After months of negotiations and even more discussion Tuesday night, the Santa Maria City Council agreed to allow auto dealerships moving to Enos Ranch sites to receive rebates for some fees based on designated milestones.
The auto dealers, representing Honda, Toyota and Home Motors, had asked the city to waive traffic-mitigation fees, or money paid to the city to cover future road-related projects stemming from growth.
However, the City Council voted 4-1 for a compromise plan hashed out in recent months granting the auto dealers some relief if they meet performance incentives.
Councilwoman Etta Waterfield was the lone no vote.
The Santa Maria Auto Center calls for nine lots in the Enos Ranch development, with plans for 250,000 square feet of dealerships, a car wash and 10,000 square feet of retail.
The dealers would be near the intersection of Bradley and Battles roads.
“We are trying to develop a regional auto mall that will pull from our surrounding areas, and there has been a lot of thought put into it,” said co-owner Mike Bouquet, joking that he had lost more hair than sleep. “All in all, the end product is going to be something that the entire city will be proud of.”
The city’s consultant, Rick Sweet, and auto dealer representatives hammered out a compromise calling for companies to pay those traffic mitigation fees but receive rebates.
“One of the things was we wanted to provide incentive for auto dealers to occupy the site. That was one of the concerns council members had,” Sweet said.
For instance, dealerships that already operate in Santa Maria would receive a rebate of $100,000 once relocated to Enos Ranch, while a new dealership would get a rebate of $200,000 per parcel.
Other rebates would be tied to increased sales tax generation for up to 10 years.
The proposal also provides incentives for keeping existing dealerships south of Betteravia Road as car lots to preserve the sales tax revenue the locations provide to the city.
In all, traffic mitigation fees would add up to approximately $3.9 million for the dealerships. The incentives would be capped at that amount, with the entire agreement ending after 20 years.
“We didn’t want to extend it into perpetuity because the idea is to bring in dealers quicker,” Sweet added.
Council members struggled with whether to approve the plan, especially after recently getting voters to agree to raise and extend a sales tax hike for public safety.
“This is a tough one,” Councilman Jack Boysen said.
The council also wrestled with whether to shorten the proposal’s time frame before agreeing to keep the original milestones.
“If we’re going to do this, I don’t think we should be tying their hands with this,” Councilman Mike Cordero said.
“Time frame doesn’t bother me,” Councilman Michael Moats said. “I wish you the best of luck and I hope you’re extremely prosperous.”
“I certainly feel, like everyone else on the council, that the auto dealers have demonstrated year after year after year their commitment to the city of Santa Maria, and have contributed greatly to the economic benefit of our city,” Boysen added.
But Waterfield said the time frame bothered her and prompted her vote against the agreement, adding talks about the car dealershps began during her 11 years on the Planning Commission
“I’m just really ready to make something happen as far as new car dealerships coming in and we keep on going around and around with this,” Waterfield said.
Laurie Tamura from Urban Planning Concepts said she and her clients view the proposed pact as a partnership.
“We consider it, after a lot of arm wrestling, a win-win for the city as well as for the dealerships,” Tamura said.
She added that the auto dealers have had a role in the Enos Ranch development, including participating in installing infrastructure improvements such as widening streets.
The goal calls for the first new building at the regional auto mall to be under construction next year, Tamura added.
Bouquet said there are numerous examples of incentives cities have offered to attract dealerships. Cities covet auto dealerships because they generate salex tax revenues.
The three dealerships provide an average of $1.7 million, sometimes more, in sales tax revenue annually, he added.
“We’re excited to announce that Kia is the first that wants to come to town,” Bouquet said. “We’d love to get you Mercedes. We want Lexus. We want a lot of the dealerships that we’ve talked about before.
“It is not our decision. They have to be ready to open up a new dealership, and when they do, we’re going to have the best location for them.”
— Noozhawk North County editor Janene Scully can be reached at jscully@noozhawk.com. Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.