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Council approves Chapter 380 incentive for Chipotle at Fairmont Pkwy and SH‑146; agreement ties payments to sales and performance
Summary
The City Council approved a Chapter 380 incentive agreement for a Chipotle at West Fairmont Parkway and State Highway 146 that ties grant payments to documented capital investment and site sales.
The La Porte City Council approved a Chapter 380 economic development agreement with Edifice La Porte LLC to support construction of a Chipotle at the northeast corner of West Fairmont Parkway and State Highway 146.
City staff described the revised incentive after the developer shifted the project scope; only Chipotle had signed as a tenant when the agreement was negotiated. Staff said the developer must provide documentation verifying a minimum capital investment of $2,000,000 and obtain a certificate of occupancy to receive grant payments. "The developer must obtain a certificate of occupancy for the building. The developer must provide documentation verifying a minimum capital investment of $2,000,000," a staff presenter said during the discussion.
Under the adopted terms, the city will make grant payments equal to 50 percent of the city's portion of sales taxes generated at the site, up to $35,000 per year for a maximum of three years (maximum total $105,000). The city will also reimburse development and permit fees up to $12,000 separately. Staff explained that to qualify for the full $35,000 in any single year the Chipotle would need to generate $3,500,000 in taxable sales; lower taxable sales yield proportionally smaller reimbursements.
Councilmembers questioned whether the city could be left holding a vacant pad if a tenant failed to build — referencing a prior El Toro project where the assemblage left a visible pad. Staff said the agreement is performance‑based: reimbursements are tied to delivered work and sales, so the city would not pay incentives if the project does not perform. "We wouldn't be out any money, but if they were to take the same path that El Toro took and build a pad... we don't have any recourse to get that removed," staff said, noting the city is protected from unrecovered cash outlay though not from leftover site improvements.
Councilmember Engelkin moved to accept the Chapter 380 agreement as presented; Councilmember Williams seconded. The motion carried on a council voice vote.
