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Cabela’s not fishing for tax subsidies to build its store

Sometimes, the power of the free market is just amazing.

You couldn’t help but feel it on Monday, in the wind-swept parking lot outside the shuttered Wegmans supermarket across the street from the Walden Galleria, as Cabela’s executives spelled out their plans for their first New York outdoors gear superstore.

Mark Nienhueser, Cabela’s vice president of construction and real estate, talked about how the hunting and fishing gear retailer had been poking around Western New York for four or five years, looking for a site that would be a great match for the chain’s push eastward. He talked about how Cabela’s thinks they found just that site, one that’s easy to get to because it’s just off the Thruway and near a regional mall that already is a powerful magnet for Canadians and shoppers from outside the Buffalo Niagara region.

And he talked about how Cabela’s already knows it has lots of Western New York customers from its online sales and visits to its 44 other stores, none of them less than a five-hour drive from Buffalo.

But what was truly striking was what Nienheuser wasn’t talking about: How thankful Cabela’s was for all the taxpayer help the retailer is getting to make the new store happen.

Because Cabela’s isn’t getting any.

In a region where doughnut shops and liquor stores line up for handouts like they’re an entitlement, Cabela’s – one of the nation’s most coveted retailers because of its ability to draw customers from far and wide – is doing the Cheektowaga store on its own. The retailer actually thinks it can make a good buck in the Buffalo Niagara region without asking taxpayers to toss them hundreds of thousands of dollars.

Imagine that.

The irony wasn’t lost on Cheektowaga Supervisor Mary Holtz, who also sits on the board of the Erie County Industrial Development Agency, which is the conduit for businesses in her town that seek the property, sales and mortgage tax breaks it offers.

Only the Erie County IDA, as a matter of policy, doesn’t give tax breaks to retail projects, unless they’re part of a major destination-type development, which Cabela’s is not.

“This is not something that should be subsidized,” Holtz said.

“Nobody even requested any, so nobody had to say no,” she said. “It shows what a great spot this is.”

If the Cabela’s site was in Amherst or Lancaster or Hamburg or Clarence, it’s a good bet that the retailer would be in line for some pretty lucrative tax breaks, because those communities have their own IDAs and have been much more willing to give incentives to retail projects. While all of the county’s IDAs operate under the same guidelines, the suburban agencies often make exceptions for retail projects in areas that are targeted for redevelopment and would take empty or tired-looking buildings and spruce them up.

The Cabela’s project would do just that, but the Erie County IDA doesn’t do retail projects, even when they’re breathing new life into old buildings – or in this case tearing down an empty supermarket and putting up a brand new 88,000-square-foot store in its place.

Yet Cabela’s still picked Cheektowaga.

“The power of this site stood on its own,” said Eric L. Recoon, vice president of development and leasing for Benderson Development, which bought the Cheektowaga site last year after a foreclosure and had been talking on and off with Cabela’s for the past year or two.

To be sure, the Cheektowaga store will be a baby Cabela’s of sorts, one of the smaller, “next generation” stores that the retailer now favors. The chain, which now has 44 stores, plans to open 16 more – all in the smaller format – over the next two years.

The smaller stores, designed to fit more easily in areas where other retailers are located, such as strip malls, are about half the size of its store in Hartford, Conn., and a third of the size of its massive store in Hamburg, Pa. The Bass Pro that once was pegged for Buffalo’s waterfront would have been at least a third bigger than the Cabela’s in Cheektowaga.

But smaller isn’t necessarily a bad thing. Cabela’s executives have said the sales and profit per square foot at the smaller stores have been averaging about 30 percent to 40 percent higher than at their bigger stores.

The irony also wasn’t lost on U.S. Rep. Brian Higgins, D-Buffalo. “Inevitably, you’ll compare Cabela’s commitment to Western New York with the nine-year pursuit of Bass Pro,” he said.

Higgins was the highest-ranking politician at Monday’s parking lot press conference. Holtz was No. 2, followed by members of the Cheektowaga Town Board. Not a single state official showed up for the announcement of Cabela’s first store in New York. Nobody from Erie County was there, either. Those events aren’t nearly as fun when you can’t take credit for anything or hand out taxpayer money.

Compare that with all the hoopla when Bass Pro, Cabela’s big rival and the nation’s other big outdoors superstore chain, said in 2004 that it was coming to town. Gov. George Pataki, in the waning days of his administration, even showed up for the announcement that Bass Pro would build a huge store on the Buffalo waterfront that hopefully would attract outdoor enthusiasts from hours away and be a catalyst for development.

Only Bass Pro, deep down, wasn’t so sure it could make a go of it on the waterfront, even with the massive subsidies that come with being a pioneering piece in a grand project. So Bass Pro dragged its heels for years, and as it hemmed and hawed, local officials finally had the epiphany that maybe, a big store wasn’t what you really want to build your waterfront development around.

But it took a put-up-or-shut-up ultimatum from Higgins before Bass Pro finally pulled the plug and freed the region to revamp its waterfront plans in a new – and better – direction.

“We were trying to shoehorn it in. It was too early,” Higgins said. “Each development site has its own maturation cycle. We will be able to attract Bass Pro-like retailers to the waterfront site in the next three to five years.”

Maybe by then, the waterfront will be such a bustling place that retailers will do what Cabela’s did, and ride into town on the power of the free market.