Council approves plan to entice new industry
by Denise Ellen Rizzo / Tracy Press
Dec 23, 2011 | 4159 views | 23 23 comments | 12 12 recommendations | email to a friend | print
A special City Council meeting was convened Wednesday night to approve a plan to allow city staff to entice new office and industrial businesses to Tracy through a special incentive program.

According to Development Services Director Andrew Malik, the program would target developers and or prospective tenants that meet specific criteria, including annual gross sales of $100 million or more; generate sales or use tax to the city corresponding to the gross sales; and providing a minimum of 1,000 full-time-equivalent jobs.

Malik told the council the program was another piece of the city’s overall economic strategy, with a primary goal of creating more local jobs. He described it as something similar to the Tracy Mall Revitalization Program passed in May 2010, a policy that brought Macy’s to the West Valley Mall.

He said under the new proposed program, businesses could be enticed through such financial incentives as a sales or use tax rebate, or direct financial assistance tied to future sales and use tax generation.

In order to attract businesses, Malik said the city needed to have a few things already in place, such as available land or office space, offer competitive permit fees, and provide an attractive labor force.

“We will continue our efforts to make sure Tracy is a model for the region,” he said.

The council passed the program with a 4-0 vote in the absence of Mayor Brent Ives, but some members voiced their desire to attract businesses that provide higher salaries for Tracy residents.

“My concern is more jobs, but low wages,” Councilman Robert Rickman said. “The goal is to work in Tracy and shop in Tracy. When you seek retail businesses, don’t settle. Try to get something big,” he said, comparing Manteca’s version of JCPenny to Tracy’s smaller retail version.

Rickman also stressed that he wanted to see businesses that cater to Tracy’s younger population, such as Chuck E Cheese’s. He said he didn’t want to see more warehouse businesses.

Malik said the plan passed Wednesday has in mind companies such as high-tech manufacturers and distribution centers with an office base, with jobs that provide a starting pay of $15 to $18 per hour.

Councilman Bob Elliott and Mayor Pro Tem Mike Maciel both spoke in favor of the program. Elliott said, “We see the value of Macys. This shows the value of what we can do to attract high-end business.”

Maciel said that there has been talk for a long time of creating more local jobs. He said this program shows that the city not only talks the talk, but walks the walk.

Although no city officials would say there was a specific business waiting in the wings that met the new program’s criteria, City Manager Leon Churchill said via email this week that there was a need to get the plan approved now, as opposed to waiting for the next council meeting Jan. 3.

Comments
(23)
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TomBenigno
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December 26, 2011
Seedym:

Giving the 49ers the land sounds like a better plan than giving the land to the railroad to build a container station or a Flying J truckstop.

What about a college?
TomBenigno
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December 25, 2011
Seedym:

What about congressional race? The third time might be the charm. As for giving the railroad, the old Alvarez ranch to the rail system, that's your nightmare.
seedym
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December 24, 2011
Tom Benigno:

While your dreaming dumb, how about you dreaming being elected to a County or State.

seedym
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December 24, 2011
you are, sorry I was laughing to hard to think.
TomBenigno
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December 24, 2011
Dreamers:

My comments about giving the land to the 49ers to build a stadium is about as dumb as giving the land to the railroad to build a hub for containers. The darn railroads who we subsidize own half the country hauling the junk to the U.S.from other countries to sell in our stores that we subsidize.!! Now that is a dumb dream.
Sneaky
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December 24, 2011
If we are going to engage in fantastical dreaming I would much rather have a Nascar track, dragstrip and roadcourse than some silly ball park.
TomBenigno
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December 24, 2011
Seedym:

Rather than build another Port of Oakland, why not give the land to the 49ers for a new ballpark. Then we can all go to the games, without traveling 80 miles.!! Plus we can go downtown and spend some money, thus creating economic developement for Tracy. We then can hire another 200 policeman to keep the thugs out of the ball park. That will also allow more people to come to Tracy to buy Serpas and Souza houses. That way we can all have a Merry Christmas every year.
monsterdad3k
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December 23, 2011
They already have something similar to Safeway warehouse out there, it's called the Costco warehouse.
ChrisRoberts
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December 24, 2011
And it is sitting in the county, outside of Tracy limits, providing us with no tax revenue. So I'm not sure what the point of that was. We are trying to bring stuff into Tracy, not 3 miles outside of town in a cow pasture that will later become annexed by Mountain House.
ChrisRoberts
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December 23, 2011
Tracy is not high end. It never has been and it never will be. We are a working to middle class town with a few spots of poverty and a few spots of well to do.

We need to be attracting bay area wearhousing. Convince them that after the goods come thru the port of Oakland it is more more practical to save money and set up shop in Tracy before the goods go out of state. Imagine if Tracy had a UPS or Fed EX hub or something similar to the Safeway wearhouse out on mountainhouse parkway.

What we need to avoid is stuff like that Winco disaster. They hyped up how they were gonna do this and that and then they let everyone go to keep the work force at a bare minimum.
pinnicle
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December 23, 2011
Why do we need FedEx. Safeway and many others have been there for years. Ups and FedEx distributions would just bring a more pollution than we already have and more congestion on Interstate 205. Warehouses don't bring a lot of tax revenue anyway.

When a store like Winco opens they hire a lot of people to handle the flood of people who were there for all the freebies. It's not the end of the world.

A starting pay of $15 to $18 dollars per hour with a six percent increase per year is not a bad idea. It would keep hundreds of these punks out of the gangbanging franchise and add a second income for many families who just might NEED it at a timely juncture.
seedym
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December 24, 2011
Tracy should consider giving the 112 acres at Chrisman Rd. and 11th Street to the port of Oakland or Union Pacific as incentive to build a hub for cargo containers. Save a couple of acres and give to a Flying "J" or other Truck friendly operation. Once built, this could reduce truck traffic on I580 15% to 20% improving commute time. Most in not all trucks would leave the site heading east or south of town, reducing traffic on I205. Jobs created would be blue collar high-paying long-shoreman, teamsters and railroad plus truck service and maintenance. The site could be a main distribution point of offloaded cargo containers brought to Tracy by train. This would help decrease the congestion at the Port of Oakland and reduce truck traffic through Tracy, plus create a bet of tax revenue for Tracy.
doors17
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December 23, 2011
While I applaud the effort and hope the plan succeeds, I fear the biggest obstacle is that Tracy is considered undesirable by upper management who base their location on where they live. They don't mind us making the trip over the hill each day, but if they can personally avoid it, that's priority one for them and unfortunately the realty for us.

I've been working at the same software company since 1988, this past June our CEO announced that we are moving from off Greenville Rd in Livermore to Dublin off Santa Rita Rd. There was a collective groan from the majority of us since for about the 75% of us who live on the Tracy side of the hill this added eight to nine miles one way will add about 30 to 45 minutes to our morning commute, in the heavy traffic that I'm sure many of you are familiar with.

When we asked our CEO if Tracy was ever considered, he looked at us as if he was saying, what are you high? He said no, we will never be moving to Tracy with a tone in his voice saying, you've got to be kidding.
behonestguys
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December 23, 2011
I agree with you doors17. In order to attract CEOs of high quality companies to our city, you have to have high-end, executive type housing that the CEOs and their families would be willing to live in. Even though Redbridge and Eastlake are considered as very desirable to live in, at the end of the day, they are still subdivisions, not exactly the type of places a Larry Ellison or folks of that ilk would want to move into.

newtotracy
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December 23, 2011
I agree with you too Doors...but sadly, even if we build swanky houses...very few CEO's will move here. I grew up in the mid-Peninsula...I know these people. It's not the house per se...it's the address. Tracy is nothing more than a gas or bathroom or In-N-Out stop on the way to the ski cabin. They want to live in Los Altos Hills, Atherton, Woodside...not Tracy. Ruby Hill has done ok, but we aren't going to be able to replicate that...it's just not realistic.

I say we embrace who we are...which is GOOD solid working people. We don't mind putting up with the heat and the "rural" atmosphere for a great quality of life...and if that means a hike over the hill it's just a necessary evil.

I'd love to see internet jobs come here, but aside from a support center or some little start-ups...as someone in the industry, I just don't see it happening. The swank airs aren't in Tracy...and nobody gives a rip about price when you can have a "hip SOMA loft office" to lure in employees. If my little one-person company needed an office...you bet I'd locate here. But I'm not the norm...

$15-18/hr jobs is better, but city jobs pay more. eBay Support paid that in 1999 in San Jose!
Sneaky
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December 23, 2011
I was about to say something along those lines too. $16 an hour was what I was making in a zero skills union labor job back in the early 90s.
pinnicle
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December 23, 2011
The biggest reason that companies don't want to relocate to Tracy has nothing to do with our managers living in Palo Alto or San Francisco. It has more to do with our distance from the Silicon Valley, transportation, other jobs that support a big business, and executive homes at over 6000 square feet, golf cart parking, and within the city limits, and with a playground for a yard. Essentially a McMansion.

$16 dollars an hour is what many people started at during the last recession. They are now making much more. In ten years someone who started at $16 dollars could be making as much as $26 dollar a year. Actually I doubled that in less than five years because I was a fast learner.

And for doors17 - due to the anti-development weenies, if an executive wanted to "plug and play" in Tracy, Mountain House, Lathrop, or Patterson she would have to move outside the city limits and build a custom home.

All of the complaints are purely ignorant and based on fear of the unknown. I agree with what they are doing. Especially after they are already building the Gateway Business Park. This makes perfect sense, but whenever there is change people will always make excuses to stay in ignorance and in the past. In other words, people will always resist improvement, even if it is for their own good.

The conundrum is further expanded upon by looking at Macys. Anytime they promote business like Macys (for example) people complain that it's not good enough for them because it is too small or it is not JCP or (insert favorite store here). Or it's not Microsoft, etc, etc, etc. Bottom line is this. Whenever the people we elected to office promote realistic businesses ventures, this is exactly the types of complaints you will always hear. Because people are afraid of new change, even when the change is going to be good for us all and other businesses will also benefit from it.

Thus is the circle of life, but if all we do is sit around and complain then nothing will ever get done. Therefore, I embrace change. But that's just the way I roll.
Sneaky
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December 23, 2011
I am glad to see they are at least aiming a bit higher than retail. Its a step in the right direction. That said, they are still setting a pretty low bar. Many of us who go over the hill into the bay area for engineering and management jobs make 2 or 3 times that $15-18/hour.
newtotracy
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December 23, 2011
$16/hr is less than $35k a year full-time. If you have a family, that's just not reasonable. Heck...if you are single it's not very reasonable! Even without my debts (like student loans)...I'd be hard pressed to pay rent and food and utilities out of approximately $1600 a month. And I don't spend a lot!

Jobs at that pay rate are customer support positions...which I'd love to see here (like Restoration Hardware) but they aren't "the" jobs in the internet world.

We need to get a mix of the "blue collar" type of jobs (warehouse, assembly, customer support centers) in to provide higher pay...then a mix of retail/restaurant (good stores, D&B, etc) in to entertain those folks and their families.

We have a demographic of people here who need jobs but may not have technical skills. They can bust their butts to work, but they may not know how to code or even how to use Excel. Let's get those folks working...then when Tracy is suddenly this nice little mecca of working folks...we try to entice some of those internet companies paying top dollar in the Bay Area over here where a large percentage of their employees commute from. By the time that happens...it might just be that satellite offices are THE thing!

Right now, too many internet CEO's are thinking with their heads up their...well you know! Telecommuting or satellite offices aren't yet acceptable to a lot of them (because they don't have to deal with 580!!!)...that's starting to change. Once it does...then, and really only then, will towns like Tracy see potential for some great internet business!

I've said it before...I'll say it again. We're in a prime wind and sun area...let's get some greentech in here and change the way we power our world! (just not Solyndra...they kinda stank the joint up!) SunPower just bought a French solar company for $165 million. They already have an office in Roseville (Sacto branch) and are based in San Jose...how about some lower Valley coverage guys?? I'll provide a "test roof!"

Naysayers will deny that changes are coming, but there's only so much oil out there...and nuclear has the same issue...you just can't create the oil or uranium so well...but solar and wind are limitless and pretty danged cheap (it's just the technology that costs and that's coming down too!). Let's help lead the way...put Tracy on the map for being a welcoming town and a major factor in the power source of the future!
walkingtall
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December 23, 2011
Wow! I am stunned that it passed! Just kidding! Of course it was going to pass that is why they set up this special meeting so they could pass it! The City just isn't business friendly thus the reason the city has to use tax breaks or millions in taxpayer money giveaways as a way to attract businesses. The mall will forever fail as it needs to be a full size mall with full size stores. General Growth does nothing to bring people there either. In most malls, there are activities that go on throughout the year in the mall. Having a train in the mall just doesn't do it. How about Christmas activities such as singers, maybe some Christmas skits another words, get people into the mall and General Growth does virtually nothing! Really Sad!
pinnicle
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December 23, 2011
Rickman,

I don't know how long you lived here, but Tracy used to have a Chuck E Cheese at the Amtrack bus stop, right off of Tracy Blvd, on Clover Road. That was years ago and then they left.

History aside, today if your goal is such as, "don't settle" (as the Tracy Press quoted you as saying), then why don't you ask for Johns Incredible Pizza, Dave and Busters, or Boomers?

Just a suggestion. I hope it helps!

Macpup
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December 23, 2011
Surprise, Surprise - the Council approved the incentive program. It had to be signed and sealed because the City couldn't wait until it could be reviewed properly - a lot like our Congress passing Bills they don't have time to read.

The City does not need to use tax payer dollars to draw businesses. Just make itself attractive by lowering the loop-holes businesses have to jump through to set up shop here. If it is profitable to them, they will come.

Businesses will be leaving California starting in 2012 when Cap and Trade is fully implemented, so no matter what stimulus we offer, it won't be enough.
pinnicle
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December 23, 2011
Cap and trade is actually a different issue. Yes, California does tack on too many restrictions that chase off business telling us climate change is killing people blah blah blah.

The goal of attracting business HERE would certainly have payoff. Yes, businesses will come and go, but getting 1000 jobs here will not chase business to Texas. No sir the world does not work exactly that way, but I do see your point about cap and trade. It just isn't the root cause here.


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