City Fills Its Own Little Niche With Big Stores : Retail: Sports Authority will become the seventh mega-store in Fountain Valley, which has been shielded from sales tax slumps that have plagued other towns.

A shopping mall wasn’t likely--neighboring cities had already captured the marketplace. Auto dealerships also weren’t practical--such businesses abound on nearby Harbor and Beach boulevards.

“We were not looking to create another strip center. We were looking for creative projects for what pieces of land were left,” said Laurann Cook, a Fountain Valley councilwoman.

“There was no way to compete with the shopping centers, so we asked, ‘What’s our niche in the marketplace?’ ” City Manager Raymond H. Kromer said.

The city found its answer in mega-stores, those warehouse-like buildings with concrete floors, do-it-yourself service and discounted prices. The large, high-volume discount retailers proved to be the cure for slumping sales-tax revenues.

Three years ago, Fountain Valley landed Price Club, persuading company officials that their location would be better than one in Santa Ana. Today, the city has five other high-volume retailers: Pace Membership Warehouse, Home Base, Auto Parts Club, Staples and Comp USA.

Now a seventh store is on its way. The Sports Authority, a sports mart, is scheduled to open in mid-November, next door to Price Club at Newhope Street and Talbert Avenue.

“Obviously it’s going to be a boost in sales tax, and it gives us a broader spectrum of a sales-tax base,” Kromer said.

Other Orange County cities have been forced to cut budgets because of declines in sales-tax revenue during the recession, as well as loss of state funding. But Fountain Valley, Kromer said, has managed to increase its revenue base.

“The high-volume discount retailers appeared to have fared well through the recession,” he said.

The city generates about $6.5 million in annual sales-tax revenues from all retail businesses, Kromer said. “That’s why we find it important for taxpayers to support local businesses and keep tax dollars here.”

And the high-volume retailers, Kromer said, not only keep local dollars at home, they also attract shoppers from adjacent cities.

Sports Authority, owned by K mart Corp., has 56 stores nationwide. The Fountain Valley store, situated on 30 acres, is the chain’s first in California.

The $5-million, 43,000-square-foot store will generate 100 jobs, said Arnie Sedel, Sports Authority’s senior vice president of operations.

Fountain Valley was selected, Sedel said, because of its location and the customer base that already exists because of the other high-volume retailers.

“We have been very successful when we team up with the Price Club,” Sedel said.

City officials see a bright future in Fountain Valley’s growing number of discount stores.

“We’re like the ‘in’ place to go,” Mayor James Petrikin said. “We draw people from area cities to come to these places and, since we’re centrally located, it’s turned out to be an asset for us.”