Council discusses potential sale of property
Site could sell for $1.4M-plus
During its final work session of 2016, the Yuma City Council discussed the sale of a 17-acre property that is likely to be sold for more than $1.4 million to ST Partners, LLC to build a food processing facility.
ST Partners, based in Gainesville, Georgia, is the company behind Almark Foods, which manufactures various egg products.
Their plans for the property, located at the northwest corner of Avenue 4½ E and 36th Street, include a 120,000-square-foot plant that would create 100 fulltime, non-seasonal jobs, generating a $2.8 million annual payroll and more than half a million in sales and property taxes in its first five years of operation.
The prospective buyer will give a presentation to council before the body votes during its regular meeting at 5:30 p.m. Wednesday in council chambers at City Hall, 1 City Plaza.
The sale agreement for the property includes waiving up to $85,000 of the fees for a plan review, permitting and development fees for the build, provided that construction commences within one year of the agreement date.
Council member Gary Wright asked about the criteria used to waive fees.
“A while back, we developed kind of an informal economic development policy of what we will provide incentives for,” City Administrator Greg Wilkinson told the council. “In addition to that, we also go out for a formal economic analysis of what we can and can’t (offer).”
Wilkinson said that the analysis is based on the company’s investment, payroll, jobs and job salary, among others.
The projected capital investment cost for this project will be $27.5 million, according to the city — “for land purchase, construction of the building and installation of equipment.”
Wright also inquired whether or not the fees could be waived for companies that planned to build on private property that had nothing to do with the city.
Wilkinson said that incentives are given “on a case-by-case basis,” regardless of who owns or sells the property. He cited Johnson Controls, Alside Window Company and Convey Health Solutions as three that had received incentives.
As part of its economic development agreement with ST Partners, the city will also refund up to $127,500 in construction taxes if they provide documentation showing the amount of the 1.7 percent sales tax paid to the city in connection with the construction of the plant.
During the brief discussion, council member Gary Knight mentioned that the incentive is only if the purchases are with local vendors — since it has to be in conjunction with the city’s sales tax.
“The only way they’re going to get that is to buy from our local merchants and suppliers,” he said.
Mayor Doug Nicholls concluded the conversation by noting that the city’s partnership with the Greater Yuma Economic Development Corporation helped make the job-creating project possible.
The council also discussed the city’s intention to join Tucson in a lawsuit against the state over Senate Bill 1487, which requires Arizona’s attorney general, upon the request of any state legislator, to investigate municipal ordinances that may violate state law.
The city contends that the law “sets a dangerous precedent” regarding due process and it has been called unconstitutional.
Responding to a question from Deputy Mayor Bill Craft, the city administrator said that he believes other cities will also be involved in the lawsuit.
SB 1487 would allow the state to withhold stateshared revenue funds if a city were found to be in violation by the attorney general.
Mayor Nicholls said the city, if council approves the recommendation to move forward with the lawsuit, is not necessarily supporting the action that Tucson is particularly suing for, but as part of “a constitutional challenge of the bill itself.”
“The ability for one legislator to make an accusation against a city, and the attorney general to solely act to begin the process of sweeping state-shared revenues is lopsided,” he said. “It doesn’t reflect the normal balance of power in our three branches of government — it feels unconstitutional.”
Council member Edward Thomas stated he believes that “the state would be better served if they were to go after the sanctuary cities.”
Council member Knight called the Senate bill a “gross overreach by the state.”
SB 1487 was sponsored by Republican Andy Biggs of Arizona’s 5th District and signed into law in March by Gov. Doug Ducey.