who do not live in the community.

“Be careful with what you put out there,” he said.

A letter sent earlier this month from the Minnesota Department of Employment and Economic Development Agency to Nolander and City Manager Chad Adams said Hy-Vee was impressed with Albert Lea leaders’ ability to find a solution to the site constraint and the abilities to work together to support economic growth.

According to the letter, the company’s decision was driven by logistics and site characteristics, with the Austin site determined to be the more ideal location based on the projected growth of the company.

DEED Business Development Director Jeff Rossate echoed those statements Monday to the council.

“The site that was being proposed here was a very viable site,” he said. “The site in Austin just happens to be slightly more visible from the interstate and closer to an existing interchange. Those would be the things to me that are the biggest factors in the difference between them. They seem very small, but for clients, they have their factors and how they weight them. This happens to be what I’m assuming was part of that conversation.”

Hy-Vee is looking at a 150-acre site on the western edge of Austin north of Interstate 90 by the Oakland Avenue exit. Hy-Vee has said construction could begin as early as 2019.

Hy-Vee has distribution centers in Cherokee, Iowa, and Charlton, Iowa. Both centers employ several hundred people.

About Sam Wilmes

Sam Wilmes covers crime, courts and government for the Albert Lea Tribune.

email author More by Sam