Quote of the Day

...they’re not going to let Moscow hold up the process any further.

- Whitman County Commissioner Jerry Finch, "Hawkins water supply: Moscow pegs water rates at 2.5 times in-town charge," Whitman County Gazette, July 24, 2008

An excerpt from the story can be found below:

Largent said the county will now assess the costs of getting water from a well instead of from Moscow.

“What we have to figure is that we’re not a captive market,” said Largent. “Now we have to gauge (the city’s offer) by how much it would cost to dig wells.”

If Moscow and Whitman County fail to come to an agreement, Hawkins would be able to drill water under the three water rights the company acquired last year.

Commissioner Jerry Finch said the company has already drilled one well, and is in the process of digging a second. Calls to Hawkins to confirm were not returned.

If Moscow provides water to the shopping center, Finch said, the company would cap its wells.

“But they’re not going to let Moscow hold up the process any further,” he commented.

If the city does provide water, Hawkins would have to relinquish its water rights.

Largent said that makes it vitally important that a water agreement is drafted to prohibit Moscow from turning off the tap.

“We want an iron clad assurance if water rights are given up, that the development’s ability to draw water from Moscow goes on in perpetuity,” said Largent.

The county and city will now negotiate to come to a price agreement.

"Water rates hearing could focus on shopping center"

Oh, joy. Another chance for Moscow's self-appointed experts in hydrology and urban planning to pontificate.

From today's Lewiston Tribune:

MOSCOW - The Hawkins Companies shopping center proposal could get another public airing Aug. 4 when a hearing will likely be conducted here on proposed interstate water rates.

Details are still being worked out.

Members of the Moscow City Council on Monday night proposed charging Whitman County 2.5 times the normal in-town rate for water. Whitman County officials, in turn, are considering offering the water to the Hawkins development.

The company has expressed a desire to buy Moscow water, but needs to work through a government entity to obtain it. In the meantime, Hawkins continues to drill its own wells just over the border in Washington.

The proposed interstate water sale appears to be unprecedented and continues to be monitored by the Idaho Department of Water Resources. The agency has authority over pumping and allocating Idaho groundwater.

The city of Moscow, at the direction of IDWR, has proposed a joint-powers agreement with Whitman County. County commissioners have asked for a cost figure before signing an agreement.

All parties expressed an interest to expedite the process by having a joint meeting of officials. But that apparently won't happen until after Moscow holds the public hearing and city councilors vote.

Hawkins has dubbed the shopping center the "Stateline Project." Plans call for 714,000 square feet of retail stores, including three possible big-box outlets. A Lowes home improvement center is projected to be one of the anchors.

Proponents have called the development the beginning of much-needed retail growth in the Moscow-Pullman corridor. Opponents countered the shopping center represents unnecessary sprawl and threatens groundwater resources.

Hawkins indicated landscaping and other construction might start as early as June 1. Company spokesman Jeff De Voe has not given a reason for the delay.

"MOSCOW: Council puts price on water; Cost to supply water to Hawkins will be more than double the in-town rate"

I can appreciate that Moscow wants to share in the tax revenue obtained from the Hawkins development. No doubt, Whitman County and Pullman would have loved to share in the tax revenue from the Palouse Mall and Wal-Mart too, considering half the customers that shop at those stores are from Washington. But I don't recall anyone making that offer.

The Whitman County Commissioners are not about to share any tax revenue from Hakwins. The citizens of Moscow elected Queen Nancy and the last City Council that passed the big-box ordinance which drove Home Depot and a Wal-Mart Supercenter out of town. They will have to content themselves with the proceeds of selling the water to Hawkins for now and vote their frustrations out on the Her Majesty next year.

From today's Moscow-Pullman Daily News:

The city of Moscow may charge Whitman County two-and-a-half times the in-town commercial rate for water for a retail development just across the state line.

Most Moscow City Council members agreed Monday night that the rate, plus a 5 percent administrative fee, was a fair charge. Moscow plans to sell the water to Whitman County through an intergovernmental agreement for use only at the Hawkins Companies' development, just across the state line from Moscow.

"I think it's a reasonable amount," City Councilman John Weber said. "I think it's a defensible amount."

The city agreed in February to provide Hawkins water at a rate that is "fair and reasonable and consistent with rates and charges set for similarly situated customers of the city." However, Moscow has no similarly situated customers.

Whitman County Commissioner Michael Largent e-mailed City Supervisor Gary Riedner earlier this month asking him to clarify how much the city plans to charge. Riedner replied with a letter explaining that Moscow normally charges customers who are out of the city limits twice the in-town rate, but does not have a rate for out-of-state customers. Riedner then asked the City Council for further guidance.

Councilman Wayne Krauss, who first proposed charging two-and-a-half times the in-town rate, said after the meeting that he felt it was "a good middle line."

"You don't want to get the appearance that you're price-gouging," he said.

Krauss said the city can charge what the market will bear, but "what this market will bear, I don't know."

He said the extra 50 percent charge doesn't entirely make up for the tax revenue Moscow would get if the development was in the city.

Councilman Tom Lamar did not agree to the proposed rate, saying it was irrelevant without some sort of analysis to back it up.

"I think that Moscow should try to get the highest rate that it possibly can for selling water across the state line," he said.

Lamar proposed working with Whitman County to share some of the taxes the county makes from the Hawkins development. Councilman Dan Carscallen also supported tax sharing.

Lamar, who has resisted selling water to Hawkins or Whitman County from the beginning, said he still is uncomfortable with the sale.

"I don't think that we should be encouraging this development by having cheap rates and no tax sharing," he said.

Largent said today he was pleased the council came up with a rate, though he has no basis to judge it right now.

"I think we have to look at it and look at the cost to pump our own water" and other factors, he said.

The council will finalize the rate at a public hearing, which most likely will take place Aug. 4.

"Hawkins goes ahead with well drilling; Company wants to build shopping center; disputes over water may have delayed project"

There is a mistake in the article below from today's Lewiston Tribune. It was Commissioner Greg Partch that speculated in last Friday's Moscow-Pullman Daily News that the national and regional economy may have delayed Hawkins breaking ground, not Commissioner Michael Largent. In exclusive comments made to Palousitics last Monday, Commissioner Largent stated that:

Commissioner Greg Partch's comments in Friday's Moscow Pullman Daily News suggesting the national or regional economy may be to blame is simply his speculation. My personal speculation differs from Greg's in that I believe the regional economy remains strong for this project. However, national credit markets have posed additional requirements for Hawkins requiring them to get much further along with their tenant commitments than earlier anticipated before they can have their financing package in order to begin major construction.

From today's Trib:

MOSCOW - Crews with a well-drilling rig continued to work Thursday just over the border into Whitman County on Hawkins Companies property where a 714,000-square-foot shopping center has been proposed.

No information on whether water had been found was available. Jeff De Voe,spokesman for the Boise-based company, did not return a phone call from the Lewiston Tribune.

"I just learned they were drilling about an hour ago," Walter Steed, a Moscow city councilor, said late in the afternoon. "So certainly, I don't know what they've accomplished."

The drilling continues amid negotiations for the city of Moscow to provide municipal water to the Hawkins site. Moscow Mayor Nancy Chaney said talks are ongoing with Whitman County commissioners and the matter will go before the council Monday night.

Chaney said Whitman County commissioners had some questions about a draft joint-powers agreement proposed by the city. "The question revolves around, 'How much are you going to charge us?' " Chaney said.

The joint-powers agreement is apparently necessary before the Idaho Department of Water Resources will consider approving the transfer of groundwater across the border into Washington. The transfer, officials said, must be between two governmental entities, not between a government and a private company.

In the meantime, no signs of construction are apparent on the Hawkins acreage, other than a dirt road leading to, and landscaping around, the drilling site. Only the top of the drilling rig can be seen from the Moscow-Pullman Highway corridor.

The shopping complex, proponents say, will give the region a retail boost and signal the start of further retail development in the corridor. Opponents have said the complex - to be anchored by a Lowe's home improvement center and possibly two other big-box stores - represents unnecessary sprawl and a threat to the local groundwater supply.

Speculation also remains about why construction has been delayed. De Voe, earlier this year, said Hawkins planned to start moving earth around June 1. He declined comment two weeks ago about reasons for the delay, or whether work was imminent. Whitman County Commissioner Jerry Finch has blamed two years of delays on Moscow officials who challenged Hawkins' water rights. He also said two weeks ago that despite the company drilling for water, another construction season has essentially been lost.

Commissioner Michael Largent speculated the Hawkins construction delay had more to do with a nationwide economic downturn than water problems. De Voe three months ago said the state of the economy at that time would not figure in Hawkins plans. He also said the project would go forward even if Moscow failed to provide water.

Hawkins secured its own water rights for what the company is calling the "Stateline Project," only to have Chaney appeal to Washington state authorities. The appeals were dropped after new Moscow city councilors worked behind closed doors with Hawkins to create a plan to provide city water over the border.

Steed said the company wants to secure its own water source just in case the cross-border deal fails.

He said he's also encouraging everyone involved to expedite the negotiation process. "Let's get to the table."

Indeed, this item from the Moscow City Council's agenda for Monday seems to confirm that:

8. Request for Direction for Response to Whitman County Regarding Water Rates for Stateline Project - Gary J. Riedner

At the Public Works/Finance Committee held June 23rd transmittal of the Joint Powers Agreement between City of Moscow, Idaho and Whitman County, Washington For Purposes Of Providing Limited Water Services to the Stateline Project Draft Agreement was authorized. City Attorney Randy Fife sent the draft Joint Powers agreement on Thursday June 26. On July 2, Whitman County Commissioner Michael Largent sent the City Supervisor an email requesting clarification of Section 2, subheading C) "Cost of Service" which refers to class of customers and resulting rates that could be applied to the Hawkins development. The City Supervisor responded to Commissioner Largent's inquiry and outlined the fee resolution process in "setting reasonable rates and fees for City services" noting that the "current fee resolution does not contemplate the provision of water or sewer services to customers located in the
State of Washington." The City Supervisor also noted that he anticipates that the "City Council will adopt a reasonable rate for this service."

ACTION: Provide staff with direction pertaining to the response to Commissioner Largent's inquiry including the potential range of fees and propose a meeting schedule for negotiation of the Joint Powers Agreement between City of Moscow, Idaho and Whitman County, Washington For Purposes Of Providing Limited Water Services to the Stateline Project Draft Agreement or other such action as deemed appropriate.

"Moscow officials plan to push water deal for Hawkins"

This is good news, and expected. From what I know about the pro-growth Moscow City Council members, they believe in free enterprise and are stand-up guys. Some of them even read Palousitics regularly.

Here's hoping the Hawkins water issue gets resolved quickly.

From today's Lewiston Tribune:

MOSCOW - A majority of city councilors here want to keep a proposed interstate water deal with Hawkins Company on a fast track, two councilors said Tuesday.

"We're operating under good-faith here," Councilor Dan Carscallen said. "By gosh, if we're going to do it, let's do it."

Councilor Walter Steed agreed. "Ever since we took office in January, when the Hawkins project was put on our plate on day one, we have been pushing to try and provide water to the Hawkins state line project."

Hawkins wants to build a 714,000-square-foot shopping center just over the border into Washington's Whitman County. Hawkins spokesman Jeff De Voe has said his company will either drill for its own water, or tap into Moscow's waterline that butts up against the 204-acre development site.

Carscallen and Steed responded to criticism Monday by Whitman County Commissioner Jerry Finch, who said Moscow city government caused at least a two-year delay in construction by raising questions about and filing appeals over groundwater concerns.

"The previous council is the reason for that," Carscallen said. "The people had to unelect that bunch and get a new one in to make something happen."

In addition to Carscallen and Steed, Councilors Bill Lambert, John Weber and Wayne Krauss have endorsed providing water to the Hawkins development. Only Mayor Nancy Chaney and Councilor Tom Lamar have voiced opposition.

Despite the support, no deal appears imminent - unless Carscallen and Steed get their way. They said they favor meeting immediately with Finch and fellow Whitman County commissioners Greg Partch and Michael Largent to reach an agreement.

Steed questioned whether the current delay has anything to do with water. "I don't see how water, at this point, could be a hold-up. Because they've got both us working on selling them water, and I understand they have bid contracts to drill wells, which is their backup source."

Finch said De Voe told him last week well-drilling equipment would be on-site this week and drilling could start within the next two weeks.

The shopping center, with a Lowe's home improvement center as one of its anchors, has been touted by Whitman County officials as a boon to the local economy and the beginning of much needed retail development in the Moscow-Pullman corridor. Critics say, in addition to possibly draining the groundwater supply, the development represents the beginning of unnecessary retail sprawl.

"This council has not tried to second-guess developers," Steed said, especially across the border in Washington.

At this point, it appears officials at the Idaho Department of Water Resources are demanding Moscow and Whitman County establish a joint-powers agreement for water to be supplied across the state line to Hawkins.

A draft of the proposed joint-powers agreement has been forwarded to the Whitman
County commissioners and Finch said it's being reviewed.

Is the Cold War Between Moscow and Whitman County Back On?

It appears that the short period of Détente enjoyed between Moscow and Whitman County since January is (temporarily?) over.

If you read Queen Nancy's rambling and paranoid missive concerning Hawkins, it's not surprising really.

Now, to quote April, Hawkins needs to drill here, drill now, and worry less about Moscow.

From today's Lewiston Tribune:

Progress stalls on shopping center

Disputes over water have set project back two years, Whitman County commissioner says

MOSCOW - Development of the Hawkins Companies shopping center just across the border into Washington has been delayed again, a Whitman County commissioner confirmed Monday.

"They've lost a construction season, that's what it boils down to," Commissioner Jerry Finch said. "They're going to get some work done this fall, but they're not going to have any construction until next year."

Jeff De Voe, spokesman for Hawkins on what's being called the "state line project," declined comment about when construction might begin.

"He's speaking of his own opinion, not mine," De Voe said of Finch. "A lot of things are happening. I don't have anything for you quite now. As of today, it's just quiet."

In April, De Voe estimated earth-moving equipment would start work at the site around June 1, weather permitting.

But Finch, one of the principal proponents of the development, said he talked with De Voe last week and received an update on delays. The proposal calls for a 714,000-square-foot shopping complex with a Lowe's home improvement center as its anchor.

Finch blamed the latest and previous construction delays mostly on Moscow elected officials who've stymied progress by questioning the development's impact on regional groundwater supplies.

"I think this is a stalling technique to kill the project," Finch said, referring to an initial Moscow appeal of Hawkins water rights transfers by Mayor Nancy Chaney, and subsequent slow progress toward reaching a possible agreement for Moscow to provide water services over the state line.

"That, quite frankly, has set this project back about two years," Finch said of the water issues.

His words come two weeks after members of the Moscow Public Works Committee agreed to forward a draft joint powers agreement to Finch and the other Whitman County commissioners. The agreement is necessary before officials at the Idaho Department of Water Resources will consider interstate transfer of a municipal groundwater supply.

"We've been reviewing it," Finch said of the eight-page draft, adding his cursory assessment has left him thinking more negotiation might be needed. He said the county's legal counsel must review the document before anything is sent back to Moscow. The agreement is necessary because IDWR, which has authority over groundwater, wants the water transfer agreement to be between two governmental entities, not between a city government and a private company.

In the meantime, Finch said, De Voe assured him Hawkins will move ahead with or without Moscow's participation. "I was assured by Mr. De Voe last week that drillers would be on site," Finch said of the company's intentions to drill for its own groundwater. "They're going to drill regardless. Hawkins is doing this on their own. They are not willing to gamble with Moscow."

Finch, who has worked closely with Hawkins on promotion of the shopping center, said the company would "cap" any wells it drills and retire its water rights if an agreement is eventually reached with Moscow. He said drilling could start in two weeks.

But the 204-acre construction site appeared to remain untouched Monday. This despite De Voe saying in April that a ribbon-cutting ceremony would likely be conducted to publicly announce the start of construction. A sign promising arrival of the shopping center remained standing Monday.

Finch and fellow commissioners Michael Largent and Greg Partch have heralded the Hawkins shopping center as the beginning of retail development in the Moscow-Pullman corridor. Likewise, Pullman officials have endorsed the project as a much-needed economic catalyst.

Critics, mostly in Moscow, have said it's the beginning of unnecessary retail sprawl. Pro-development candidates who were elected last November to the Moscow city council have couched their support in terms of the development being "inevitable" and Moscow needing to tap into profits by supplying water.

Hawkins completed its $5.45 million purchase of the development site in April. In addition to Lowe's, plans show room for at least two additional big box stores as well as a number of other retail outlets.

"Hawkins water supply details move forward; Joint powers agreement is in the works"

Just a brief note to the article below that appeared in today's Lewiston Tribune. Jeff DeVoe of the Hawkins Companies did indeed say that they hoped to break ground on the Stateline Retail Center in June if the the land had dried out. If you have been on the Palouse lately, you know our weather has been anything but "dry" this year, with 1.5 inches of snowfall covering the ground just two weeks ago. I wouldn't read too much into the fact that ground hasn't been broken yet.

MOSCOW - While construction on the controversial Hawkins Companies shopping center has yet to begin, officials took an important step here Monday toward sealing a deal to supply water to the development.

Members of the Moscow Public Works Committee agreed to forward to Whitman County officials a draft joint powers agreement. Such an agreement is apparently necessary before the Idaho Department of Water Resources will consider allowing Moscow to provide water services over the state line to Hawkins.

Committee members Walter Steed, John Weber and Wayne Krauss questioned the need for the agreement, but decided to let the Whitman County commissioners review the draft before forwarding it to the full Moscow City Council for consideration.

"Undoubtedly Whitman County is going to have some items that they want to address," Krauss said.

Among other things, the eight-page draft proposes formation of a three-member governing board to oversee allocation of Moscow's water into the state of Washington. Two board members would be from Moscow's city council and one from the Whitman commission, according to the draft.

Jeff De Voe, spokesman for Hawkins, could not be reached for comment. He said more than two months ago the shopping center would be built regardless of whether a water deal could be reached with Moscow. The company already has water rights in Whitman County.

But De Voe also said at the time construction would likely begin in June and a ribbon-cutting might be conducted to announce start of the 714,000-square-foot complex. As of Monday, only a Hawkins sign reading "Coming Soon Major Shopping Center" indicated anything imminent at the site.

The shopping center, reportedly to be anchored by a Lowe's home improvement center, is designed to accommodate three so-called big box stores and eight smaller retailers. Whitman County officials have touted the project as the beginning of retail development in the Moscow-Pullman corridor. The site is located immediately across the border from Moscow and butts up to city water lines.

Moscow Mayor Nancy Chaney appealed Hawkins' attempts to transfer water rights in Washington to supply the shopping center. The mayor reasoned the complex threatened the aquifer that supplies the Palouse. But an agreement was eventually reached for Moscow to supply Hawkins' water needs.

Chaney and Councilor Tom Lamar have gone on record against the supply agreement, while all other city councilors voted in favor. The agreement was reached in February and most participants said they thought the deal would be completed before the construction season started. But the IDWR determined any kind of supply agreement must be between two governmental entities, not between a government and a private business.

"City to send water sale application to IDWR this week"

Things keep moving along with the Hawkins development.

From the May 28 issue of the Moscow-Pullman Daily News:

The City of Moscow will send off its application this week to the Idaho Department of Water Resources to provide water services across the Washington state line.

If the application is approved, Moscow will sell water to Whitman County though an intergovernmental agreement.Whitman County will then provide the water to the Hawkins Companies' 714,000-square-foot retail development just across the state line from Moscow.

Moscow agreed to provide water to Hawkins in a February settlement agreement. In turn, Hawkins is expected to retire water rights it had secured from the Washington State Department of Ecology.

Hawkins reviewed the IDWR application, as per the agreement, and made a few suggestions. One was correcting a typo, which City Supervisor Gary Riedner said will be done before the application is sent. Hawkins also requested to review the intergovernmental agreement. Riedner said drafts of the agreement will be made available to the public.

Hawkins also requested that the application to IDWR reference all of Moscow's water rights rather than just those connected to Well No. 9. Riedner said Well No. 9 has plenty of water rights to fulfill the city's obligation.

Riedner said the city will look into whether it should include more water rights, but the City Council Public Works/Finance Committee members directed him to send the application to IDWR first.

Councilman Wayne Krauss said the deal with Hawkins had nothing to do with which water rights are used, so the city is not obligated to change that part of the application.

"We need to send this down to IDWR," he said. "This is becoming more complicated. There is more red tape becoming involved in it."

"Largent: County may want to tweak water-sale agreement"

One of Ronald Reagan's signature phrases was the old Russian proverb "doveriai, no proveriai", meaning "trust, but verify."

Hawkins and Whitman County are taking the correct approach with regards to Moscow's involvement in the Stateline Retail Center.

At least for the next two years, we can count on Moscow's full support of the project. But all it takes is one election to turn back the clock to the Cold War we had just a few months ago. So it is wise that Hawkins and Whitman County pursue a separate sewer system and look at ways at keeping the water rights Hawkins originally requested in case a future Moscow City Council decides to turn off the spigot.

From yesterday's Moscow-Pullman Daily News:

Whitman County Commissioner Michael Largent said some changes might be in store for a negotiated water sale between the city of Moscow and Hawkins Companies.

The county became involved in the process following a request by the Idaho Department of Water Resources, which asked Moscow to reach an intergovernmental agreement with Whitman County for the water sale rather than deal directly with a private entity across state lines.

Moscow City Supervisor Gary Riedner updated the City Council's Administrative Committee on Monday about the city's water-sale application to the IDWR. The city has finalized a letter signed by Mayor Nancy Chaney and Largent informing IDWR that the city and county are negotiating an intergovernmental agreement for the water sale.

The water will serve Hawkins Companies' 714,000-square-foot shopping center, which will be located in the Pullman-Moscow corridor, just west of the Idaho border. The Boise-based company finalized its purchase of the land April 9. The city agreed in February to provide water services to the development in exchange for Hawkins retiring two water rights it had secured.

Largent said he thinks the city is doing the best it can to move the application forward. However, because Whitman County was not involved in the negotiation process, it may bring some new issues to the table.

"We'll have to look and talk about some issues that may not have been of import to (Moscow and Hawkins) but are important to Whitman County," he said.

The main issue that concerns Largent is the water rights Hawkins agreed to relinquish in the settlement agreement.

"My question, personally ... is I'm wondering whether those water rights wouldn't be better held in trust by another entity and not used," Largent said. "It's difficult to construct an agreement in perpetuity that is iron-clad."

Largent said the rights could be kept "in active reserve." They would not be used unless something happened that caused Moscow to stop providing water across the border.

Largent said the city and county haven't entered into negotiations about the intergovernmental agreement, but he thinks the process will go smoothly.

"Working with the city of Moscow recently has been a joy. I think they're well-meaning. I think they're bargaining in good faith," he said. "I anticipate it will be a fair and good-working relationship."

The city also gave Hawkins the option of purchasing sewer services. Hawkins spokesman Jeff DeVoe wrote a letter to the city May 5 declining sewer services. The letter did not specify why the company declined the services, and DeVoe could not immediately be reached for comment.

Riedner said he faxed the Moscow/Whitman County letter and IDWR application to Hawkins Companies for review today. The City Council will review any changes Hawkins requests at its Monday meeting, if Hawkins responds in time.

"I would imagine it's up to them how long it takes them to review it, but I would assume we're going to get it back fairly quickly," Riedner said.

The city will then send the application and letter to IDWR. Riedner said the city is committed to getting the application in as quickly as possible.

Whitman County also has been looking for ways to pay for the infrastructure that will connect Hawkins to the Moscow water system.

"Eye utility district: Moscow cannot supply water directly to Hawkins"

Looks like Whitman County is getting into the water business. Good. Now everyone can't scream that Moscow is selling water directly to Hawkins as part of some under the table sweetheart deal.

In any case, Hawkins is wisely going to dig a well just in case things with Moscow or IDWR don't work out down the road.

From yesterday's Whitman County Gazette:

Whitman County will have to enter into a formal agreement with Moscow if the city is indeed going to provide water service to Hawkins’ companies’ stateline strip mall.

Commissioners Monday agreed to do just that after receiving a letter from Moscow’s City Supervisor Gary Riedner stating the Idaho Department of Water Resources would not allow the city to sell its water to an out-of-state private business.

Commissioners signed a letter stating they intend to work with Moscow to act as the public entity that would accept the city’s water as an intermediary for Hawkins.

Commissioner Michael Largent said he was still uncertain if the county would simply receive a water bill and pass that cost on to Hawkins or if a utility district would need to be formed.

If the county and city can reach an agreement that suits the Idaho water authority, Moscow will provide up to 45 acre-feet of water for use inside the stores in Hawkins’ 714,000 square-foot development.

Cross-border cooperation is a new approach for commissioners, who were previously angered by Moscow’s appeals of the shopping center.

Moscow’s council filed appeals at several stages of the development’s permit process, and those appeals angered commissioners to the point that Commissioner Jerry Finch told the Gazette last year that “hell will freeze over” before he cooperates with the city on future projects.

Finch’s tune has changed since then.

Moscow voters last fall elected a slate of pro-business candidates to replace the council that had filed appeals over Hawkins’ use of water and pollution controls.

Finch Monday said he does not foresee any tension in these negotiations, crediting Moscow voters for “changing the tenor” of the city council.

“We do have to work all our issues out,” said Finch.

“But the new council is certainly amiable enough. And you know that I’m an easy-going teddy bear,” he said with a wink.

Largent was appreciative of the new council’s decision to drop those appeals and to sell the city’s water to Hawkins.

“I want to note that we very much appreciate the compromise from the new council across the border,” said Largent.

Earlier this year, Moscow decided to drop its appeal of Hawkins’ quest for four water rights. That appeal was dropped as the two parties reached a settlement in which Moscow would pipe water to the site if the company dropped its applications for the water rights.

The agreement was reached during a mediation with the state Department of Ecology.

Regardless of the outcome of the negotiations to purchase water from Moscow, Hawkins is planning to drill a well at the site this summer.

Public Works Director Mark Storey put out a call for bids on drilling the well today.

Under the agreement, the company retains a right to pull water from the ground until water service from Moscow begins.

The accord also ensured the town of Colton would have the right to draw 100 acre-feet of water from Union Flat Creek.

Finch added the well will provide insurance for the company in the event that Moscow decides to turn the spigot off in the future.

The company may also need the water while preparing the site for construction.

Hawkins spokesman Jeff DeVoe told the Gazette last month that excavation of the 700,000 square foot site will begin as soon as the soil dries out enough.

To administer the water swap, the county may have to form a utility district, said Finch. In a meeting with Port of Whitman commissioners Monday afternoon, he said the port would be the most appropriate agency to oversee such a district.

"Hawkins planning to break ground; Company to begin work on development as soon as land dries out"

When that first shovel of dirt is turned at the Hawkins development, things will change on the Palouse forever. We will finally break the iron grip of the anti-growthniks.

Hawkins represents all that they despise: "sprawl," big boxes, chain stores, automobile-based development, crass consumerism, and most of all, capitalism and free enterprise. But the leftists in both Pullman and Moscow were infected with Wal-Mart Derangement Syndrome and Hawkins slipped in under the radar. Queen Nancy's single-handed efforts to stop Hawkins were easily undone by a single election.

Now, a shopping devleopment three times the size of a Wal-Mart Supercenter is going in and there is nothing anyone can do to stop it. What a great feeling! I only hope I can be there for the groundbreaking.

From today's Moscow-Pullman Daily News:

Hawkins Companies officials expect to begin moving dirt for its 714,000-square-foot retail development just west of the Idaho border by the start of summer.

"The target is June 1, but if the land dries out it will be before that," company spokesman Jeff DeVoe said. "We've got two years of moving dirt ahead, so we've got to get moving."

A ground-breaking ceremony will take place once construction equipment has arrived on site, but an exact date has not been set, DeVoe said.

Several national retail chains have expressed interest in locating at the shopping center, even in the face of a struggling national economy. However, only one tenant - Lowe's - has formally committed to date.

DeVoe said the company expects the Lowe's store to be open in late summer or early fall 2009.

DeVoe said Hawkins doesn't anticipate any issues arising that could derail the project, considering water has been secured and a deal has been reached with Whitman County to finance public infrastructure for the development.

"At this point I don't think so," DeVoe said. "We are sitting ready to go."

Whitman County Commissioner Michael Largent expressed appreciation for Hawkins and its commitment to locating in the county.

"I am very pleased. This is a culmination of a long process," Largent said. "The Hawkins group and Jeff DeVoe worked very hard to bring this project ahead.

"We are very happy to see the project proceeding."

The county will benefit directly from the development in the form of increased sales and property taxes, and indirectly from other developers planning to follow in Hawkins' footsteps. Largent said Moscow business owner Travis Wambeke - who plans to develop a 15-acre business park on Airport Road - indicated his decision to locate in the Moscow-Pullman corridor was influenced by Hawkins.

"I don't think Hawkins is the end of the story," Largent said. "We are excited about the economic development and other opportunities this will bring."

"IDWR: Intergovermental agreement needed for city to sell water to Hawkins"

Queen Nancy thinks "it'll be time-consuming." Of course she does.

From today's Moscow-Pullman Daily News:

Moscow and Whitman County will have to enter into an intergovernmental agreement if the city wants to provide water to the Hawkins Companies development.

Moscow City Supervisor Gary Riedner said Idaho Department of Water Resources officials told Moscow leaders last week that such an agreement will be required for the city to move forward with its application to modify Moscow's water service area to serve the Hawkins retail development just across the state line.

The city agreed to make "prompt application" to IDWR in a settlement with Hawkins, reached during closed-door mediation in February.

The process to create the intergovernmental agreement is just beginning, Riedner said. Moscow and Whitman County leaders have not been able to find a suitable date for an initial meeting.

Whitman County Public Works Director Mark Storey said he expects a meeting to occur within the next few weeks. It will then take a month or two for Moscow City Attorney Randy Fife, Whitman County Prosecutor Denis Tracy and other city and county officials to work out the agreement.

"I think the basic agreement's kind of simple," Storey said. "They agree to sell us water and we agree to pay for it, then we pass it on to Hawkins."

Riedner said intergovernmental agreements are fairly commonplace. The city and county already have mutual aid agreements for police and fire services in emergencies, for example.

IDWR Public Information Officer Bob McLaughlin said a 2005 letter to Fife from Deputy Idaho Attorney General Steve Strack explains the need for the intergovernmental agreement.

Strack wrote Idaho cities are authorized to enter joint service agreements "where it is more practical to construct and maintain a unified water or sewage system than for each city to provide separately such services to their respective residents." The municipalities' water rights would be amended to include the joint service area.

Strack wrote that similar agreements across state lines are potentially available under a section of Idaho Code that authorizes Idaho public agencies to "enter into cooperative agreements" with out-of-state public entities. Any agreement to extend services across state lines "would have to be carefully crafted to address issues such as authority to levy and collect taxes and fees."

The letter includes other rules and regulations regarding out-of-state water use and delivering water across state lines.

McLaughlin said he could not comment on the Hawkins situation aside from referring to the Strack letter, which was written in response to a separate inquiry from Fife.

Riedner said at Monday's City Council meeting that the city will see if it can send a letter to IDWR stating the city and county are pursuing the agreement, and move forward with the application while the agreement is being finalized.

The Moscow City Council and Whitman County commissioners will discuss and vote on any agreement publicly. Riedner said Hawkins officials also will review the agreement.

Moscow Mayor Nancy Chaney said the city will make an effort to move expediently on the agreement, as stated in the settlement with Hawkins, but it may not be easy.

"I think it'll be time-consuming," she said.

"County will seek state grant to pay off Hawkins bonds"

If the state covers the infrastructure costs for the Hawkins development, all the bitching and moaning about "subsidies" and "costing taxpayers" will dry up and blow away. However, the most important part of this story is buried at the end:

Commissioner Jerry Finch said Hawkins expects to begin moving dirt in June.

From last Thursday's Whitman County Gazette:

County officials want the state to pay for the infrastructure improvements at the Boise-based Hawkins Companies’ stateline strip mall.

Whitman County was one of 18 entities throughout the state to survive the pre-application process for a Local Infrastructure Financing Tool (LIFT). LIFT funds are administered by a special board through the state’s Community Economic Revitalization Board (CERB).

Commissioner Greg Partch briefed county staff on the process in a workshop session Monday afternoon in the commissioners’ conference room.

“We have a real opportunity here,” said Partch. “From the questions I’ve asked, we do qualify for this.”

Commissioners in February approved a preliminary development agreement to bond more than $9 million of county funds for infrastructure improvements at the Hawkins site.

The LIFT board grants funding to pay off bonds for projects that will best generate tax revenue from private investments. To fund the grants, the state discounts its share of local sales tax revenues.

According to Partch, the state recoups its investment by an increased generation of its share of tax revenues from the development.

Partch also noted the board looks to spread funding across the state, and has not made any investments in southeastern Washington.

Major projects were funded completely by the LIFT board this year in Bothell, Vancouver and Liberty Lake. The board is allotted $2.5 million from the legislature every year to award to communities on a competitive basis.

To qualify for the funding, the county must form a Revenue Development Area. Formation of such a district requires commissioners’ approval and a public hearing.

The county would seek $1 million a year from the program for at least the next 14 years. That money would be used to pay off bonds the county is set to issue to finance infrastructure at the shopping center.

Partch said the remaining $5 million over the bond amount would cover bond interest and consultant fees for the firm that puts the bond package together.

An offset of local sales tax revenues generated from the center has been projected as the county’s approach to paying off the bonds. A grant from the state fund would mean the local sales tax revenue would go into normal county accounts rather than the Hawkins bond redemption fund.

Partch also mentioned the possibility of drawing $1 million a year for the next 25 years to lay pipe through the corridor and upgrade the Pullman Airport Road to accommodate increased traffic.

“That road will feed the back side of WSU even more if there’s businesses out there,” said Finch.

Storey said traffic on the Pullman Airport Road has risen significantly since a light was installed by the state at the eastern intersection with the recently widened State Route 270. A county traffic count from last fall showed 6,000 cars use that intersection each day.

Partch noted the extra money could also be used to lay pipe to provide water and sewage to new businesses in the corridor.

“Although they’d be empty, we’d have the infrastructure for development,” he said.

Commissioner Mike Largent thought it might be better, however, to focus the application on the Hawkins infrastructure.

“Going beyond Hawkins in the application might hurt us,” he said. “Because there’s no clearly defined projects in the rest of the corridor, and there’s no water.”

“The Hawkins project is so thoroughly designed, we should score high,” Assessor Joe Reynolds commented.

Largent added he would like to hear from previous LIFT grant recipients on what hoops they were forced to jump through after receiving the grant.

“More than anything I want Hawkins,” added Largent.

Partch suggested submitting two applications; one to cover the costs of the Hawkins infrastructure alone, and one to fund the pipes and road work.

He added the state would provide a consultant to help the county make its application more appealing to the LIFT board. If the county opts to proceed past that, it will likely hire a professional consultant to fully put the application together.

Partch added the county could use some of the information in the Port of Whitman County’s Innovation Partnership Zone application to further develop its application.

The port and county last year shared the $25,000 cost for Mindshare Consultants of Spokane to develop the Innovation Zone application packet.

The application is due June 30, and CERB decision will be announced Sept. 18. That timing could coincide with the county’s bond issuance. Bonds must be taken out by the county within three months of the start of construction. Commissioner Jerry Finch said Hawkins expects to begin moving dirt in June.

"Wal-Mart rumors just that - for now; Company official won't confirm or deny site being considered in proposed Hawkins development"

I have several comments on this article from today's Moscow-Pullman Daily News:

1. This rumor is as old as a brontosaurus. It has been around at least as long as Wal-Mart dropped its plans to go into Moscow some two years ago. It must be a slow news week to dredge this story up now with no new information.

2. There is no reason to think that Wal-Mart will pull out of Pullman at this juncture. They have invested quite a bit in legal and engineering expenses, and don't forget, they own the land on Bishop Blvd., paying $1.4 million for it back in April 2006.

3. A sound economic case can be made for having a Wal-Mart at Hawkins and in Pullman. As I demonstrated with Reilly's Law of Retail Gravitation, there are two distinct Pullman and Moscow Retail Trade Areas. The Hawkins development will be located 2 miles within the Moscow Retrail Trade Area.

4. Hawkins would likely have to redo its site plan to accomodate a Wal-Mart Supercenter. The current plans call for three big-box stores around 160,000 sq. ft. Wal-Mart Supercenters are generally around 200,000 sq. ft. Parking would probably need to be increased as well.

5. Once again, I state that all the opposition to Hawkins from the City of Moscow and Mark Solomon has been due to this rumor and Wal-Mart Derangement Syndrome. The NoSuperWalMart group of which Solomon is a key player and which includes several key Chaney political allies, released a flyer in September 2006 called "Closing the Gaps," which stated:

Thanks to an energized Moscow community and a City Council with the strength to say “NO” to a bad development proposal, Wal-Mart was shut down in their attempt to build a SuperCenter in town. But weʼre not totally in the clear, yet.

There are two other possibilities for siting a SuperCenter close to Moscow. One is in the county immediately outside the city limits called the Area of City Impact. The other is across the state line along the Pullman Highway.

Unfortunately for NoSuperWalMart, they lost both those battles. Latah County refused to institute a big-box ordinance in the Area of City Impact and now Moscow has dropped its water rights transfers appeals against Hawkins.

6. No matter what happens, it seems likely the old Wal-Mart in Moscow is destined to close if a new store opens. You can tell from what the Wal-Mart spokeswoman says that Wal-Mart does not like to operate in those smaller formats. All the PARD arguments about "One Wal-Mart is Enough" are preposterous. But don't worry, all the current Wal-Mart employees will be offered positions at whereever a new Supercenter opens.

7. Despite PARD's insistence that there is only a "small, vocal minority" that wants Wal-Mart in Pullman, it is evident from this story that idea is completely false. And those people are getting impatient. I am just one of many. I have no idea who Joann Haynes is. But I hear all the time from people who want Wal-Mart, NOW.

8. Similarly, despite PARD claims that I am the "Wal-Mart surrogate." the "avid Wal-Mart groupie," or a paid shill, I have no special insights or lines of communication to the company. I know as much as you do from reading the paper. I just pray Wal-Mart sticks it out and doesn't lose interest in Pullman.

Joann Haynes has heard the rumors about Wal-Mart.

The Pullman resident said she's heard through the grapevine that the Moscow store is slated to close and be replaced by a Wal-Mart Supercenter in the Hawkins Companies' proposed retail development in Whitman County.

Furthermore, Haynes said she's heard that if the plan gets the OK, Wal-Mart officials would scrap the project to locate in Pullman, as the county location could be shared by customers throughout the area.

Karianne Fallow, Idaho Wal-Mart public affairs manager, said there's no truth to the rumor - yet.

Fallow said the Moscow store will continue to operate as usual, but added that Wal-Mart officials have been interested in opening a super center in the city for several years.

In May 2006, the Moscow City Council denied a rezone that would have allowed the retail giant to pursue construction of a store on 77 acres east of town. The larger store would provide merchandise and groceries - a one-stop shopping experience Fallow said customers want.

"The modern Wal-Mart customer prefers the convenience of general merchandise paired with grocery," she said. "Our goal would be to serve our customers in Moscow with a super center. We don't have any plans to close (the current store) right now ... but the property where we exist is too restrained to do an expansion."

Since the rezone was denied, Fallow said store officials have kept an eye out for land that could accommodate a bigger store. The company is aware of the proposed Hawkins development, but Fallow would not confirm or deny whether store officials are negotiating to relocate there.

"We're always looking at any properties for opportunity," she said. "At this point, I can't confirm that because we don't have land under contract now ... But any opportunity would be a good opportunity for us to consider."

Jennifer Holder, Wal-Mart public affairs manager for Washington, said she also is aware of the rumor, but to her knowledge the rumblings are unfounded.

She said any strategy to relocate or expand the Moscow store wouldn't affect plans to construct a Wal-Mart Supercenter on Bishop Boulevard in Pullman.

"Moscow is a completely different market," she said.

Holder said store officials still are waiting for a court decision before breaking ground in Pullman. Wal-Mart announced plans to build in Pullman in October 2004 and a site plan for the store was later approved by the city.

The grass-roots Pullman Alliance for Responsible Development later appealed the approval of the corporation's environmental checklist and site plan on the grounds the store would affect stormwater run-off, traffic and negatively affect Pullman's local economy.

The case is being considered by the Washington State Division III Court of Appeals in Spokane. Holder said a decision is expected by June.

"We have no plans - no activities - until that decision is handed down," she said. "I know there are a lot of people anxious about it. I've even gotten calls from elected officials who have asked, 'When are you going to break ground?' ... We're waiting like everyone else."

Haynes said she is a supporter of a store being constructed in Pullman and is distressed by the rumor, so much that she admits to spreading it in an effort to determine whether if it's true or not.

"I really still want to see Wal-Mart in Pullman," she said. "If it was out there (in the county) it would still mean I have to buy more gas and get out on the highway with the ice and snow."

Angela Grant hadn't heard the rumor, but said she wouldn't be surprised if it was true.

"With a big new development there, they might look at that spot," said the Moscow resident and co-owner of Lilliput.

Grant said she does shop at Wal-Mart occasionally, and added that if the store were to relocate in Whitman County she'd do what she could to keep her dollars in Idaho by purchasing items at other stores, such as WinCo.

"If we're going to be buying the same products, we may as well stay local," she said. "I try to find as much stuff as I can (elsewhere in town) so I don't have to go to Wal-Mart."

Haynes said she's relieved to hear Wal-Mart still intends to build in Pullman, but she's ready to start filling her cart now.

"If that's the case, that's good, but it's sure taking its time," she said. "We're supposed to be shopping there right now."

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"Legal arguments linger over Hawkins water sale; Lamar questions whether IDWR will approve extension"

I'm glad someone on the Moscow City Council realizes the hypocrisy that was involved with Moscow obtaining a water right to drill a new well while opposing the Hawkins Companies attempting to do the same thing.

From yesterday's Moscow-Pullman Daily News:

Moscow City Councilman Tom Lamar suspects the Idaho Department of Water Resources may deny the city's application to extend its water service area into Whitman County.

Lamar was the lone council member to vote against accepting Public Works Director Les MacDonald's report about the application at Monday's City Council meeting. The city seeks to provide water for the Hawkins Companies' proposed retail development on the Pullman-Moscow Highway, just across the state line.

"I guess I still haven't acquired any additional comfort in doing that, so I just wanted to state my continued concern for this process," Lamar said.

The city agreed to make "prompt application" to IDWR in a settlement with Hawkins, reached during closed-door mediation in February. MacDonald will send a copy of the application to Hawkins for review before it is sent to IDWR.

City Supervisor Gary Riedner said the city will notify the public when the application is sent to IDWR.

The application requests a modification of the city's service area, which usually is the same as the city's corporate limits. The application states the water will be supplied to Whitman County for use by "a commercial development located immediately adjacent to but outside of the city's corporate limits."

MacDonald said the application would not modify Moscow's water rights in any way other than extending services. It does not ask for additional water rights, surrender any rights or make other changes to current services.

Lamar said after the meeting he has doubts there is room in Idaho law for selling water across state lines. He does not know of any example where it was allowed.

He also is concerned that the request could be seen as water mining, which is illegal in Idaho.

"We're taking water out faster than it's being recharged, and now we're going to sell it as a commodity," he said.

City Attorney Randy Fife said he sees no legal problem with Moscow's request "because the Idaho state code provides a mechanism to deliver water outside of the state, and because IDWR agrees that that is an appropriate mechanism."

Fife said IDWR officials want the city to enter a joint powers agreement with a Washington political entity, likely Whitman County, to extend the water service area.

He said he would prefer the city and county reach an agreement before the application is sent to IDWR.

Mayor Nancy Chaney, who does not support selling water to Hawkins, said there should be more communication between the parties involved in the settlement agreement "to ascertain whether being fast or being thorough is preferable" before the application is submitted.

Councilman Walter Steed reminded the council that Hawkins still would have access to 45 acre-feet of water rights should the application be denied.

"Once this is approved and we are able to physically supply water then they are to abandon those water rights and they will be given back to the state of Washington and not be used," he said.

In other business:

MacDonald reported on the city's preparations for Well No. 10, which is scheduled to be drilled on the west end of A Street in 2009.

The city will apply to IDWR to utilize Well No. 9's existing water right for the new well. The amount of water the city can pump will not be increased, but it will be able to pump from either Well No. 9 or Well No. 10. Riedner said the purpose of Well No. 10 is to provide backup in case Well No. 9 temporarily shuts down.

MacDonald said at an earlier meeting he would prefer to apply for a new water right. Councilman John Weber agreed, and voted against accepting the report on the application.

Weber said after the meeting it seems like a waste of time and money to drill a new well but not obtain a new water right.

Steed and Councilman Wayne Krauss said Moscow should not apply for a new right just after asking Hawkins Companies to relinquish its water rights in exchange for the water sale.

"Architect projects costs to renovate, replace Pullman High School"

Pay close attention to this line in the story below: "funding will become easier as property valuations in Pullman increase."

Both the Pullman Wal-Mart Supercenter and the Hawkins development in the corridor will be in the PSD #267 taxing district.

Wal-Mart's property, valued at $22,784,646, will pay $112,784 in taxes to the Pullman School District every year.

The Hawkins development, at 40% buildout, is valued at $50,000,000, and will pay$247,500 in taxes to the Pullman School District every year. As it is further built out, it will be worth more and pay more in taxes.

That's an additional $72,784,646 in property valuation added to the tax rolls, bringing in an extra $360,284 a year to our schools.

As a homeowner and the parent of a preschooler who may very well benefit from a new Pullman High School, you can see why I am supporting Wal-Mart and Hawkins versus sending my dollars to the Idaho school system.

From yesterday's Moscow-Pullman Daily News:

It will cost more than $55 million to renovate or replace Pullman High School, according to projections from a Spokane-based architect.

Steven J. McNutt provided his estimates during Wednesday's Pullman School Board meeting, leaving board members to mull their options for the high school's future.

Renovating the existing 37-year-old building would cost about $55.5 million, while building a new, 140,000-square-foot facility would cost more than $58 million. The projections are based on estimated 2009 construction costs. The state would pay about $10.5 million, and the Pullman School District would be responsible for the rest.

"I apologize for the sticker shock. These prices are crazy," McNutt said. "It's a perfect storm of commodity increases and a red-hot market. Contractors have more projects than they can build."

Such an expense would be difficult for the district considering it is paying off $23.4 million in debt for renovations of Lincoln Middle School and its three elementary schools. At present, the district can only take on $42.2 million in debt based on the total valuation of property in Pullman.

The district is paying off about $1 million in debt every year, and Executive Director for Support Services Dan Hornfelt said funding will become easier as property valuations in Pullman increase.

McNutt has worked on about 100 schools in eastern Washington, including Lincoln Middle School. He talked about the advantages and disadvantages of rebuilding versus renovating, adding a state-of-the-art theater, keeping the gymnasium and shop at the existing school, and the timing of the project.

McNutt also said the district needs a school of about 165,000 square feet. The existing school is 159,220 square feet, but space is inefficiently utilized. He described the school as having "a meandering plan, a peculiar footprint."

McNutt's estimates include about $557,270 for asbestos removal and $500,000 for temporary buildings if the district decides to renovate the school. He also said most new schools have theaters with catwalks, acoustic tile, an orchestra, fancy seating and curtains.

Pullman Superintendent Paul Sturm said he heard many questions from voters about the high school as he spoke to community groups regarding the recently approved maintenance and operations replacement levy.

McNutt told the board he thinks the district should wait to proceed "until it's financially viable," but Sturm said the school has some infrastructure needs that can't wait six years.

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Retail Gravity on the Palouse

I have shown how Hotelling's Model explains why retail stores tend to agglomerate in the center. This is, admittedly, a very simplistic explanation.

University of Texas economist William J. Reilly studied the purchases made by the residents of the various counties in Texas. Reilly knew that generally the farther away two counties were from each other the fewer transactions would take place between them. On the other hand if a county had a big city with a lot of bigger retail stores it would act as a magnet attracting the shopping by residents of surrounding and even distant counties. Also a county that had a larger number of residents would have more transactions with a given county than one with a smaller number of residents. Using this data, Reilly published a book in 1931 titled Reilly's Law of Retail Gravitation. In the book, Reilly postulated that two cities of equal size have a trade area boundary midway between the two cities. When cities are of unequal size, the boundary lies closer to the smaller city, giving the larger city a larger trade area.

Reilly's Law calculates a point of indifference (where consumers are indifferent as to which location they use) between two towns in order to determine the retail trade area of each city. Reilly called the boundary between two trade areas the breaking point. On that line, exactly half the population shops at either of the two cities. Obvously, if you were planing on serving both trade areas, you would want to locate as close to this line as possible.

This break point (BP) is equal to the distance (Dab) between the two cities, divided by the following: Unity or total (1) plus the square root of, the population of City A (Pa) divided by the size of City B (Pb). If you have studied physics, you realize this is quite similar to Newton's Law of Gravitation, which states that two bodies attract each other with a force that is proportional to the product of their masses and inversely proportional to the square of the distance between them

According to the Hotelling Model, the break point should be halfway in between Moscow and Pullman at around 4.65 miles from Pullman. However, since Pullman has a larger population, it is assumed that it will draw more customers. Using the 2005 Census population estimates for Pullman and Moscow and the distance between the center of each city, the break point according to Reilly's Law is 4.8 miles away from Pullman (see chart above). This in part explains why the center of retail gravity on the Palouse is shifted in Moscow's direction. And if Pullman grows more than Moscow, as anticpated, the center will shift even further towards Moscow.


Plotting this out on a map, the theoretical break point between Pullman (A) and Moscow (B) would be approximately at the intersection of SR 270 and Sunshine Road (C). The Hawkins development (D) is two miles to the east of this point.

One of the problems with Reilly's Law is that is not constant for all shopping trips. Retailers can offer additional competitive advantages and this can change the attractiveness of a location. In order to overcome these limitations, several refinements have been made to Reilly's Law. One of these was "Huff's Law of Shopper Attraction." Huff's Law describes retail trade areas on the basis of the size of the store (product assortment), distance, and the sensitivity to travel time associated with the type of product being sought.

The probability of a consumer traveling from home to shopping location A is equal to the square footage of selling space in location A divided by the travel from consumer's home to shopping location A divided by the sum of the square footage of selling space in all different shopping locations (A, B, C...) divided by travel time.

So let's look at the location desirability of Hawkins alone at the SR270/Sunshine Road location versus the desirability of the Hawkins/WarBonnet Plaza/Palouse Mall agglomeration, which was created by land use restrictions in the corridor.

For these calculations, the travel time to the SR270/Sunshine Road location from Pullman is 7 minutes. The travel time to the Hawkins/WarBonnet Plaza/Palouse Mall agglomeration is 11 minutes. Square footage at the SR270/Sunshine Road location is 740,000. Square footage of the Hawkins/WarBonnet Plaza/Palouse Mall agglomeration is roughly 1.32 million.


In this case, even though travel time to the Hawkins/WarBonnet Plaza/Palouse Mall agglomeration is 4 minutes longer, consumers are 6.4% more likely to shop there versus a SR270/Sunshine Road with Hawkins alone.

Hawkins knows all these things already, and that is why they chose the location that they did. It is based on economic science and not any desire to "screw over" Pullman.

Hotelling and Hawkins

In his Town Crier column last Wednesday, Chris Lupke wrote that:

A mall on the Idaho border with no promise of tax revenue won't help our parks or police and won't pave our streets. But what it will do is permanently situate the retail center in and near Moscow, miles from Pullman. Better negotiators could have insisted it be sited closer to our retail base.

Lu Laoshi may be a "national expert" in Chinese and Chinese culture, but he doesn't know jack about the economics of retail.

Some 80 years ago, economist Harold Hotelling devised an analogy to explain the spatial functioning of the marketplace.

His analogy became known as "Hotelling's Model":


Suppose there is a beach which is 100 yards long. Assume beachgoers are spread evenly across the length of the beach. Along come two ice cream vendors. The vendors are selling product of similar quality and price (ceteris paribus.) Logically, the layman would expect the vendors to place their carts at the 25 and 75 yard lines of the beach, thus allowing for an equal division of profits and providing the greatest convenience to beachgoers, as no one would be more than 25 yards from an ice cream cart.

However, one vendor will recognize that by relocating closer to the midpoint of the beach he can achieve an increase in market share. So, on the illustration above, the vendor at Position A will move his cart to the 30 yard line, increasing his market share to 52 1/2 %. The vendor at Position C will compensate by moving his cart to the 70 yard line. This continues as both vendors move incrementally towards the middle of the beach. Eventually, both vendors' carts are at Position B, right next to each other. They have achieved economic equilibrium, with each having a 50% market share.

Hotelling's Model, as you might guess, is very sensitive to cost assumption. There must be some cost to traveling because customers prefer the closest vendor. But these costs must be small, because the people at the end of the beach continue to buy the same amount no matter how far they are from the nearest vendor. If traveling costs are less, then people might not care whether they go to the nearest vendor. If they are greater, so that when the vendor gets far away, people do not bother to go, the vendors will no longer cluster at the middle.

Pullman residents, being six miles away from Hawkins, have negligible traveling costs. Travel costs for Moscow residents are even less. Put the shop in the middle, the customers will come, especially if there is already other retail clustered there. That explains why Hawkins chose the location it did. All very logical and very much in accord with economic principles. That is why the Pullman/Moscow corridor is a potential gold mine.

My Response to Chris Lupke

I'm sure some of you were wondering if I would respond to Loopy Lupke's latest Town Crier column with its embarassing hypocrisy and tortured circular logic concerning the Hawkins development. Well, I did, and here it is from today's Moscow-Pullman Daily News

Columnist changes stance

In a 2006 Daily News op-ed, Chris Lupke wrote that, "Wal-Mart and its surrogates have tried to pit Pullman and Moscow against each other in a 'divide and conquer strategy,' arguing a dollar spent in Pullman would have the 'added benefit' of not going to Moscow ... We should be thinking of ways in which growth in Pullman also can benefit Moscow and vice versa ..."

And yet, in his latest Town Crier column (Opinion, 3.5), Lupke does a volte-face, fretting about sales leakage and claiming the Hawkins "boondoggle" will "permanently situate the retail center in and near Moscow, miles from Pullman" and not "closer to our retail base." Incidentally, Pullman schools will benefit from taxes paid by Hawkins. City residents utilize county parks, roads, and law enforcement and emergency services that stand to gain as well. Pullman is, after all, part of Whitman County. Those taxes also will help pay Professor Lupke's salary.

The Pullman Alliance for Responsible Development's position paper on Wal-Mart states that, "While we understand some people in Pullman who think it only fair turnabout to gain sales at the expense of Moscow at a time when the Pullman and Moscow governments are seeking to cooperate on a number of projects, including responsible development of the Route 270 corridor, this is no time for store wars to ruin good will."

Indeed. By PARD's standards, the Hawkins development is highly responsible, as it will be situated on the largest highway in the region far away from any hospitals, schools, retirement homes or cemeteries. Distance certainly can't be an issue either, as PARD member T.V. Reed has publicly offered to drive folks over to Moscow to shop. Plus, as PARD has repeatedly assured us, they are not against all large retail stores, just Wal-Mart.

We can only hope Target or Costco soon announce plans to locate in the Hawkins development.

Tom Forbes, Pullman

If Lupke and PARD wanted to covince everyone they were not against retail and not just Wal-Mart, this column was very ill-advised. But of course, they are against national retail stores. They are liberal fascists just like Chuck Pezeshki. As the late Don Pelton used to point out, the PARDners long for an economic model and lifestyle that disappeared in the 1920s, which is fine in itself, except they demand the government mandate it through land use regulations.

And inevitably, the "constructive community dialogue" the Daily News thinks is is fostering with the online comments just leads to more irresponsible lies from anonymous idiots like this:

Also, as I understand it, there won't be any tax benefits for anybody except the holders of the bonds Whitman County wants to saddle residents with for the next 20 years.

You understand nothing. First, as has been stated before repeatedly here and elsewhere, THERE WILL BE NO TAX LIABILITY TO THE CITIZENS OF WHITMAN COUNTY. The $10.5 million infrastructure bond will be paid off with the retail sales tax proceeds. And as far as tax benefits go, how about:

$4,207,500 for the Pullman School Distict over the next 20 years
$2,174,001 for Whitcom emergency communications over the next 20 years
$2,050,115 for Washington State schools over the next 20 years
$1,190,000 for Rural Fire District 12 over the next 20 years
$421,005 for Whitman County libraries over the next 20 years
$350,370 for the Port of Whitman County over the next 20 years

And that's just from property taxes, which are the same regardless of how much business the mall does. So let's hear some alternatives from our local leftists on what they believe could raise that much money.

Why exactly do people like Lupke think the Hawkins project is bad if it won't benefit Pullman (it will)? Would it be the end of the world if some of the smaller towns like Palouse, Colton, and Garfield in Whitman County benefit (they will also) for a change? How selfish and short-sighted. We're all in this together.

"Panel OKs rezone for business park; County commissioners will have final say"

I love this story because it skewers three myths all at once:

1. Big-box stores don't attract small business. STRATA will be located adjacent to the Hawkins development.
2. If we develop retail in the corridor, there will be no room for high-tech businesses that pay living wage jobs.
3. Moscow's "smart growth" policies haven't chased away business.

From yesterday's Moscow-Pullman Daily News:

The Whitman County Planning Commission recently approved the rezoning of 15 acres deemed critical to a proposed business park on Airport Road.

The commission's recommendation will be forwarded to Whitman County commissioners, who have the final say in the rezone.

The rezone was proposed by Moscow resident and business owner Travis Wambeke. If approved, it will change the designated use of the property - located at the northwest corner of Airport Road and O'Donnell Road, just east of the Pullman-Moscow Regional Airport - from agriculture to heavy industrial.

Assistant County Planner Alan Thomson said the current outline presented to the county calls for the creation of three 5-acre parcels that will be leased to construction-related businesses involved in engineering and other geotechnical work.

Thompson said Wambeke also plans to relocate his company, STRATA, to the business park. The business currently operates in Moscow.

County Commissioner Jerry Finch was not familiar with details of the proposal, but said - as always - he would welcome growth to the corridor.

"Obviously anything we can do out in the county to further economic growth we are happy about," Finch said. "It brings an opportunity to bring jobs into the county and that was our goal when we came in eight years ago."

Thomson said only a few residents showed up to the rezone hearing Wednesday and all said they supported the development. However, one resident voiced concerns over increased traffic on Airport Road and the compatibility of the business parks and nearby homes.

Thomson said traffic increases caused by the park would be minimal and the county's comprehensive plan allows for the rezone.

Planning commission member Guy Williams said the rezone met all of the county's criteria and he is "looking forward to it moving ahead."

Finch said the proposal provides just another indication that Whitman County has shed some of its stereotypes.

"We used to have a reputation of being anti-growth," Finch said. "Well, I think we've changed that and we are starting to reap the rewards."

Finch said the proposed business park likely will be one of many developments in the corridor.

"I think long-term right out along Airport Road will be a great commercial" and industrial area, Finch said.

Wambeke could not be reached for comment.

Thomson said commissioners are likely to make a decision on the rezone later this month.