Sales tax, other deals help draw re­tail to By­pass

Manteca Bulletin - - Front Page - By DEN­NIS WYATT

Three of the four big­gest re­tail­ers when 2019 rolls around along the 120 By­pass will have been snared with the help of sales tax shar­ing deals aimed at pre­vent­ing re­gional re­tail­ers that draw from a 20 to 100 mile ra­dius from lo­cat­ing in Lathrop, Tracy, Modesto, or Stock­ton.

The lat­est deal was unan­i­mously ap­proved Tues­day by the Man­teca City Coun­cil to se­cure a 130,000-square-foot Liv­ing Spa­ces Fur­ni­ture show­room and ware­house along the ex­ten­sion of Ather­ton Drive that is now un­der con­struc­tion south­west of the Union Road and 120 By­pass in­ter­change.

Mayor Steve DeBrum noted the deal

al­lowed Man­teca to beat a neigh­bor­ing city in land­ing the fur­ni­ture re­tailer whose rep­re­sen­ta­tives say they draw from a 50-mile ra­dius. That means Man­teca — based on pro­jected an­nual sales of $35 mil­lion — will end up split­ting an es­ti­mated $350,000 in lo­cal sales tax. The deal call for the split to be 50-50 of what­ever is ac­tu­ally gen­er­ated — whether it is an­nu­ally higher or lower than $350,000 for 10 years or $3 mil­lion, whichever is reached first.

Based on the pro­jec­tions, Man­teca while the split is in ef­fect would re­ceive $175,000 in gen­eral fund sales tax, $20,000 in prop­erty tax, and $175,000 in re­stricted Mea­sure M pub­lic safety tax. Man­teca’s lead­ers point out the $370,000 a year the city will re­ceive while the terms of the split are in ef­fect is $375,000 that would have been lost to an­other city. Af­ter the terms are ful­filled, Man­teca would re­ceive all of the sales tax.

It is some­what dif­fer­ent than a sales tax split deal with Costco ex­pected to be done by 2020 that cov­ered the en­tire tab for the whole­sale re­tailer’s cost of build­ing a store in Man­teca. The deal that brought Bass Pro Shops — a re­tailer with a 100-mile re­gional draw — to Man­teca was ac­tu­ally made with the de­vel­oper of The Prom­e­nade Shops at Or­chard Val­ley. It is a 35-year sales tax split capped at $35 mil­lion. How­ever, if the cen­ter doesn’t gen­er­ate that much through the split af­ter 35 years, the city is not ob­li­gated to make up the dif­fer­ence.

While they did not get a sales tax deal, rare is any re­tailer or ser­vice along the 120 By­pass that didn’t ben­e­fit di­rectly or in­di­rectly from some type of city in­vest­ment re­lated di­rectly to the de­vel­op­ment of their site.

Re­de­vel­op­ment agency funds made it pos­si­ble for the de­vel­oper of the Mis­sion Ridge Shop­ping Cen­ter an­chored by Wal­mart and Safe­way to se­cure needed land. Wal­mart — along with Costco and Bass Pro Shops — are ex­pected to be the three largest gen­er­a­tors of sales tax along the 120 By­pass by the end of 2019.

The RDA put in place the $10 mil­lion plus ex­ten­sion of Daniels Street west of Air­port Way and needed in­fras­truc­ture that al­lowed the Sta­dium Re­tail Cen­ter an­chored by Kohl’s to be built.

The Or­chard Val­ley sales split es­sen­tially paved the way for JC Pen­ney and other con­cerns in that cen­ter.

The only busi­nesses along the 120 By­pass that did not re­ceive di­rect or in­di­rect municipal as­sis­tance are Siz­zler’s, McDon­ald’s, AM/PM Arco sta­tion, and the new gas sta­tion/con­ve­nience store be­ing built on the south­east side of the Main Street/120 By­pass in­ter­change.

Great Wolf Lodge — a 500room re­sort and in­door wa­ter park ex­pected to break ground this sum­mer west of Costco — was snared with a 25-year hotel room tax split.

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