Iowa City and Coralville are both financially stable and have low unemployment.
But leaders in Iowa City say Von Maur's closure will be devastating for Sycamore Mall, where a number of other stores have closed in recent weeks. A spokeswoman for Von Maur, a Davenport, Iowa-based chain, declined to comment.
Elected officials in Coralville, a relatively wealthy city of 19,000 with big box stores and affluent neighborhoods straddling Interstate 80, aren't backing down. They say they went after Von Maur only after learning its Iowa City location was struggling and was considering moving.
Coralville Mayor Jim Fausett said the development that will house Von Maur will transform what once was an industrial wasteland into a destination for shoppers. He credited the deal with helping persuade a brewpub to open nearby and drawing interest from other restaurants. New businesses could eventually mean hundreds more jobs in the retail, service and construction industries.
"It's finally now starting to really move forward," he said. "We think it's the right development for the area."
This story is the latest installment in a joint initiative by The Associated Press and Associated Press Media Editors on the fiscal crisis facing U.S. states and cities, how state and local governments are dealing with severe budget cuts, and how American lives will change because of them.
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