Milpitas council approves tax‑sharing deal with Rivian for last‑mile hub at 755 Yosemite Drive

Milpitas — The City Council voted unanimously March 4 to adopt a resolution approving an economic development incentive agreement with Rivian LLC that will allow the electric‑vehicle maker to operate a last‑mile hub at 755 Yosemite Drive.

The measure, introduced by Director of Economic Development and Strategic Initiatives Alex Andrade, formalizes an eight‑year tax‑sharing arrangement the staff negotiators said would send an estimated $19.4 million in sales‑tax receipts to the city over the life of the agreement, with Rivian receiving roughly $16.2 million under the projection. Andrade told the council the point‑of‑sale designation for deliveries at the Yosemite Drive site is a critical part of the agreement.

The agreement, as described to council, includes a stepped split of the city’s share of point‑of‑sale tax revenue: years one and two would give Rivian 35% and the city 65%; years four through eight would convert to a 50/50 split. City staff and Rivian presented volume assumptions that start with about 6,000 vehicle sales or leases annually in years one and two and increase to roughly 10,000 annually beginning in year three, the presentation said.

Rivian representatives told the council the Milpitas site would be a Last Mile Hub for service, delivery and limited showroom and leasing activities. Hannah Steinwag, introduced as Rivian’s policy and regulatory lead for the western U.S., said the project fits Rivian’s strategy to support Northern California customers and to expand its service and delivery network. “Our mission is to keep the world adventures forever,” Steinwag said in remarks to council during the presentation.

Lucas Stobbins, listed as Rivian’s senior real estate lead, said the company already operates service centers and showrooms in California and confirmed the proposed Milpitas facility would include a 4,000–5,000 square‑foot front‑of‑house area for customer pickup and limited display. Rivian staff described plans for on‑site Level 2 and a small number of DC fast chargers primarily for delivery and service vehicles; they also said Rivian trains local fire departments on EV battery fire response at sites where it operates.

City staff emphasized the agreement does not grant any permits or entitle Rivian to building approvals; Rivian remains responsible for obtaining required land use and building permits, and the planning director said primary auto storage and repair uses are permitted in the property’s M‑2 heavy industrial zoning. Staff also noted the agreement requires reporting under Government Code Section 53083 and that the city posted an economic development subsidy report on Feb. 21, 2025 as required by state law.

Public comment included support from residents and from a local technology and transportation analyst, Michael Tsai, who urged the council to welcome high‑tech and EV businesses while remaining agnostic between manufacturers.

Councilmember Evelyn Chua moved to conduct the public hearing and adopt the resolution approving the economic development incentive agreement; Vice Mayor Barbara Barbadillo seconded. The council recorded a unanimous vote of approval.

The agreement sets an initial eight‑year term beginning in early 2026; the property owner may later exercise a five‑year option that would allow the parties to negotiate an extension. Staff described default and termination provisions that would allow the city to cease the sales‑tax sharing if Rivian discontinues taxable business activities at the site. The final executed agreement and the city’s economic development subsidy report will remain posted with the city’s public records.

What’s next: staff said construction drawings are at about 75% and planning, building, fire prevention and environmental health are coordinating with Rivian. The council did not adopt any land use entitlements as part of the incentive resolution; any permits required for construction and operation must be obtained through the city’s normal review process.

Votes at a glance: - Resolution approving economic development incentive agreement with Rivian LLC for operation of a last‑mile hub at 755 Yosemite Drive — Moved: Councilmember Evelyn Chua; Second: Vice Mayor Barbara Barbadillo; Outcome: Approved, unanimous.