Milpitas City Council approves economic development agreement with Rivian LLC

The City of Milpitas held a City Council meeting on March 5, 2025, primarily focused on an economic development incentive agreement with Rivian LLC for the operation of an industrial facility at 755 Yosemite Drive. The meeting commenced with a presentation by Alex Andrade, the city's Director of Economic Development and Strategic Initiatives, who emphasized the potential benefits of this partnership, including substantial revenue generation and job creation for the community.

Andrade outlined the key aspects of the proposed agreement, which includes a tax sharing arrangement where Rivian would receive 65% of the sales tax revenues generated from the site for the first three years, transitioning to a 50-50 split for the subsequent five years. The estimated total revenue over the eight-year term is projected to be approximately $35.5 million, with the city expected to receive around $19.4 million.

Rivian, an American electric vehicle manufacturer, plans to establish a "Last Mile Hub" at the site, which will serve as a center for service and delivery operations. The facility is expected to create at least 25 jobs initially, with the potential for further employment growth as operations expand. Rivian representatives highlighted their commitment to sustainability and innovation, noting their existing partnerships with major companies like Amazon and Volkswagen.

During the public comment section, community members expressed support for the agreement, emphasizing the importance of attracting high-tech businesses to Milpitas. Questions from council members focused on the specifics of the agreement, including the anticipated impact on local sales tax revenue and Rivian's plans for charging infrastructure in the area.

The council ultimately conducted a public hearing as required by state law and moved forward with the recommendation to adopt the resolution approving the economic development incentive agreement with Rivian. This partnership is seen as a significant step towards enhancing the city's economic landscape and supporting the transition to electric vehicles. The meeting concluded with a commitment to continue collaboration between the city and Rivian as they work towards finalizing the agreement and initiating operations at the new facility.