Speakout: Brookings voters hold antidote to ‘Kool-Aid’

Dave Graves, Volga
Posted 1/19/24

I attended my first study session of the Brookings City Council on Jan. 16. I found it to be an interesting and bewildering experience.

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Speakout: Brookings voters hold antidote to ‘Kool-Aid’

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Editor's note: This Speakout was submitted by Volga resident Dave Graves.

I attended my first study session of the Brookings City Council on Jan. 16. I found it to be an interesting and bewildering experience.

Interesting because there wasn’t any studying done by the City Council. It was a 90-minute propaganda session. Bewildering because I just can’t understand how so many well-educated, intelligent people cannot have realized they “drank the Kool-Aid.”

The issue is the Brookings Marketplace, a 26.25-acre site near the Sixth Street and I-29 interchange that the city purchased in November 2013 for $1.6 million (1.41 per square foot) from the South Dakota Department of Transportation after DOT moved its highway shop to another tract north of there.

The city thought it had scored a great bargain because the DOT agreed to a much lower price than originally sought. The city thought it walked away from the table with the golden goose to retail development. Instead, it has been a boondoggle that now is entering its second decade. The more I listened at the Jan. 16 council session, the clearer it became that government shouldn’t go into the retail development business.

Now what is at issue is whether Ryan Companies, a Minneapolis-based development company which has an agreement with the city, should be granted an amended agreement. Ryan only wants to develop the front 10 acres rather than the 18.53 acres it committed to in a February 2023 agreement.

The downsizing comes after a major retailer discontinued its interest in the site. (That would be Target, the widely understood but never publicly stated anchor.) Now Ryan Companies is working with the grocer Aldi and an unnamed “well-known Midwest furniture company,” according to Ryan’s VP of retail development, Patrick Daly.

The council and city administration justify selling off the prime chunk of its 26.25-acre tract because they state it will reduce retail leakage and increase sales tax revenue.

No one would be opposed to reducing retail leakage and growing the city’s sales tax intake. But at what cost? Brookings already has two major grocers and two major furniture dealers. I’m not opposed to more competition, but it isn’t the city’s job to pick winners and losers.

Apparently the council has heard others make that argument. Councilor Andrew Rasmussen asked one of the officials brought in to support the city’s position to explain “how we’re not bringing in a grocery store to compete with existing groceries stores.”

The question was fielded by Tim Reed, executive director of the Brookings Economic Development Corp. and mayor of Brookings when the purchase was made in 2013. Speaking from Pierre, where Reed serves as state representative, he cited information from a retail leakage survey and confirmed to Rasmussen that the proposed two new anchor tenets “wouldn’t be taking sales from existing stores.”

I doubt Hy-Vee, Walmart, Slumberland or Brookings Furniture feel that way.

Clearly adding a third grocery store or furniture store is creating more competition. How can you possibly say otherwise? Kool-aide is the only explanation I can see.

No doubt people are leaving Brookings to purchase items that could be purchased at Hy-Vee or Walmart. However, very few are going to Aldi, which has locations in Watertown and Sioux Falls. Where are they going? No commissioned survey is necessary. Just listen to your acquaintances’ conversations.

They’re going to Sam’s Club or Costco. Aldi’s won’t address that issue. Furthermore, Ryan’s Daly acknowledges, “We are far from finalizing our agreement with Aldi’s.”

What is immediate is a public vote on whether the city should be allowed to go ahead with its plan to slice back its development agreement with Ryan Companies to the front 10 acres. The purchase price is $1.40 per square foot for the prime 10 acres. That is the same price Ryan agreed to for the 18.53 acres it committed to develop in February 2023.

You don’t have to be an appraiser or a retail developer to know that the land closest to the major street is going be valued higher than land away from heavy traffic. (Think 41st Street in Sioux Falls.)

If the 18.53 acres was worth $1.40 per square foot less than a year ago, the prime section of that tract has to be worth more. To a non-Kool-Aid drinker, that seems obvious.

There are a myriad of reasons why this entire project has been ill-conceived. It’s debatable if the proposed city-Ryan agreement will get the ball into the end zone, as Councilor Nick Wendell stated. If it does, it will be a touchdown that NETS zero points.

Therefore, I urge Brookings voters to vote “No” when they go to the polls on Jan. 30.