March 2008 Shopping Center Association Vol 22. No 3

In this Issue

Pinnacle Vill. Shoppes --- SNAPSHOT 1

Cambria Suites ------RISING STAR 3

Legislative ------COMMITTEE PROFILE 4

Nordby / Eggert ---- MEMBER PROFILES 5

Retail Site Selection - PROGRAM RECAP 6 Spend or Save - HOT SPOTS / COLD SNAPS 7 Connection

Feature: CityView Compiled by: Ross Dahlin, Itasca Funding Group, Inc. Profile: Mayor Chris Coleman, St. Paul

The newsletter committee is dedicated to bringing MSCA The housing market downtown has members news and information that is fresh, timely and developed a younger, educated, relevant. Last year, we introduced CityView, a periodic and single resident profile for the column featuring interviews with city leaders from around many cultural and natural resources. the region exploring the state of retail development The demographic changes in their areas. in residential profile means that businesses need to This month we spotlight St. Paul Mayor Chris Coleman, adapt to residents’ wants who shares some thoughts on downtown and needs. development, the ongoing impact of the and the upcoming GOP convention. We are just now starting to see the impact the recent increase in MSCA: With all the new residents moving into downtown in residents is having on the business recent years, why have retail sales remained flat and stores environment – several new continue to close? restaurants and nightclubs have opened and more are planned. We believe that the “resident model” versus the Mayor Coleman: We know retail turnover can be “mall model” that typically brings visitors in from the outside affected by any number of circumstances, such as the is a more sustainable development plan for Downtown St. economy or the fundamental shifts in demographics. Paul retailers. Traditional mall settings experience similar turnover as downtown areas. MSCA: The Quarry in northeast Minneapolis has been a successful infill “Big-Box” development. Are there any sites in Snapshot

Location: Highways 2 and 71 in Bemidji Pinnacle Village Month/Year Opened: Phase I is planned to open 2009 Owner: Pinnacle Village – Bemidji, LLC Shoppes Managing Agent: Capital Growth Madison Marquette Leasing Agent: Traditional Center leasing - Russ McGinty; Outlet Center leasing - Harry Takhar, Steve Fisher and Tedd Schuster, Capital Growth Madison Marquette (952) 852-5186 Architect: KKE Architects Construction Contractor: TBD GLA: Approximately 460,000 sf of retail in Phase I # of Stores: The project will include outlet stores, big box retailers, restaurants, hotel, theatre and additional retail. Anchor Tenants: TBD Market Area Served: Will draw “local” customers from a radius of more than 100 miles, with the outlet center pulling shoppers as far as 200 miles away. Bemidji is also a huge tourism destination year round attracting more than six million visitors annually. Additional Facts/Narrative: The site is approximately 80 acres. The center has no significant competition within 200 miles. Retailer interest in the project has been high.

msca-online.com 1 MSCA Connection Mar 08 CityView - continued St. Paul that could accommodate a similar are smart for both current and future type development? residents and do not put an undue burden 2008 Sponsors on the city’s infrastructure. Each site is Mayor Coleman: St. Paul is always open American Engineering Testing, Inc. unique, and options should always be Aspen Waste Systems, Inc. for business, especially to businesses that available to adapt the proposed Barna, Guzy & Steffen, Ltd. can fit the site, benefit the community, and development to the site. The Quarry works Bremer Bank, N.A. ensure the integrity of both the city and the Brookfield Properties for its site, and Excelsior & Grand works CB Richard Ellis neighborhood in which it will sit. SuperTarget where it is located. Cities have the CSM Corporation and Menards on University Avenue and the mandate from its residents to advocate for Cambridge Commercial Realty Cub Foods planned on Phalen Boulevard the right development for its sites. Capital Growth Madison Marquette are great examples of how large retail can Chesapeake Companies Chuck & Don's Pet Food Outlet work in an urban setting. Opportunities MSCA: Can you give us an update on the Colliers Turley Martin Tucker abound in St. Paul for the right retail Bridges of St. Paul? After the city council’s The Collyard Group L.L.C. development, from the Central Corridor on rejection last fall, have you met with Mr. Commercial Partners Title, LLC Cuningham Group Architecture, P.A. University to St. Paul’s East Side along both Trooien to discuss the future of the site? Cushman & Wakefield of Minnesota, Inc. Phalen Boulevard and White Bear Avenue. Dick's Sanitation, Inc. Mayor Coleman: The City welcomes the Doran Companies MSCA: Do you view the Mall of America opportunity to speak to Mr. Trooien or any Dougherty Funding LLC and its planned expansion as a competitor developer for the West Side Flats when they Emmes Realty Services LLC Exeter Realty Company or a complement to retail development in can present a development that is Faegre & Benson LLP St. Paul? consistent with the city’s Comprehensive Fendler Patterson Construction, Inc. Plan, includes meaningful input, and limits Fredrikson & Byron, P.A. Mayor Coleman: Rather than competing General Growth Properties, Inc. the financial risk to taxpayers. The Mississippi Gray Plant Mooty with the mall, retail in St. Paul has been able to River is the lifeblood of St. Paul, and we Great Clips, Inc. complement the MOA’s mass consumer remain committed to expanding the West Griffin Companies choices with a healthy mix of unique boutiques Side neighborhood. H.J. Development, Inc. and well known retailers that set our shopping Hempel Inland Real Estate Corporation districts apart from the mall, whether they are in MSCA: Are you aware of any new Itasca Funding Group, Inc. Highland Park, along Grand Avenue, or in restaurants or retailers that will open JE Dunn Construction District del Sol. In St. Paul, we know that the downtown before the GOP convention? Do Jones Lang LaSalle/Rosedale Center KKE Architects, Inc. future is not in competing with MOA or other you think attendees will perceive St. Paul as Kraus-Anderson Companies malls, it is about creating the right experience a “vibrant” city? LandAmerica that caters to St. Paul’s diverse residents and Landform intrigues the city’s neighbors shop and explore. Mayor Coleman: St. Paul will exceed Larkin Hoffman Daly & Lindgren Ltd. the expectations of the convention Let There Be Lights! M & I Bank MSCA: Which retailers have shown interest attendees. We are truly a unique city on the McComb Group, Ltd. in locating in St. Paul and how has the city Mississippi, one with a flavor of the old world McCombs Frank Roos Associates been involved to assist in any potential with the Landmark Center, Cathedral, and Messerli & Kramer P.A. Midwest Maintenance & Mechanical, Inc. development? Capitol; one with a strong work ethic with Minneapolis/St. Paul Business Journal our barges, trains, and cranes; one that is NAI Welsh Mayor Coleman: We receive inquiries healthy and active with trails, parks, and NorthMarq Capital, Inc. from both national retailers and independent boats; and one that has history and civic Olsson Associates entrepreneurs. Consumer data shows that Oppidan, Inc. pride, from Mancini’s and W.A. Frost to the Opus Northwest LLC residents in St. Paul have money and are James J. Hill House and the diverse districts Park Midwest Commercial Real Estate shopping, and that is drawing interest, such as in District del Sol and Central Corridor. Paster Enterprises the recent Trader Joe’s proposal. Our Planning RJ Marco Construction Inc. There are few cities in the nation that can also RLK Incorporated and Economic Development Department RSM McGladrey, Inc. stands ready to provide assistance to all boast the culinary diversity in a small RSP Architects retailers who wish to learn more about the geographic area as downtown St. Paul offers. Reliance Development Company, LLP entrepreneurial opportunities and incentives From world-class sushi to French nouveau, and Robert Muir Company the nation’s first Kurdish restaurant, downtown Ryan Companies US, Inc. available in the city. Shea, Inc. St. Paul has something to satisfy any taste. Shingobee MSCA: Recently the city and Along with authentic neighborhood taverns, a Solomon Real Estate Group Inc. neighborhood groups have required renowned jazz club, and new nightclubs, visitors Stewart Title Guaranty Company Stonehenge USA condominium and apartment developers are going to find a city alive day and night. TCF Bank to include first floor retail space in their All said, St. Paul has the best of east and projects. Quite often this space is difficult to U.S. Bank west with the pride of a city on the lease because of design, parking, and United Properties Mississippi. People are going to find a city The Velmeir Companies other issues. Should it be the city’s business that runs and bikes in the morning, works Venture Mortgage Corporation to force retail development on a project? Weis Builders, Inc. during the day, socializes in the evening, Wells Fargo Bank, N.A. Mayor Coleman: Smart land use and and sleeps safely and quietly at night. Not Westwood Professional Services, Inc. transit-oriented development are concerns just vibrant, attendees to the RNC will know Winthrop & Weinstine, P.A. for cities, especially mature, urban cities. us as the Most Livable City in America. We have a responsibility that developments

MSCA Connection Mar 08 2 msca-online.com rising star by Lisa Diehl Featured Sponsors Cambria Suites ambria Suites is a select-service all-suites hotel brand that offers Company visions thoughtful modern design for the way people live. This brand of CChoice Hotels International was launched in 2005, and is a new Aspen Waste Systems, Inc. construction brand designed to appeal primarily to the business traveler, To provide service with a yet it is well suited for the leisure traveler with exceptional service personal approach while standards. The most popular target areas identified for the brand are building long term airports, mixed-use developments, leisure destinations and aggressively relationships. growing commercial corridors.

Bremer Bank, N.A. Each hotel typically offers 100 to 150 units with a stylish, To deliver exceptional value contemporary design and the buildings are four or by providing individualized more stories, which is 25% larger than the industry “Minneapolis and solutions to our clients. standard. All rooms are suites with separate living/work room and bedroom areas. In-room amenities include St. Paul continue CB Richard Ellis luxury bedding and linens, plasma TV’s, refrigerator and to be Target To be the trusted advisor to microwave, ergonomic desk, and high-speed wireless Markets for Internet access. Public spaces include club lounge owners and occupiers of Growth, as well commercial property. seating, state-of-the-art-health and fitness club, pool, and a meeting space. Food and beverage options as Duluth and Chuck & Don’s Pet Food Outlet include a hot and cold breakfast buffet. Typical site size Rochester.” At Chuck & Don’s we care requirement is 2.3 to 2.5 acres with a building coverage about pets, people, and of 18,000 sf, and 130 parking spaces. doing the right thing. Our Cambria opened two locations in the Twin Cities in vision is to provide the best 2007. They include Bloomington along Highway 494 and Maple Grove in The Grove retail products, service, and development. Matt Hughes, Director of Franchise Sales for Cambria Suites, notes that education for our customers Minneapolis and St. Paul continue to be target markets for growth, as well as Duluth and enabling them to enrich the Rochester. lives of their pets. We strive to provide an environment that Choice Hotels International is one of the largest and most successful lodging franchisors in enhances the work the world, built on the foundation of the Quality Inn brand. Today, Choice Hotels experience for our customers. worldwide is a franchisor of Cambria Suites, Comfort Inn, Comfort Suites, Quality Inn, Sleep We are passionate about Inn, Clarion, Mair Suites, Suburban Extended Stay Hotels, Econo Lodge and Rodeway Inn pets, we believe in what we brand hotels. The company has gone from a small chain of roadside hotels in the 1930’s to do, and we understand and one of the world’s largest hot franchisors with over 5,000 hotels open and under development in different segments of the industry. promote how pets enhance our lives. Choice Hotels is a public company publicly traded since 1996 (NYSE:CHH). www.cambriasuites.com. www.choicehotels.com Faegre & Benson LLP Service and responsiveness. Named among the top U.S. law firms for client service two United Properties Donates $10,000 to The Caring Tree years in a row. The Caring Tree is pleased to Fendler Patterson announce that United Properties’ Construction, Inc. Community Giving donated $10,000. A “true” design build general This financial contribution will enable contractor providing The Caring Tree to continue to assist exceptional retail based on Minnesota’s K-12 students in-need by quality, service and ensuring that they have the accountability. appropriate school supplies.

Jones Lang LaSalle/Rosedale Center Thank you to United Properties. Pictured left to right: To deliver exceptional strategic, fully integrated Doug Shellum, United Properties, Lisa Dongoske, United Properties, Mike Sims, Mid- services and solutions for real America Real Estate Minnesota LLC & Caring Tree President, Karla Keller Torp, estate owners, occupiers and MSCA/The Caring Tree, Executive Director, Jody Schliemann, United Properties, Tom investors worldwide. Peterson, United Properties, Stacey Bonine, MSCA/The Caring Tree, Associate Director, Ann Riemersma, United Properties msca-online.com 3 MSCA Connection Mar 08 Events Press Releases

Mar 12 Monthly Program: Shopping Center/Mall Focus MN MARKETPLACE

Apr 2 Monthly Program (afternoon): Press releases are printed based upon availability of space and relevance to the local market. Development Rosedale Center announced the addition of restaurant Flame May 7 Monthly Program: Cooking with Fire, Rocco Altobelli Salon & Day Spa, Investment Focus Sephora, White House Black Market, C.J. Banks and J.Crew, Jun 4 Monthly Program: Trends which are all scheduled to open Spring 2008. Jun 16 MSCA Golf Tournament Calhoun Square will undergo a significant transformation in the coming year. The renovation and expansion project is For program place and times and designed to reconnect the urban shopping center with the more info, please go to surrounding neighborhood and make it easier to get into the www.msca-online.com building and circulate from one retail store to the next. MOA is scrambling to make room on their Mall directories for nine exciting new tenants: Best Buy, Geox, Gilly Hicks 2008 Leadership Sydney, Janie and Jack, Lacoste, Levi’s, Papyrus, Pandora Jewelry and Ruehl. OFFICERS President An upscale baby accessories store called Edelweiss is Bruce Carlson, United Properties 1st Vice President expected to open at The Fountain of in April. Cindy MacDonald, Kraus-Anderson Companies 2nd Vice President J.B. Hudson opened on . Stephen Eggert, Target Corporation Treasurer Raising Canes Chicken opened February 1 in the Peter Austin, NAI Welsh Secretary Stadium Village Mall. Peter Berrie, Faegre & Benson LLP Staples has opened in Minnetonka and has signed leases to DIRECTORS Jack Amdal, KKE Architects, Inc. open stores in Apple Valley, Woodbury and Roseville by early Eric Bjelland, United Properties 2009. Deb Carlson, Cushman & Wakefield of Minnesota, Inc. Peter Dugan, CB Richard Ellis Erberts & Gerbert’s opened a new location in the skyway at John Gelderman, Opus Northwest LLC Nancy Litwin, General Growth Properties LaSalle Plaza on February 1. Tom Madsen, Benson-Orth Associates, Inc. Immediate Past President (as director): Herberger’s will open in October 2008 at the Northtown Mall, Jay Scott, Solomon Real Estate Group filling the void left by Mervyn’s in 2004. COMMITTEE CHAIRS Program Paula Mueller, Northtown Mall/Glimcher Properties Jeff Wurst, Chesapeake Companies Membership Committee Chat by Howard Paster, Paster Enterprises Mark Norman, Park Midwest Commercial Real Estate Jeff Horstman, Paster Enterprises Newsletter Deb Carlson, Cushman & Wakefield of Minnesota, Inc. Legislative Andy McDermott, Shea, Inc. Awards Dan Parks, Westwood Professional Services, Inc. The Legislative Committee focuses on influencing the laws and policies that Steve Johnson, Solomon Real Estate Group affect MSCA members in our industry. For the past 20 years, we have influenced Legislative Howard Paster, Paster Enterprises laws, tax policy, and increased name recognition of MSCA at the State Capitol. Rob Stolpestad, Exeter Realty Company Retail Report We have achieved this recognition through several channels. First, our Jen Helm, United Properties Drew Johnson, United Properties educational brochure that is annually distributed to Legislators at the Capitol Technology shows the major impact our industry has on the Minnesota economy. Sean Cullen, McCombs Frank Roos Associates Jim Mayland, Colliers Turley Martin Tucker Golf Second, we co-sponsor Business Day at the Capitol and send MSCA members Brad Kaplan, United Properties to the Capitol for meetings with their Senators and Representatives. Paul Sevenich, Kraus-Anderson Companies Sponsorship Third, our paid lobbyists, Rich Forschler and Sonnie Elliot of Faegre & Benson, Ned Rukavina, United Properties Janele Taveggia, Landform personally deliver our message during the legislative session and provide reports Community Enhancement and feedback to the Legislative Committee. Nikki Aden, Target Corporation Jennie Zafft, Cousins Properties, Inc. Lastly, we hold Legislator Coffee Meetings in districts where MSCA members live, STAFF working to educate our elected officials about our industry concerns. In the past Executive Director Karla Keller Torp year, MSCA members met six times with legislators throughout the area. (P) 952-888-3490 (C) 952-292-2414 Regardless of familiarity with the issues, legislators want to hear from the [email protected] Associate Director constituents who elect them. Stacey Bonine (P) 952-888-3491 (C) 952-292-2416 Please consider joining us for the next meeting in your home or work district. For [email protected] further information, please contact Howard Paster at (651) 265-7865. (F) 952-888-0000

MSCA Connection Mar 08 4 msca-online.com Member Profiles

Leslie Nordby, P.E. American Engineering Testing, Inc. Primary Career Focus: Forensic Engineering and Structural Assessments of Buildings Hometown: Litchfield, MN Education: Bachelor of Science, Civil Engineering Hobbies: Golf, reading, camping and travel Very First Job: Clerk at a Snyder Drug Store Dream Job: Mixing drinks on a beach in Fiji for $100/hour Secret Talent: I think that telling would defeat the purpose of it being a secret Favorite Food: Filet Mignon and mushrooms at Manny's

Stephen Eggert Target Corporation Primary Career Focus: Retail Development: Big Box and Shopping Centers Education: BS University of Minnesota, MBA University of St. Thomas Family: Mary (wife for 35 years), Katie and Adam; empty nester patiently waiting for our first grandchild Hobbies: Travel, camping, Yoga, riding motorcycle, Investment Club and morning coffee with Mary every weekend Very First Job: Pool Boy at the Kahler Hotel–now Ramada Secret Talent: Making soup or 1 to 3 star Sudoko Favorite Food: Chocolate or anything at a Potluck Dinner MSCA Involvement: 2nd Vice President; Director; Sponsorship Committee

New Members Andrea Machmeier Member News The General Counsel, LTD. Jeanne Reiland Roz Peterson Palmquist Joins CSM Tom Palmquist will join CSM Finance & Commerce Cerron Commercial Properties Corporation’s commercial development team as Vice Andrew Braden Matt Johnson President of Retail Development. Braden Construction, Inc. Emmes Realty Services Amdal Earns ICSC Certification Jack Amdal, principal Cory Villaume Katie Viere and manager of KKE Architects’ Commercial Development Marcus & Millichap Kraus-Anderson Companies business unit, is the first in Minnesota to earn professional Sean Doyle Marcus Dahl certification from the International Council of Shopping Marcus & Millichap Dick's Sanitation, Inc. Centers (ICSC). An architect with more than 25 years of Lee Krueger Alan Slindee experience, Amdal joins just 178 professionals worldwide to Emmes Realty Services Marcus & Millichap receive this designation. Jason Rich Linda Ladner Landform’s New Brand Landform introduced an all new Rich Brothers Construction Nova Consulting Group, Inc. look and re-designed website. They designed a new logo Brian Rich David Yung and signature that better represents the firm’s integrated, Rich Brothers Construction Parsinen Kaplan Rosberg & interdisciplinary project design and delivery process. Gotlieb P.A. Michael Graham Samba Named Executive Vice President McCombs Landscape Concepts Theresa Hart Frank Roos Associates named Sirish Samba, PE, Executive Management Lifestyle Commercial Realty Vice-President. Samba has been with MFRA since 1994 and Scott Schmitt Gretchen Kungu has managed land development engineering projects and Shingobee Inland Real Estate Corporation municipal utility improvements. Patrick Lenertz Robb Bader Bremer Bank, N.A. The Ackerberg Group Technology Tip Ann Samayoa Lisa Borene M & I Bank Caribou Coffee Company The MSCA website is loaded with helpful links. If you want to David Hanson Nancy Warnen know who your political representatives are you can do it Kraus-Anderson Companies Capital Growth Madison Marquette through the MSCA website link. Click on Resources, then Industry links, select category to view State Resources, then Gary Hook Gia DesLauriers Minnesota District Finder, enter your address and up pops The Avalon Group Reliable Property Services all your representatives. Take some time to look at all the Andrew Chana Rob Stinar links we have; if you have any thoughts for additional links Marcus & Millichap Reliable Property Services please call Sean Cullen at (763) 476-6010.

msca-online.com 5 MSCA Connection Mar 08 Program Recap by David W. Stalsberg, Kraus-Anderson Companies February Retail Site Selection Professional Showcase February presenters: left to right Jim Hornecker, SUPERVALU Paula Mueller (moderator), Northtown Mall/Glimcher Properties Minneapolis/ Peter Dugan, CB Richard Ellis St. Paul Peter Dugan of CB Richard Ellis and Jim Hornecker Business of SUPERVALU refreshed and enlightened a crowd of commercial real estate professionals at the Journal DoubleTree Hotel in St. Louis Park. Dugan began by offering a fascinating characteristic of retail site The Minneapolis/St. Paul selection: its age. He explained retail site selection Business Journal is the is nothing new. It can easily be traced back to times before MNCAR, quick service single best source of restaurant concepts and big box tenants. In fact, as Dugan described, retail site selection breaking local business was as important along the Silk Road in the 13th century as it is today. news. Published every Friday in print, Hornecker complemented Dugan’s introduction by reiterating the power of site selection continuously on the Web, specific to the major grocer players and how those decisions have led to (or prevented) the Business Journal industry success over the last 20 years. Both concluded that choosing a great site is a “do or reports exclusive research die” decision for any retailer. and information on Dugan and Hornecker both reaffirmed that there is much thousands of companies more to choosing the right site than what our grandparents “There is much more in 20 key industries. Every and/or the late-night get-rich infomercial may suggest to choosing the right issue delivers Top 25 Lists, (location, location, location). In addition to isolating and new business listings, assessing a physical location, Dugan presented many site than what our people section, business aspects of site selection that must not be overlooked. He grandparents and/or calendar, bankruptcies, touched on visibility, access, density, ingress, egress, the late-night get- and more. circulation, current tenant mix, existing (or lacking) synergies, signage opportunities, etc. Further, he addressed market rich infomercial may demand, overall market expansion plans, and the suggest.” importance of assessing various intangibles as well. Dugan and Hornecker took the presentation to the next level by walking attendees through two case studies. First, Hornecker offered a detailed explanation of a hypothetical prospective Cub Foods site, Prairie Village. Not only did he indicate that Cub Foods would pass on this site, he provided a very informative explanation as to why. Second, Dugan presented a case study of market penetration for Peter’s Pizzeria*, another hypothetical concept. The aforementioned basic principles of site selection were assumed and the focus was shifted to various complex demographic analyses. In order to truly evaluate a site, Dugan explained the necessity to consider psychographics, consumption patterns, and rank order correlations, rather than merely regurgitating 1, 3, and 5-mile demographics. This will yield a much better understanding of buying behavior, whereas basic demographics will only count people.

* Brokers, please do not contact Jim or Peter regarding these case studies. Cub Foods does not have any interest in the Prairie Village site or the surrounding submarket and Peter’s Pizzeria is a fictitious concept and is not looking for space in the Southwest market. I have already tried. Bookmark Mavericks at Work: Why the Most Original Minds in Business Win by Wm. C. Taylor & Polly G. Labarre One reviewer of this book stated that the word “Maverick” is derived from Texas rancher, Sam Maverick, who allowed his unbranded cattle to roam semi- wild instead of branding them and penning them in fenced-in ranges. (Is it just me or does that sound like a leasing agent or broker to you?) The “Mavericks” referred to in this book are the original thinkers who have established successful businesses based on innovative and exciting experiments. The major goal of this book is to restore the promise of business as a force for innovation, satisfaction, and promise. This collection of case studies profiles some of the more interesting companies doing business today: Pixar, Anthropologie, Cirque de Soliel, etc. What triggered their unconventional approach to success? Contact Christopher Naumann at [email protected] or Judy Lawrence at [email protected] with your reading recommendation.

MSCA Connection Mar 08 6 msca-online.com Hot Spots / Cold Snaps by Natina James, KKE Architects, Inc.

Spend or Save: Will the Stimulus Package Help Retailers?

s the fastest way for a stimulus package to enter the upgraded ratings in the stock market. Crazily enough, UBS economy through the customer? U.S. retailers are betting Securities analyst Brian Nagle said investment prospects for the Ion it. In a letter to Bush and the Democratic and sector improved partly because valuations already imply Republican leaders of Congress, the National Retail recession.”4 Retailers with improving stocks include: Nordstroms Federation (NRF) voiced support “for quick action that would up 2.9%, Lowes 1.8%, Restoration Hardware 5.3% and Bed Bath put money back in consumers’ pockets.”1 According to the & Beyond 1.4%. Most are in agreement that there will be a NRF, consumer-spending represents 70% of the U.S. economy, boost, but full impact will be less than the total value of the and 2007 represented the slowest holiday sales since 2002. stimulus package. Consumers polled generally say they will pay down debt, but “practical experience tells us that they The $170 billion economic stimulus package passed Congress usually do just what the government wants them to: spend it.”5 in February. Most individual taxpayers will receive $600 and $1,200 for married taxpayers filing joint returns as long as their The stimulus package also includes rebates and business income does not exceed $75,000 for individual and $150,000 incentives including a doubling to $250,000 from $125,000 in for couples. There is also a $300 per child tax credit. With the amount of expenses that businesses can immediately January payrolls dropping and a decline in the service sector, write off. We know businesses will not run to hire new numerous reports are surfacing that the U.S. economy has employees based on a temporary influx of cash, but will they already slipped into a recession.2 Many economists say invest in equipment? President Bush stands firm stating, “This government action is needed to forestall or shorten a plan is robust, broad based, timely, and it will be effective.”6 recession, but some questioned whether the plan would work Retailers constantly deal with the consumers’ “perceptions” quickly enough with rebate checks not issued until spring. Two in creating a successful concept. If we have money in our camps exist: one believes that the stimulus will jolt the pocket, we generally “perceive” that we can spend it, economy; others believe when received, the economy will be regardless of our overall financial picture. Economists argue naturally heading out of a recession “thanks to several big that with the medi-care and social security crises looming, interest rate cuts by the Federal Reserve since last the government should encourage saving not spending. September.”3 That may be true, with retail shares gaining What will win out for your family? Will you spend or save?

1 & 4 MarketWatch, Jan.18, 2008 – “Stimulus package hope bolsters retail sector” 5 All Business, Feb.12, 2008 – “How much will the Economic Stimulus Package Help You?” 2 & 3 CNN Money, Feb.11, 2008 – “Bush to sign stimulus package Wednesday” 6 New York Times, Feb.8, 2008 – “Congress Votes for a Stimulus of $168 Billion”

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