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"Not So Fast" Local Restaurants Say

February 29, 2008
By some estimates $14.5 million per year of Arab money is spent in restaurants in surrounding cities.  It was a portion of that money that the Arab CDA and City officials were trying to keep in Arab with the Applebee's deal according to Mayor Frank Lee Cox.  "We would never knowingly hurt any local business whatsoever," Cox said Thursday afternoon.  "We have great businesses, great restaurants....restaurants that I eat in all of the time." he added.

Representatives from the restaurants as well as several retail business owners expressed concern at the plan that calls for the CDA to issue bonds to purchase land and construct a building for lease by Quality Restaurant Concepts, LLC of Birmingham. The plan would also commit the city to possibly subsidize the bond repayment (See earlier article) by earmarking two of every four cents of the tax revenue generated by the Applebee's restaurant until predetermined profitability levels are met by the restaurant. 

While the local restaurant representatives expressed concerns that the local economy cannot support additional restaurants, the biggest concern was the financial assistance that the Applebee's deal would provide to QRC.  Financial assistance that they say is not available to them and would provide an unfair advantage.

Tim Talley, owner of Mink Creek Outfitters - Cafe and Coffee House, said, "I think it is very unfair to bring Applebee's in at less than we have to pay when there is a limited amount of dining dollars to divide."  Talley said that he has personally invested somewhere in the same range as the Applebee's proposal in order to build his business.

Arby's manager, Ken Moore, said the claims of adding 150 jobs will turn out to be a job swap because some current restaurants will close.  He also questioned the staffing numbers in the proposal.  "I think the number of staff will be more like 80-85." Moore told the group.  "It will do good for the first year and begin to tail off, but by then two or three restaurants will be gone." he added.  The Guntersville Applebee's and O'Charley's Restaurants each employee 58 employees according to a survey done by a member of the retail group.  Those restaurants serve a larger market and include alcohol sales according to the report.  Moore said Arab is geographically isolated and the market area is limited with customers going to other cities past certain points.  "The city needs to bring in more dollars through industrial jobs instead of cutting up the pie." Moore added.

Keith Meade, one of the owners of Three Guys Grill, questioned the cost of the project. Meade said the 1.7 to 2 million dollar price tag for the Applebee's project is too high.  He said the proposed 5,000 square foot building and land deal could be done for 1.2 to 1.5 million dollars. Tommy "T-Bone" Ellenburg, also a Three Guys Grill owner, asked about the makeup of the CDA Board.  Ellenburg pointed out that, "None of the CDA members are restaurant or retail business owners."

A common theme among those speaking at the meeting was that QRC is trying to position themselves in Arab ahead of an expected alcohol referendum in November.  Sierra's Mexicanisimo owner Alex Sierra said they are betting on the legalization of alcohol sales in November.  "If they come in with fair play, then welcome...more than welcome," Sierra told the group.

According to stats provided by the Guntersville Applebee's and O'Charley's restaurants in the previously mentioned survey, their percentage of sales attributed to alcohol are 4% and 12% respectively.

Arab City Councilwoman Diane Prestridge, who attended the meeting, fielded questions about the proposal by those in attendance.  After hearing their concerns, Prestridge suggested the group schedule a meeting with the CDA Board to discuss their concerns and to allow the CDA Board to explain what they see as positive about the proposal.  Prestridge told the group that she has some reservations about the proposal and still has several unanswered questions.  Prestridge said, "We want to grow but we want to keep the businesses that we have.  Applebee's is a large chain with a lot of backup but local restaurants have no backup."  She said she is also concerned the deal would hurt the City's ability to borrow money in the future.  Prestridge told the group that she is still uncomfortable with the proposal and plans to ask the council to table the measure until she can get answers to her questions.

The group agreed to send a letter to the council and to local media outlets asking the council  to delay a decision on the proposal until they meet with the CDA and their concerns are heard.

There was at least one lighter moment during the meeting.  When asked if anyone could see a positive aspect to the plan, Ellenburg said, "Yea, they have a $9 half pound cheeseburger and we have a $6 half pound cheeseburger with a lot more fixings."

				

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