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Eastown may lose Costco

By Dennis Box-The Courier-Herald

Is Costco to be in Bonney Lake or not to be? It's a very good question.

The matter of Costco Wholesale Corporation, which is based in Issaquah, building a membership warehouse in Eastown came up at the Dec. 4 City Council workshop.

Deputy Mayor Dan Swatman briefly discussed the issue, noting he understood the city had lost Costco to Sumner because of traffic impact fees.

“We don't know for sure,” Swatman said. “But we think it is a done deal (Costco locating in Sumner).

City officials have said Sumner's fees are considerably lower than Bonney Lake's, but the city is apparently willing to work with retailers to reach a solution.

Although the rumor circulating through City Hall has Costco landing in Sumner, Mayor Neil Johnson said nothing is cast in stone - or cement.

“We'd love to have Costco on the Plateau,” Johnson said. “I don't think they have applied for permits (in Sumner). We have to find a way to attract businesses and make sure the start-up costs are not too much for them to be able to make it. We have to find a balance.”

According to Bonney Lake officials, the traffic impact fees for a discount club store could run about $1.5 million for a 120,000 square foot building. If the store was considered a different type of retailer it could run as high as $2.8 million.

Traffic impact fees are designed to pay for about 50 percent of the road improvements needed after a business is built. The other half is paid by the city.

An option the city could consider to entice Costco involves a plan where a percentage of the impact fee is given back as a sales tax rebate. This type of incentive has been used by the Washington cities of Marysville and Covington.

The basic plan is if the store shows at least $200,000 to $300,000 in sale tax revenue to the city every year for the first three years, half of the traffic impact fees would be rebated through sales tax revenue.

Swatman said the city's impact fees are appropriate.

“Someone has to pay for required traffic improvements and there are only two parties available, the citizens or the developer,” he said. “It can't be 100 percent for either one. We are still willing to negotiate with Costco. And just because Costco goes down in Sumner may not stop them from going to Eastown.”

According to sources, the most likely spot Costco may build in Sumner is in the north part of the city near 24th Street.

Dennis Box can be reached at dbox@courierherald.com.

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