The score in the ongoing battle between Orem and Provo for retail dollars: Orem down one, up two.

It was announced late Wednesday that ZCMI is opting to stay in its University Mall location and is shunning an offer to relocate to Provo Towne Centre, the mall JP Realty is building in south Provo.Also, the ink is drying on a letter of intent for Nordstrom to become another major anchor of Orem's 25-year-old regional shopping center, owned by Woodbury Corp.

The news has Orem officials feeling like University Mall will be able to retain its place atop Utah Valley's economic hill. Or at least put up a good fight.

After JC Penney's anchor store was drawn away by lucrative incentives to the Provo mall, being offered part ownership, there was considerable concern left in Orem that ZCMI would soon follow suit. City officials consistently heard rumors that the retailer was being heavily recruited to join the lineup at Provo Towne Centre.

Ultimately the Mayor's Advisory Council issued a public call for Orem to do whatever necessary to keep ZCMI in place. Former Mayor Joyce Johnson and long-time resident Harley Gillman signed a letter reaffirming the importance of University Mall to the community and strongly urged city officials to recognize the critical need to help keep the mall viable.

Thursday, City Manager Jim Reams acknowledged that the City Council will be asked at next Tuesday's meeting to approve incentive offers in the form of a complex sales-tax rebate agreement.

Actually there are two incentive offers being made, a three-party agreement between the city, ZCMI management and Woodbury and another from Orem to Nordstrom through Woodbury Corp.

The incentive package may have an uphill battle with the council and mayor, or at least a compromise on some campaign promises.

Mayor Joe Nelson said in his campaign literature: "It's time for Orem city to end large unnecessary give-away programs to companies to locate in our city." Councilman Mike Thompson has also registered a basic dislike of incentive offers and rebates, along with Councilman Joseph Andersen. Councilwoman Judy Bell has said publicly she would prefer not to support agreements that give one business more than another to set up shop in Orem.

Reams said he believes the council and mayor recognize this situation is unique and that the best thing for Orem is to keep the mall viable rather than try to rescue the area after the fact.

"We already have JC Penney building in the Provo mall and planning to vacate. If we lost a second anchor, that would dramatically affect the mall's viability," Reams said. "That's the bottom line. We have to do what we can to keep it healthy."

Nordstrom will replace the JC Penney anchor position in southeast corner of University Mall, but with a much larger store that is expanded to the east. It will utilize 100,000-120,000 square feet.

"We've been serving the Utah community since 1980 and it is exciting for us to announce a fourth store in the market at University Mall," said Jim Nordstrom, co-president of the department store chain.

ZCMI is also going to remodel and add another 40,000 square feet of space.

Both stores will be part of the University Mall's four-year revitalization program announced in January 1997 and designed by Callison Architecture Inc., which coincidentally is Nordstrom's architectural firm.

With Wednesday's announcement, University Mall will be anchored by Mervyn's, ZCMI and Nordstrom. Provo Towne Centre will be anchored by Dillard's, Sears and JC Penney. Officials from both malls say they're continuing to look for more anchor stores.