Falling sales-tax revenues. An onslaught of vacant storefronts. When your state economy is based on growth, and the national economy goes in the tank, these are the dangers. According to yesterday’s Arizona Republic:

By late next year, more than 75 stores are expected to close, resulting in a loss of nearly 2,000 Arizona retail jobs. The turnover likely will offer shoppers bargains at various going-out-of-business sales and could eventually inspire an influx of newer, trendier stores. But the closures also have city officials scrambling to cover revenue shortfalls and deter commercial blight.

While Wal-Mart may be able to absorb the cost of closed stores and their leases, cities and towns are left dealing with empty buildings that can lead to a rise in crime and vandalism, the lowering of property values, and depressed sales for neighboring retailers when the closed store is the anchor for a strip mall. And for states like Arizona, a drop in sales tax revenue. The Institute for Local Self-Reliance has pointed out that some cities, such as Oakdale, California, or Wauwatosa, Wisconsin, require retail developers set aside money that can be used by the city to either demolish or maintain the site should the store or shopping center become vacant.

Some cities, like Mesa, Arizona, aren’t so lucky.

The shell of a former Walmart sits 2 miles from a Kmart that will close in January. A Mervyn’s and Circuit City will soon depart the area. Such losses this year contributed to Mesa’s $62 million budget shortfall. The city announced 315 layoffs last month.

Cities try to cope with shortfalls in sales taxes, blight left by shut stores [Arizona Republic]

Source : WalmartWatch Blog