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Friday, July 3, 2020
Home Government Council Report: Footwear, apparel company planning Fort Worth distribution center

Council Report: Footwear, apparel company planning Fort Worth distribution center

A California-based clothing brand may open a large distribution warehouse in the AllianceTexas area next year.

Union City, California-based Ariat International Inc., a footwear, apparel and accessories brand designed for equestrian sports and other outdoor activities, is seeking to bring 75 corporate jobs  and 375 indirect jobs to an 800,000-square foot facility at State Highway 156, just north of the BNSF intermodal site. The 75 corporate jobs would be onsite by December 2021. The city will consider an incentive proposal of about $2 million with the company making a $73 million capital investment in the area.

“The company based in California is planning to develop a distribution hub and regional corporate headquarters that would serve as the base for its Western U.S. operations,” said Robert Sturns, director of economic development for Fort Worth.

Sturns noted that Fort Worth has been competing with other areas around the country for the company expansion. “There was a site in Arizona, actually, that they were looking at as well as part of these discussions,” he said.

“Our proposal is a nine year incentive proposal of 40% of the ad valorem taxes plus a one-time cash grant. That estimated benefit including the cash grant is just under $2 million,” said Robert Sturns, director of economic development for Fort Worth.

Sturns said the investment would be at 37 to 1 ratio, private to public ratio, and then the net tax to the city over that nine year period will be just under $2.6 million with a three year payback for the overall incentive.

Sturns recommended the city enter into the nine year tax abatement agreement and provide the one-time grant of $212,000.

“The average annual salary for all full time jobs must be a minimum of $43,992, which is a figure from our incentive policy, and the company will forfeit the incentive in any year that the average salary of the employees falls below that,” Sturns said.

District 5 Councilwoman Gyna Bivens questioned the average annual salary level for the jobs being created.

“When we offer these abatements, companies need to bring a little something when they come,” she said. “I don’t know that $43,000 is going to excite anyone. I don’t know that it’s fair or not, but what can you do is… How do you feel good about the salaries coming in, $43 grand for some and $50 for others? I don’t think we have to give an incentive away to get a company bringing in those kinds of wages, so is it really worth it?”

The minority- and women-owned business commitment for the project is the city’s standard 15%, Sturns said. “Failure to meet that requirement will result in a reduction of the maximum potential incentive by 10 percentage points,” he said.

The project will likely come up for a council vote at the August 4 meeting.

Union City, California-based Ariat International Inc., a footwear, apparel and accessories brand designed for equestrian sports and other outdoor activities, is seeking to bring 75 corporate jobs  and 375 indirect jobs to an 800,000-square foot facility at State Highway 156, just north of the BNSF intermodal site. The 75 corporate jobs would be onsite by December 2021. The city will consider an incentive proposal of about $2 million with the company making a $73 million capital investment in the area.

“The company based in California is planning to develop a distribution hub and regional corporate headquarters that would serve as the base for its Western U.S. operations,” said Robert Sturns, director of economic development for Fort Worth.

Sturns noted that Fort Worth has been competing with other areas around the country for the company expansion. “There was a site in Arizona, actually, that they were looking at as well as part of these discussions,” he said.

“Our proposal is a nine year incentive proposal of 40% of the ad valorem taxes plus a one-time cash grant. That estimated benefit including the cash grant is just under $2 million,” said Robert Sturns, director of economic development for Fort Worth.

Sturns said the investment would be at 37 to 1 ratio, private to public ratio, and then the net tax to the city over that nine year period will be just under $2.6 million with a three year payback for the overall incentive.

Sturns recommended the city enter into the nine year tax abatement agreement and provide the one-time grant of $212,000.

“The average annual salary for all full time jobs must be a minimum of $43,992, which is a figure from our incentive policy, and the company will forfeit the incentive in any year that the average salary of the employees falls below that,” Sturns said.

District 5 Councilwoman Gyna Bivens questioned the average annual salary level for the jobs being created.

“When we offer these abatements, companies need to bring a little something when they come,” she said. “I don’t know that $43,000 is going to excite anyone. I don’t know that it’s fair or not, but what can you do is… How do you feel good about the salaries coming in, $43 grand for some and $50 for others? I don’t think we have to give an incentive away to get a company bringing in those kinds of wages, so is it really worth it?”

The minority- and women-owned business commitment for the project is the city’s standard 15%, Sturns said. “Failure to meet that requirement will result in a reduction of the maximum potential incentive by 10 percentage points,” he said.

The project will likely come up for a council vote at the August 4 meeting.