Orem's reluctance to wave financial carrots in front of potential mall tenants may ultimately cost the city its crowning jewel, the University Mall.
Some business leaders already believe the popular 1300 South/University Parkway mall suffered a possible fatal blow when Provo lured JC Penney away as an anchor in its new Provo Towne Centre Mall.
They fear ZCMI may be the next to go.
Orem Mayor Joe Nelson referred to the possibility in Tuesday's council meeting when he told Merrill Farley to tell his son, Ron Farley, that ZCMI needs to stay in Orem. Ron Farley is the local ZCMI store manager.
Delance Squire, retired director of Orem's economic development organization, says Provo has offered incentives so enticing they boggle the mind.
"They won't make any money for the next 20 years," he said. "They have the expectation that they'll be making $2 million a year. The University Mall brings in $1.4 million with twice the retail floor space. I don't know how Provo thinks they'll do more with half as much retail space. The arithmetic doesn't work."
JC Penney was offered a one-quarter ownership in the mall, Squire said. Dillards will be refunded $15 million in sales tax revenue.
Now the offer being made to ZCMI is "another one that's too good to be true," he said. "The mall will need to come up with some real incentives to persuade them to stay (in Orem)."
Orem's current council is stocked, however, with members and a mayor who campaigned against the use of tax incentives or property tax rebates to keep and lure businesses.
"If we did some of the things they're doing in Provo, we'd be crucified," Squire said.
Orem residents worried extensively and vocally over incentives extended to R.C. Willey furniture even though it was all paid back within four years, he said.
"It was a doggone good investment that kicked the door open for 1300 South development," he said.
Meanwhile, Provo is willing to lower rates on power and waive the cost of obtaining building permits as well as sweeten the pot with cash and/or rebates, he said.
"It's very, very competitive. It's a jungle and they're all playing the game," Squire said.
Even the tiny city of Lindon is refunding $1.5 million to the developers of a hilltop strip mall in their community.
Former Mayor Stella Welsh says city officials have met with Woodbury Corp. and University Mall management weekly over the past three years, trying to convince them to move more quickly with renovation and revitalization efforts.
"They're about five years too late now," Welsh said.