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Costco gains Planning and Zoning approval

BAXTER — Costco was the sole topic for the Baxter Planning and Zoning Commission meeting Thursday night, gaining recommendations for approval on all counts.

Staff and the commission recommended the developer’s request for a conditional use permit to allow the planned unit development. The commission’s recommendations now go before the Baxter City Council for a decision.

Ted Johnson, president of Illinois-based Design Strategies, represented Costco Wholesale as Midwest development director. Most of the conditional use permit requests were approved for recommendation by the commission without any dissent with one exception.

The commission voted unanimously to recommend approval for the minor subdivision plat, a conditional use permit for the planned unit development so the land may be re-platted to allow the 143,698 square foot wholesale building, a fueling station, and five outlots. Four of the outlots will be able to be developed for commercial businesses and one is designed to be used for stormwater management. Other recommendations for approval were granted for two monument signs, the tire installation and repair center and off-sale liquor store.

The sticking point in the conditional use permit requests came from an outdoor display request by Costco.

Costco has planned 731 parking stalls with the store development, which is not expected to open before the fall of 2012. The city requires 575 parking stalls for the development. Costco wanted to have an outside display option encompassing in 40 of its parking stalls and in the front of its main doors.

Costco proposed having Christmas trees available for 30 days and new vehicles there year-round. The vehicles are not actually sold on site. But Costco negotiates a deal with dealers to offer members a discounted price.

The city reported a concern with this outside display area as past approval to other businesses has required the outside sales and display to be related to the business’ principal use. Johnson said sales for the recreational vehicles and boasts would be limited to 10 days each, twice a year.

But Costco wanted to have the option to display the new automobiles, perhaps as many as eight at a time, in front of the store during warm, sunny days.

“We find it increases sales for the dealers that we are working with,” Johnson said.

Johnson said Costco’s auto sales program works with local dealers and one week may display a Chevrolet with a breakdown listing the savings. If the warehouse member wants to buy the vehicle, they contact the dealer.

“We have 60 million cardholders,” Johnson said, adding if a car has retail price of $40,000, as an example, a Costco member can get the car for $37,000.

Bob Kinzel, Planning and Zoning Commission chairman said he was concerned when he first learned of the request because it appeared to be something that hasn’t been available to other businesses.

Kinzel said if approved, he first thought this may open up a whole new area as the city has been restrictive to Mills Fleet Farm, Target and Walmart, in terms of display items.

“This is a whole different ball game,” Kinzel said. “This is a whole different approach from my perspective.”

While Costco doesn’t make money on the vehicle transactions, Gwen Carleton, commission member, noted the offering is part of the draw in selling membership cards.

Johnson agreed to a list of conditions, including an annual review of an interim use permit for the outdoor display area. The commission noted that annual review would give them the option to revisit the display if there was a negative reaction from the community.

“Costco is a very friendly neighbor,” Johnson said. “We want to be a good neighbor.”

Johnson said the city could limit the outdoor car display to six months. The commission approved the IUP for six months of the year, with Commission member Bob Ryan dissenting.

Commission member Steve Lund made the motion for approval, commending staff for the annual review idea.

“Because it is a hybrid and something we haven’t dealt with,” Lund said.

Ryan asked Lund to consider amending the motion to limit the display to local dealers or suppliers if legal counsel agreed. Without that, Ryan said a dealer from St. Cloud for example could come in and make sales when a taxpaying business was just down the road with the same merchandise.

“How are we going to deal with that?” Ryan said. “I don’t think we have an answer.”

Kinzel questioned whether the city could legally do that asking where free enterprise entered in to the mix. Ryan said free enterprise was still working but the city was not letting that other dealer come into the town. Johnson said he would be comfortable limiting it to within the Baxter Costco trade area but he noted people could access deals at as well.

Lund said he wasn’t comfortable making the change Ryan recommended. It would be different if it was a shoe store selling Jet Skis, Lund said, but the auto program is part of Costco’s business. Lund, who advocated buying locally, said it’s in Costco’s interest to have those relationships and he was comfortable with the annual review.

At the meeting, Kinzel said it was too bad there weren’t more people present as comments in the paper will come from people who don’t appreciate what it takes to put this agreement together. “Hopefully you’ve had a good experience from working with the city thus far,” Kinzel said.

Johnson replied there have been some issues but they’ve been able to work them out. “If there is a problem, there is a solution,” he said.

Costco is proposing to build on the vacant land, near the intersections of Highways 210 and 371 in Baxter, is across Elder Drive from Home Depot. The project already received approval from the Architectural Review Committee and that recommendation will go before the city council in December.

The land was previously home to the Park Region Timber Company, which later became Navillus Land Co., and more recently from 2000 to 2005 was home to Motor City.

RENEE RICHARDSON may be reached at or 855-5852.