Elk Grove City Council Approves Tax Incentive For Planned Costco
ELK GROVE (CBS13) - The city council unanimously approved an $8 million tax incentive to Costco to continue the plans to build on Bruceville Road and Elk Grove Boulevard.
It won't cost citizens up front, but once the store is in motion, the city will split the sales tax with Costco until it reaches $8 million or the contract ends after 25 years.
"From my standpoint it's a no-brainer," said Darrell Doan, the City's economic development director.
He believes it's still a major revenue for the city.
"Costco is one of the biggest retailers in the country and they will produce a very large and steady stream of revenue for the city -- even after we rebate taxes back to the landowner," he said.
Some residents were all about a Costco moving into the lot, but with the additional cost, they're completely against it.
"I think if you want to put a business here we shouldn't have to pay you, and I think it sets a bad precedent because people say, 'Well, I want to be paid too,'" said Linda Vanterpool of Elk Grove.
Even though it comes at an even higher cost than expected, some still want it.
"Right now we either have to go to the one on Stockton Boulevard or Cal Expo or the nice one in Roseville. All of that revenue could be in Elk Grove, but right now we have it to give to Sacramento," said Amanda Hall of Elk Grove.
According to a staff report, the city would receive $27 million in sales tax over 25 years after the $8 million in incentives is paid out.
The developer said they found another location in Sacramento, which would've meant Elk Grove would miss out on the revenue all together.
The plan is to break ground this year and be open by 2018.
