Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Economic Development topic
No spam. Unsubscribe anytime.
Council approves amended $550,000 subsidy term sheet for UG2 Tulare to support infrastructure for Maverik and Chick-fil-A
Summary
The Tulare City Council approved an amended economic-development subsidy Jan. 7 that raises the citys commitment to UG2 Tulare LLC from $200,000 to $550,000 to help cover newly revealed utility and gas-line costs for a commercial project at Cartmill Road and Highway 99.
The Tulare City Council on Jan. 7 approved an amendment to an economic-development subsidy term sheet with UG2 Tulare LLC increasing the previously approved subsidy from $200,000 to $550,000 to offset higher infrastructure costs, including gas-line and electric utility installation required to serve six acres at the southeast corner of Cartmill Road and Highway 99 (item 7.2).
Tracy Myers (staff) told council the earlier $200,000 subsidy was based on increased costs tied to a required gas-line extension. Since then, staff said, the California Public Utilities Commission approved a change affecting mixed-fuel electric line extensions (effective July 1, 2024) that added about $580,000 in costs to the developer. UG2 sought an additional subsidy; staff recommended amending the prior term sheet to combine the $200,000 already committed with an additional $350,000 to create a $550,000 subsidy that will be reimbursed from the sales tax generated by the development.
Staff explained the city's sales-tax consultant estimates Maverik (the larger commercial anchor) will generate roughly $100,000–$170,000 in city sales tax annually; quick-service restaurants such as Chick-fil-A typically yield roughly $10,000–$17,000 in city sales tax. For that reason, staff and the developer agreed that repayment from combined project sales-tax receipts would be structured so reimbursement would not begin until Maverik and Chick-fil-A are operational and the city begins to receive sales tax from the sites.
Council clarified the amended subsidy does not affect a separate $200,000 subsidy previously approved for Cartmill Commons; that earlier agreement remains unchanged. Staff also clarified that the infrastructure work will benefit development across the 22-acre project area (Maverik, Chick-fil-A and future pads) but not properties off the site.
Council voted to approve the amended term sheet; the motion passed unanimously.
