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In Derby: New Walmart could add 218 jobs

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An architect’s rendering of the front of Derby’s new Walmart gives an idea of the range of merchandise the new store will offer.
An architect’s rendering of the front of Derby’s new Walmart gives an idea of the range of merchandise the new store will offer.

copyright the Chronicle May 28, 2014

by Joseph Gresser

DERBY — A new Walmart Supercenter could add 218 jobs and $4.7-million to area payrolls, according to an economic analysis submitted with permit applications on May 22. If the permitting process hits no snags, the new store could open by late fall of 2015.

The project will increase traffic on Route 5 by more than a third and could require at least two sets of new traffic signals on the Newport-Derby Road.

According to the permit documents submitted to the Derby Zoning Administrator and the District #7 Environmental Commission, the Walmart will likely include a grocery store, pharmacy, and auto center. It’s to be built between Route 5 and Shattuck Hill Road by Shattuck Hill Investments, LLC, a company owned by Burlington developer J.L. Davis.

Route 5 and Shattuck Hill Road would be connected by a wide boulevard opening on to Walmart’s 657-car parking lot, according to the site plans.

Mr. Davis has built other Walmarts in Vermont, including the one at Tafts Corners in Williston and the recently opened St. Albans store.

The permit application was accompanied by a series of drawings showing details of construction, including how storm water runoff will be handled. It also includes traffic and economic impact studies commissioned by Shattuck Hill Investments.

The economic impact study, written by Richard Heaps and Arthur Woolf of Northern Economic Consulting, Inc., predicts the new store will add 218 Orleans County jobs and bring 35 new residents in 15 new households to the Derby area. The report also predicts seven of the new households will be located in Derby and two in Newport with the rest in other towns.

While the authors of the report say they do not have access to internal information from Walmart, they add that the new store should add $4.7-million in net salaries to the economy of Orleans County.

The construction phase of the project is expected to employ 95 people, the report says.

It says Derby will see only a small net gain to its tax revenues. While the authors estimate the new store’s property tax bill at approximately $60,000, it suggests the 194 Derby residents who are expected to work at the Walmart will cost nearly that much in town services.

Taking into account the taxes and expenses allocated to seven new homes the report predicts will be built in Derby as a result of the new store, Mr. Heaps and Mr. Woolf say the town coffers will benefit by about $3,000 annually.

They say Newport will see a cost to city taxpayers of about $834 in the first year of the store’s operation. Newport, though, has signed an agreement with Mr. Davis that will provide the city with annual payments of $100,000 in each of the first six years of the store’s operation.

Direct costs to Derby from the operation of the store, such as increased wear and tear on town streets, or added policing, are not included in the report.

Because so few new people will move to the area, and because the school-age population has been declining in recent years, the report says the new store will have a negligible effect on the cost of schooling.

It says the new Walmart will have the biggest impact on competing grocery stores in Newport and Derby. Both Shaw’s and Price Chopper are big corporations that have learned to compete with Walmart, generally by cutting prices, so shoppers are likely to see a decrease in grocery costs ranging from 5 to 25 percent.

The grocery stores that do compete with Walmart are likely to shed about 87 jobs, according to the report.

With increased distance from Derby, the influence of Walmart’s lower grocery prices will be balanced by the convenience of being able to shop without having to travel. Groceries in Orleans and Barton, for example, will not suffer ill effects from the new Supercenter, the analysis says.

It says that other businesses most likely to feel the effect of Walmart’s competition are dollar stores. But they, too, are used to operating in areas that host a Walmart and should not suffer too many ill effects.

Another of type of business that might be affected by the coming of a Walmart would be a competing discount store. Since Ames closed in 2002, the report notes, there has been no such discount store in the area.

Since Ames closed, many Orleans County residents have traveled to Littleton, New Hampshire, to shop at the Walmart there. Local business owners hope more of the money those shoppers take out of the area will stay closer to home once the Walmart is opened. The report does not address that issue directly, stressing only the benefits of lower-priced merchandise and more jobs in Orleans County.

It does discuss the question of secondary growth — businesses that often open near a Walmart to take advantage of the traffic generated by the big box store. According to rules adopted by the state Environmental Board, secondary growth means “highway-oriented” businesses.

That, the report says, generally means fast food establishments, gas stations, and banks with drive through windows. Because there are a number of such businesses in the immediate area, the report concludes the new Walmart will not spur secondary growth.

Nevertheless, one new business of the sort included under the category of “secondary growth,” a CVS Pharmacy, is under construction at the corner of Shattuck Hill Road and Route 5, and another, a Dunkin’ Donuts store, has applied for a permit to build between the CVS and Modern Furniture on Route 5.

The authors of the report also note that Mr. Davis owns six lots that directly border the proposed Walmart, and they are prime spots for other stores or restaurants hoping to capture some of the Walmart shoppers.

There will probably be a lot of those shoppers. According to a traffic study commissioned from Conley Associates by Shattuck Hill Investments, the new store should result in an additional 6,000 weekday trips on Route 5 and Shattuck Hill Road.

Currently, the report says, Route 5 has a weekday traffic volume of 15,100 vehicles. The report recommends new traffic signals at the intersection with the northbound lane of Interstate 91 and at the boulevard connecting Shattuck Hill Road and Route 5.

There are also plans to reconfigure the intersection of Route 5 and Route 105 in Derby, possibly requiring all vehicles to stop before proceeding or turning.

The formal request for town and Act 250 permits came almost nine years after Mr. Davis first approached Derby officials to get a water allocation for a big box store.

While other proposed Vermont Walmarts, notably the St. Albans store, were held up by legal challenges and local opposition, the nearly ten years of hesitation in Derby were due to internal considerations on the part of the Arkansas-based retailer.

Mr. Davis, who has around a million dollars invested in the 17.6-acre parcel on which the store is to be built, worked hard to assure Walmart there would be no impediments to the project. He worked with municipal officials in Derby and Newport to get measures on Town Meeting ballots designed to show support for the project.

Both passed with overwhelming support. The Newport ballot measure included the promise that Walmart would give Newport $600,000 to mitigate costs, such as road improvements that will have to be borne by the city.

Mr. Davis also negotiated an agreement with two nonprofits that might have helped organize resistance to the store — the Preservation Trust of Vermont (PTV) and the Vermont Natural Resources Council (VNRC). Both organizations pledged not to oppose the Derby store and, in exchange, Mr. Davis promised not to build any new stores in Vermont for seven years, unless they are located in a downtown area.

Mr. Davis also agreed to design the Derby store, and any other businesses built on adjoining lots, so as to produce less storm water runoff than the property would shed without the buildings. If Mr. Davis gets his permits within 15 months, he will also donate $200,000 to the PTV for use in downtown and village projects in Orleans County. The money is to be paid within a month of the opening of the Derby Walmart.

contact Joseph Gresser at [email protected]

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