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COUNCIL COMMUNICATION Meeting Date: Agenda Item: Agenda Location: Work Plan # Legal Review: St 1 Reading November 10, 2016 Action Items 2Nd Reading

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COUNCIL COMMUNICATION Meeting Date: Agenda Item: Agenda Location: Work Plan # Legal Review: St 1 Reading November 10, 2016 Action Items 2Nd Reading COUNCIL COMMUNICATION Meeting Date: Agenda Item: Agenda Location: Work Plan # Legal Review: st 1 Reading November 10, 2016 Action Items nd 2 Reading Subject: A resolution approving an agreement for Economic Development Incentives between the City of Thornton and Dillon Companies, Inc., a Kansas Corporation DBA King Soopers. Recommended by: John Cody Approved by: Jack Ethredge Ordinance previously introduced by: Presenter(s): Julie Jacoby, Retail Administrator SYNOPSIS: Dillon Companies, Inc. intends to spend approximately $28 million to develop a 125,000 sq. ft. King Soopers Marketplace store located on the southwest corner of Quebec and 136th Avenue. The King Soopers Marketplace is an expanded store concept, selling groceries and household items, in addition to offering an expanded deli and bigger selections of organic and natural products. The overall project would be anchored by King Soopers Marketplace and include a King Soopers gas station and four to five retail pad sites for additional development. Dillon Companies, Inc. is requesting $3,000,000 in economic development incentives to assist in development of the project. RECOMMENDATION: Staff recommends Alternative No. 1, approval of the incentive agreement because the development serves a public purpose by virtue of bringing needed services to a rapidly developing and underserved area of Thornton, the creation of new employment opportunities, enhancement of the City’s tax base, increased customer base, and increased retail products and services. BUDGET/STAFF IMPLICATIONS: The incentive would be a 50/50 sales tax sharing incentive of eligible sales tax revenues (Open Space taxes excluded) collected from King Soopers Marketplace for five years, not to exceed $3,000,000. ALTERNATIVES: 1. Approve the incentive agreement for a 50/50 sales tax sharing incentive agreement of new sales tax collected, not to exceed $3 million. 2. Do not approve the incentive agreement. BACKGROUND (ANALYSIS/NEXT STEPS/HISTORY): (includes previous City Council action) Dillon Companies, Inc. is a Kansas corporation doing business as King Soopers. COUNCIL COMMUNICATION PAGE 2 In addition to King Soopers grocery offerings, they also offer casual clothing; footwear; housewares; kitchen and small appliances; home decor items; soft goods; and jewelry in a separate Fred Meyer Jewelers inside the store. The marketplace concept is designed to offer convenience and variety to customers. Around the world Kroger employs more than 375,000 associates who serve customers in 2,640 supermarkets and multi-department stores in 34 states and the District of Columbia under two dozen local banner names including Kroger, City Market, Dillons, Food 4 Less, Fred Meyer, Fry's, Harris Teeter, Jay C, King Soopers, QFC, Ralphs, and Smith's. R E S O L U T I O N A RESOLUTION APPROVING AN AGREEMENT FOR ECONOMIC DEVELOPMENT INCENTIVES BETWEEN THE CITY OF THORNTON AND DILLON COMPANIES, INC, A KANSAS CORPORATION DBA KING SOOPERS. WHEREAS, the City has determined that stimulating economic development and employment opportunities and establishing a sound tax base serves the general welfare of the residents of Thornton; and WHEREAS, Dillon Companies, Inc. intends to purchase approximately 20 acres of land (the “Property”) and cause to be constructed and operated an approximately 125,000 square foot King Soopers Marketplace combination food and drug store (the “King Soopers Marketplace), a fuel center, adjoining retail of approximately 8,000 square feet and outlots at the southwest corner of Quebec Street and 136th Avenue, which grocery store is anticipated to be developed and operated in a manner generally consistent with the King Soopers Marketplace stores located in Commerce City, Brighton, and Arvada, Colorado; and WHEREAS, the Property is currently zoned within the City of Thornton Community Retail District which permits, among other uses, a combination food and drug store and fuel center; and WHEREAS, Dillon Companies, Inc. intends to invest over $28 million to develop the King Soopers Marketplace; and WHEREAS, the City desires to offer certain economic development incentives to Dillon Companies, Inc. as an inducement to develop King Soopers Marketplace as shown in the attached Exhibit A; and WHEREAS, the City has determined that the development of the King Soopers Marketplace has a public purpose by virtue of additional services for the residents, the creation of new employment opportunities, enhancement of the City's tax base, increased customer base, and increased retail products and services. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF THORNTON, COLORADO, AS FOLLOWS: The Agreement between Dillon Companies, Inc. and the City of Thornton, which is attached hereto as Exhibit A, is hereby approved and the City Manager is hereby authorized to execute, and the City Clerk to attest the Agreement. PASSED AND ADOPTED at a regular meeting of the City Council of the City of Thornton, Colorado, on , 2016. CITY OF THORNTON, COLORADO Heidi K. Williams, Mayor ATTEST: Nancy A. Vincent, City Clerk 2 .
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