Let me first say that we are generally very supportive of the city of Eureka and the direction their staff and Council are taking in our town. The innovation, vision and initiative they have shown on many fronts is refreshing and exciting.
In the matter of the development of the old truck stop property, however, we have to take exception. In the Economic Development profile on its website, the city declares that “small business is the backbone of our economy and that 75 percent of new jobs are generated by them.” But what is the city doing to support small businesses in our area?
A couple weeks ago, the Community Development Director was quoted as saying that he regularly contacts Whole Foods and Trader Joe’s to encourage them to come to Eureka. Ironically, the following week, our friends at the North Coast Co-op shared some of the struggles they have been addressing in this very tight and competitive marketplace. Does the city not know that our local economy has constricted in the past two years? Do they understand how fragile and precarious is the survival of many of our small businesses?
Now the city staff are recommending that the council support the developer’s demand to fund a part of this project that would bring two or more national chain restaurants to Eureka with a gift of $450,000 from the general fund. City staff estimates that there would be approximately $6.8 million in annual sales that would generate $120,000 in tax revenue per year based on Eureka’s 1.75 percent share of sales tax revenue. They also estimate that about half this annual amount would be new revenue to the city with the remaining revenue replacing lost revenue from current operators.
What is unknown is to what extent the sales of existing restaurants would be “cannibalized” by these new chain restaurants. There are only so many food dollars in our community. How many jobs might be lost and how many local businesses might be forced to close altogether with this subsidy?
We call on the City Council to take time out to study this issue more closely and to involve the public and small business stakeholders in this decision. As an alternative, we also suggest that the city consider using some available funds to fulfill their professed commitment by supporting Eureka’s small business sector with resources designed to grow local businesses and help them generate additional sales taxes and jobs.
Contact your Eureka officials:Mayor:Frank JägerPhone: 707-441-4200Ward 1:Marian BradyPhone: 707-441-4169Ward 2:Heidi MessnerPhone: 707-441-4168Ward 3:Kim BergelPhone: 707-441-4170Ward 4:Austin AllisonPhone: 707-441-4167Ward 5:Natalie ArroyoPhone: 707-441-4171Mailing address:City Hall, 531 K St.Eureka, CA 95501-1165Phone: 707-441-4172Fax: 707-441-4138