Costco seeks $1.35M in grants for poultry processing Plant
The changes to the company’s redevelopment agreement with Costco are similar to revisions to a broader redevelopment plan the council approved in December. They reflect revisions to the project timeline, an increase in plant size and more tax-increment financing than originally approved.
The total cost of the project would be $275 million, up from $180 million. The plant has been expanded to accommodate additional automated chicken deboning equipment and a larger intake room for truckloads of live birds.
About $18.3 million of the construction cost would be paid for through tax-increment financing, up from $13.5 million. TIF is a way of using future property tax revenue to pay for public infrastructure associated with private development.
Also tonight, the council will:
» Be asked to approve a $1 million grant from the city’s economic development fund, and $350,000 in grants from an economic enhancement fund, for property purchase, construction and equipment purchase. The grants are technically loans, but Costco won’t have to repay principal or interest as long as it meets certain milestones for capital investment and job creation.
Costco says in paperwork that the project will create up to 1,000 jobs. Up to 820 of those involve production work starting at $15 an hour. About 100 jobs will be supervisory or professional roles paying between $45,000 and $350,000 a year.
» Be asked to approve “clawback” provisions for a $2 million economic development incentive Costco will get from Fremont to defray some of the costs of extending utilities to the proposed site. Costco agrees to operate its plant for at least 15 years and to meet yearly minimum utility consumption requirements, or it will repay all or some of the incentive, according to the proposed agreement.
» Consider an agreement in which Costco would reimburse the city for up to $41,661, covering the cost of the city hiring an outside firm to review and approve building plans for the project. Fremont has hired Omaha engineering firm HDR for the work.
Costco now looks to start site preparation work this spring and open the plant by March 2019. The plant will slaughter and process up to 2 million chickens a week and will provide whole and cut chicken to Costco’s warehouse stores.
Opponents continue to fight the project, saying it will harm water and air quality, among other concerns. The city is fighting a lawsuit from residents who say it was wrong to designate productive farmland as “blighted” for the purpose of allowing tax-increment financing.
The project manager for Lincoln Premium Poultry, the firm that will operate the plant for Costco, said the changes that expanded the size of the plant were made in part in response to opponents’ concerns about humane treatment of the birds and working conditions for employees.
“We are doing the right thing in terms of animal welfare, employee welfare, engineering and traffic studies and the site itself,” said Walt Shafer of Lincoln Premium.
The City Council meets at 6:45 p.m. for a study session, followed by a 7 p.m. regular meeting, both at 400 E. Military Ave in Fremont.
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