This article was originally published in the Asheville Watchdog.
Citing wage concerns, diminished property taxes and the potential loss of the city’s last remaining industrial development site to retail, the Economic Development Coalition for Asheville-Buncombe County has opposed locating a proposed Costco in the Enka Commerce Park.
“By every measure — wages, tax base, and land use — the rezoning of Enka Commerce Park for Costco is simply not in Asheville’s best long-term interest,” Clark Duncan, the EDC’s executive director, wrote in an email to all seven City Council members in late October.
Costco has been searching for a Buncombe location for decades, and locals often drive to Spartanburg or Greenville, South Carolina, to shop at the retailer’s nearest store. Earlier this year, the company submitted an application to the city for a store with 839 parking spaces on 25 acres within Enka Commerce Park, a request that will require the city to approve a conditional zoning amendment.
Costco officials are in town this week to meet with city officials and others to discuss the project.
“While we all enjoy the convenience and appeal of a nationally respected retailer like Costco, it will not grow local wages, accelerate recovery, or strengthen our fiscal foundation at this specific location,” Duncan wrote, referring to recovery from Tropical Storm Helene.
Duncan said several long-range plans for Asheville, including “Living Asheville,” “Buncombe 2025” and the “Asheville 5×5 Strategic Plan” all recommend “aligning workforce, infrastructure, and land use investments to grow household wages and strengthen the tax base needed to sustain essential public services.”
“The proposed rezoning request for Costco in the city’s last remaining industrial park, however, runs counter to this consensus, to best practices, and to the region’s long-term economic interests,” Duncan wrote.
He also noted that local household income trails state and national averages, and that manufacturing typically pays better than retail.
“In Buncombe County, for example, the average manufacturing wage is $82,008 — nearly double the retail average of $43,918,” Duncan said, citing Lightcast Data. “Across the nation, communities fight to protect suitable industrial land for precisely this reason. In an era of rising cost of living, Asheville cannot afford to do otherwise.”
Costco’s wages, benefits package
Renee Rutherford, Costco’s director of real estate, said the company has seen the EDC email but will not comment about it.
Costco did provide a fact sheet on its employment benefits and wages, as well as store performance. Average sales per store/warehouse worldwide are $260 million annually, according to the sheet, and Costco “pays among the highest wages in the industry.”
U.S. hourly wages run as follows:
- Service assistant: $20 to $30.20 per hour
- Service clerk: $21 to $31.90 per hour
- Meat cutters $21.50 to $33.40 per hour
That would put annual salaries, based on a 40-hour workweek, in the low-to-mid $40,000s to a top rate of nearly $70,000.
Costco states that long-term employees are also eligible for bonus checks of $5,000 to $10,000 annually, and that a full-time cashier’s annual salary after 10 years is $70,300.
Costco stores typically employ about 300 workers.
The company also touts its benefits package, which includes “medical, dental, vision, pharmacy, mental health, life insurance, disability, long term care, employee assistance program, flexible spending accounts, employee stock purchase program, 11 holidays per year, college student retention program, 401(k) and a free Costco Executive Membership with an annual 2 percent reward.”
Part-time employees who work more than 23 hours weekly get core medical, dental and vacation benefits after six months, according to the fact sheet.
In his letter, Duncan also stressed that the Enka site is zoned for three new industrial buildings totaling over 600,000 square feet. (Just one has been built.) Duncan said that’s enough space to house New Belgium Brewing, GE Aerospace, and AVL Technologies, and those three companies’ properties have an assessed tax value of $200 million, according to Buncombe County tax figures.
“By contrast, Costo proposes a building like that of its largest competitor in Asheville, roughly 131,000 square feet, that carries a tax value of $9.9 million,” Duncan wrote. “While adding value, it is significantly less than that of the industrial buildings currently planned for this location.”
The site, the former location of the American Enka rayon plant that dates to the 1920s, also has received more than $10 million in tax dollars for improvements to roads, bridges, sidewalks, and greenway design, all in support of potential industrial employment, Duncan pointed out.
Asheville Watchdog reached out to Martin Lewis, whose company is partnering on the site development, but did not hear back by deadline.
Buncombe County has invested $10 million in the Enka Commerce Park, the NCDOT about $2.5 million and the federally funded Appalachian Regional Council $3.1 million.
“The park now supports over a dozen manufacturers, employs 700 local families, and generates some 300 daily freight shipments, ranking among the largest manufacturing centers in all of Western North Carolina,” Duncan wrote. “Introducing retail zoning into this premier industrial park would undermine decades of public investment, community planning and safety.”
In closing, Duncan suggested the EDC and council work together to find a site that’s a better fit.
Proposal is winding through a complex city process
Costco, a national wholesale retailer with 692 stores in the U.S. and Puerto Rico, will have to secure approvals from the city’s Planning and Zoning board and City Council.
The Watchdog reached out to all seven council members but only heard back from Bo Hess by publication time.
A few weeks ago, Hess posted a comment on Facebook that mirrored the EDC’s position. On Wednesday, Hess said he had been lobbied by the EDC and some members of the Buncombe County Board of Commissioners to keep the site for manufacturing.
But Hess has modified his position, noting that the Enka site has remained mostly empty for years. He said he met with Costco representatives and company attorneys about three weeks ago. He suggested smaller sites, including one near downtown off Biltmore Avenue where the former Matthews Ford car dealership was, a location that could address the issue of a food desert downtown.
“However, they were really not going for those sites, and I understood why,” Hess said. “They feel like being near a highway and a freeway is most advantageous for them in their business model, etc, etc. So we decided to reconvene.”
Hess’s post also generated a lot of feedback on Facebook and to him directly via email and texts. The recurring theme was “constituents saying that they really wanted Costco, and that they thought it would be a great opportunity for Asheville,” Hess said.
Multiple factors led him to change his stance, Hess said.
“One, I work for the people, and I listen to my constituents, and so that’s very important to me, to hear feedback from them about any given topic,” Hess said. “Two, we need good paying jobs here. And three, we’d still be able to get property tax and tax revenue from Costco.”
The area also needs more options for groceries and supplies, he said, “And I believe competition helps everybody.”
Hess said he was meeting with Costco officials again today, “and hopefully going to seal the deal and get Costco here and put it on our agenda in January, so we can approve it and we can start moving forward.”
Clay Mitchell, an urban planner with the City of Asheville, said Costco has “participated in the preliminary steps in our process, which include the neighborhood meeting and preparation of the application.”
At that neighborhood meeting in August, neighbors expressed concerns about increased traffic but were mostly receptive to the company. Costco officials said then the approval process could take 12 months, and store construction another year.
Costco has completed the initial Technical Review Committee hearing.
“The conclusion of that hearing resulted in an ‘approval with administrative revisions required,’” Mitchell said. “This result states that there are issues and revisions that must be made or provided before the application and plan set can move to the Planning and Zoning Commission and ultimately to the City Council.”
It’s tough to pin down an estimated time frame for these upcoming steps, Mitchell said.
“We are awaiting responses and updates for the TRC to be able to sign off on the completion of the initial step,” Mitchell said. “Once that happens, we will be able to move the application forward.”
In a phone interview and email followup in early December, Duncan stressed that he is not opposed to Costco coming to Asheville and acknowledged that the company is considered a good employer. He just wants the company to locate elsewhere within Buncombe County.
“I’m not anti-Costco — I appreciate their good corporate citizenship, that they pay living wages, (and) I think there is also prestige and convenience that comes with their arrival,” Duncan said. “But this is a nuanced discussion — and I encourage consideration of what we are being asked to give up in exchange for shopping convenience.”
Duncan believes the community needs to have a meaningful conversation about the proposal.
“We’ve not had any discussion about the actual cost to our longtime economic development goals if we offer rezoning to the last graded, fully served and planned industrial park in city limits,” Duncan said. “Zoning and land use plans exist so that our council is not forced to accept the proverbial bird in hand. They can instead point to years of consensus building and planning and strategies that have made Enka Commerce Park the largest manufacturing center in western North Carolina.”
Costco has been looking here for decades
Duncan acknowledged that Costco has been searching for a Buncombe site for at least a decade, although one local commercial real estate company owner, Pulliam Properties President and CEO Rusty Pulliam, says the company started looking here even earlier – in the late 1990s.
Pulliam said Costco has particular parameters for what it considers an acceptable site, as it needs about 25 acres near an interstate interchange. Pulliam said he understands the position Duncan and the EDC are in, as it’s that entity’s job to promote manufacturing jobs.
But Pulliam, who has worked for years with Costco on scouting potential sites, said manufacturers have not snapped up that land since it was made available two decades ago, and he notes that the current warehouse building on site is not fully leased. He also pointed out that the Enka Commerce Park, formed by a group called Fletcher Partners, at one point marketed the site as a potential retail location and tried to entice Walmart to locate there.
“Let’s face it: Asheville is not going to yield a tremendous amount of new manufacturing jobs ever, because we’re in the mountains, (and) we don’t have the appeal that a lot of the major manufacturers (want),” Pulliam said.
He also said that Enka Commerce Park, with access off Smokey Park Highway and Sardis Road, is a de facto retail site, pointing to Ingles and Food Lion supermarkets nearby and a new Aldi that’s planned for the area.
“Another major grocery store is looking to go on that same street,” Pulliam said. “It is a retail corridor and not an industrial zone. It was for many years, but as time has gone on and the roads got built to five lanes, it has become a retail area.”
Should the site fall through, Pulliam said, it might be tough to find another Buncombe location that meets Costco’s requirements.
Asheville’s metro area has enough population to sustain a store, Pulliam said, but the area is constrained by its mountainous terrain.
“Costco wants to be in this market,” Pulliam said. “Finding 20 to 25 acres of land in a retail corridor off an interchange right now today is almost impossible. I don’t know that it exists today.”
Pulliam also disputes Duncan’s assessment of the tax value of retail versus industrial properties, noting that his evaluation doesn’t address the high sales tax revenue a Costco would generate.
Buncombe County levies a 2.25 percent sales tax, in addition to the state’s 4.75 percent. Revenue from that 2.25 percent tax goes to Buncombe and its localities.
Based on Costco’s per store annual sales average of $260 million, that’s $5.85 million in sales tax annually that would flow to Buncombe and its municipalities. Pulliam believes Costco jobs would likely pay higher than industrial warehouse positions the Enka site would most likely draw, and he stressed that thousands of locals have been clamoring for a Costco for decades.
“I don’t want to see Asheville screw this up,” Pulliam said.
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