James Beaty: OPINION: Shops at McAlester drawing thousands of visitors

Sep. 17—The Shops at McAlester highway shopping center in McAlester is already drawing thousands of visitors, with a number of buildings still under construction or in the planning phase.

"During the month of August we had 90,000 visits," said city of McAlester Economic Development Director Adam White. "It's the top shopping center within 50 miles of McAlester."

The city of McAlester has benefitted in several ways from the addition of the Shops at McAlester center.

"About 150 people have been hired so far at pay higher than the average pay for Pittsburg County," White said. "That's a win for us."

That number is expected to increase as more businesses open at the site.

"Once all the buildings are open, we expect 200-plus jobs in the Shops," White said.

Among the next major grand openings will be the opening of the Chick-fil-A, expected in October, said White. He said the restaurant is creating about 40 jobs in McAlester. It's also expected to pull more traffic in from the highway that might have otherwise driven right through McAlester. When it opens, it will be the only Chick-fil-A along the highway between Muskogee and North Texas, White said.

Other businesses with construction underway at the site include Ollie's, which retails closeout merchandise and excessive inventory from other stores; Five Below, where most items are $5 or less, with a smaller amount of offerings ranging from $6 to $25. Construction on Jiffy Lube hit a bump due to supply side shortages, city officials said, but it's expected to move forward once the needed materials arrive.

McAlester Community Development Director Jayme Clifton said concrete should be poured soon for the pad that will house The Bank N.A.'s new Shops at McAlester location.

Five Below is nearly ready for a Certificate of Occupancy inspection by the city of McAlester, which must be passed before a building is certified as safe for people to occupy, she said.

Shops at McAlester is at the intersection of Fourteenth Street and U.S. Highway 69, also known as the George Nigh Expressway where the highway wends its way through McAlester. It's been opening in stages, with Starbucks the first business to open at the site in March, followed by Burkes Outlet, Hobby Lobby, T.J. Maxx, Ross and Rack Room shoes.

Plans for a multi-tenant building adjacent to Starbucks call for a Tropical Smoothie at 1,800 square feet and a 2,500-square-foot T-Mobile, with room for two additional tenants.

TIF AGREEMENT

After several false starts, the Shops at McAlester project took off after developer Burk Collins of Burk Collins & Co. became involved.

Collins agreed to build the highway shopping center at his own expense through a Tax Increment Financing agreement, known as a TIF, made with the McAlester City Council and the Pittsburg County commissioners.

The agreement called for Burke Collins & Company to get 90% of the city's and the county's portion of sales taxes from the site for five years or until he receives $5.5 million, whichever comes first.

Those making purchases in McAlester pay a 10% total sales tax rate or a dime on the dollar — but only 4% of that 10% sales tax total goes to the city of McAlester.

Another 1.5% goes to Pittsburg County, while the remaining 4.5% is the state sales tax. Collins get no part of the state's 4.5% sales tax at the Shops at McAlester site — but the TIF agreement allocates him 90% of the city's and county's shares collected at Shops in McAlester.

CITY OF MCALESTER

An analysis from city of McAlester Chief Financial Officer Sherri Swift regarding the city's sales taxes collected at Shops at McAlester for the months of May, June, July and August show the following numbers:

—May — The Oklahoma Tax Commission collected a total of $11,070.33 in city sales taxes from Shops at McAlester for the month. That breaks down to a $9,963.30 reimbursement for the developer's 90% cut ,with the city's 10% portion coming to $1,107.03.

—June — OTC collected $53,126.95 of the city's sales tax at the Shops at McAlester site. Burk Collins & Company's 90% totals $47,814.26, with the city's 10% totaling $5,312.69.

—July — With the OTC collecting $40,046.30 of the city's sales taxes from Shops at McAlester, Collins is set to receive $36,041.67 as a 90% cut, while the city's 10% share amounts to $4,004.63.

—August — For August, Shops at McAlester registered its best month so far, with the city's total sales tax coming in at $62,772.88. Collins' 90% share totaled $56,495.59, with the city's 10% totaling $6,277.29.

When all four months are added together, the total amount of the city of McAlester's sales taxes collected during that time period from Shops at McAlester breaks down as follows:

—City of McAlester's total amount of sales tax collected at Shops at McAlester for May through August 2022 — $167,016.46

—The 90% to be reimbursed to Burke Collins and Company from that four-month period — $150,314.82.

—The 10% that goes to the city for May through August — $16,701.64.

PITTSBURG COUNTY

Also, money to be paid to Burk Collins and Company through the TIF agreement includes Pittsburg County's 1.5% portion of the sales tax collected at Shops at McAlester.

Pittsburg County Treasurer Jennifer Hackler provided a breakdown of the county's portion collected at Shops at McAlester, also for May though August 2022.

—May — The Oklahoma Tax Commission collected $4,435.06 of total sales tax from Shops at McAlester on behalf of Pittsburg County. Collins' 90% cut comes to $3,991.55, with the county's remaining 10% totaling $443.51.

—June — Total collected by OTC of the county's 1.5% portion of Shops at McAlester came to $19,941.49. Collins & Company's 90% reimbursement totals $17,947.34, with the county's 10% share coming to $1,994.15.

—July — Pittsburg County's share of sales tax collected at Shops at McAlester totaled $14,973.95. The 90% reimbursement of that amount to the developer is $13,476.56, with the county's remaining 10% totaling $1,497.39.

—August — Pittsburg County had $23,554.82 as its share of sales tax collected at Shops at McAlester. The developer's 90% reimbursement totaled $21,199.34, with the county's 10% share totaling $2,355.48.

When the four months are added, the total amount of Pittsburg County's sales taxes collected during that time period from Shops at McAlester breaks down as follows:

—Pittsburg County's total amount of sales tax collected at Shops at McAlester for May through August 2022 — $62,905.32.

—The 90% of Pittsburg County's total to be reimbursed to Burke Collins & Company from that four-month period — $56,614.79.

—The remaining 10% of the county's total that goes to Pittsburg County for May through August — $6,290.53.

CITY AND COUNTY TOTALS

When the $167,016.46 in sales taxes collected on behalf of the city from Shops at McAlester is added to the $62,905.32 collected on behalf of the county from May through August, the two amounts total $229,921.46.

Burk Collins & Company's share of the $150,314.82 90% reimbursement reflecting 90% of the money collected on behalf of the city of McAlester at Shops at McAlester on May through August, added to his 90% reimbursement of the $56,614.79 collected on behalf of Pittsburg County during the same time period totals $206,929.61.

That $206,929.61 represents the amount Burk Collins and Company is to be paid per the TIF agreement from the city and Pittsburg County combined for the four-month period covering from May through August 2022.

Swift, the city of McAlester's CFO, said the TIF agreement calls for payment to be made on the one-year anniversary of when the first business that opened at Shops of McAlester made its first sale — and that would be Starbucks. The city is planning on making its first payment in March 2023, which will cover the 12 month period since Starbucks opened in March 2022, Swift said.

The Shops at McAlester project hit some bumps along the way, much of it attributable to the COVID-19 pandemic and supply side shortages that have been felt nationwide.

Seeing the first stores open at the site has been a long process for the city of McAlester, which started working toward the development of a new highway retail center several years ago. Some of the initial attempts through other potential developers didn't work out.

Things finally started moving forward when Burk Collins of Burk Collins & Company came on-board about four years ago.

Collins took on the project through a Tax Increment Financing agreement with the McAlester City Council and the Pittsburg Country commissioners. Initial details were worked out through the McAlester Area Southside Reinvestment Committee, also known as the Highway TIF Committee, which consists of representatives of entities which benefit from city and county tax collections.

Several delays occurred during the construction process, with some attributed to disruptions resulting from the COVID-19 pandemic and others to supply side shortages, but the project kept moving.

Today is already drawing the aforementioned thousands of visitors each month — a number expected to increase as each new business opens.

Contact James Beaty at jbeaty@mcalesternews.com.