Retail Incentive Programs
Retail Rehab & Redevelopment Performance-Based Matching Grant
Specialty Retail & Restaurant
Back-Fill and Specialty Retailer Incentive Program for Vacant Grocery Store Anchors
Details on each of the programs noted above can be found below.
The Program is sponsored by the City to provide financial incentives to existing retail shopping centers and other retail facilities for enhancements and/or redevelopment. Improvements must enhance the tax base related to the retail facilities and surrounding development. The Program is retention-based with the goal of rehabilitating the retail facilities for aesthetic or architectural appeal. Each application is determined on a case by case approach.
This is a matching grant program. The City may elect to make a grant in an amount up to 100% the cost of the improvements (refer to eligible expenses below). Such grant will not to exceed $1 million of public funds for each grantee.
Acceptable Categories of Improvements
The following are the eligible expenses:
Eligibility Criteria for Eligible Retail Facilities
Application and Approval Process
Retail Redevelopment and Rehabilitation Performance-Based Grant (Historic Downtown Carrollton)
For the purpose of this policy, Historic Downtown shall be defined as an area bordered by:
o Belt Line Rd. to the North
o DART rail right-of-way to the East
o Vandergriff to the South
o IH-35E to the West
The Program is sponsored by the City to attract retail uses (including restaurants) to Historic Downtown. It provides for financial incentives to retail facilities for enhancements and/or redevelopment. Improvements must enhance the tax base related to the retail facilities and surrounding development. Each application is determined on a case by case approach. Nothing herein shall imply or suggest that the City of Carrollton is precluded from considering other options which would further the best interests of the City.
This is a matching grant program based on an agreement providing performance conditions. The City may elect to make a grant in an amount up to 100% of the cost of the improvements (refer to eligible expenses below). Such grant shall not exceed $1 million of public funds for each grantee.
1. Acceptable Categories of Improvements / Eligible Expenses
• Rent assistance for a limited time
• Interior and exterior finish costs
• Development costs
• Upgrade or enhanced landscaping improvement costs
• Signage upgrade costs
2. Eligibility Criteria for Eligible Retail Facilities
• The retail facility or facilities must be older than twenty (20) years.
• Potential impact of the reinvestment project on surrounding neighborhoods.
3. Application and Approval Process
An application for incentive must be submitted to the City's Office of Economic Development. The application should include a detailed description of the project including renderings or drawings of the finished project, a project budget including sources of funds, project timetable (if applicable) and a copy of the lease agreement.
Project review of each application is required by staff including appropriate comments and recommendations for changes prior to submission to the City Council TOD Sub-Committee.
All applications will be reviewed by the City Council TOD Sub-Committee. Applicants may be asked to present their project before the TOD Sub-Committee and any modifications to the application will be made prior to forwarding the application to the full City Council with a recommendation for approval or denial.
City Council will review the recommendation of the City Council TOD Sub-Committee and vote to either approve or deny the grant application.
Grant incentives will consist primarily of cash payments as outlined in an incentive agreement to be entered into between the City and the applicant receiving the grant.
The City seeks to recruit new and retain existing unique, specialty retailers and restaurants that help to differentiate Carrollton from dining and entertainment venues in other communities within the Dallas Metroplex and to contribute to the City Council’s overall vision of enhancing quality of life for Carrollton’s residents. The proposed Specialty Retail & Restaurant Incentive Policy serves the community’s desires for attracting and retaining unique, quality retailers and restaurants that do not already have a strong presence in the marketplace.
Incentives are targeted to the following types of retailers and restaurants:
1. “Destination” retailers and restaurants that
a. Have the capability to attract customers from outside the community;
b. Do not have another existing location within a 5-mile radius; and
c. Fit well into the existing retail/restaurant economy to provide new and different shopping and/or dining and entertainment experiences.
d. Local, Regional, and National retailers or restaurants may apply if qualified under subsection (a), (b), and (c) above.
2. Expansion, second location and relocation of existing Carrollton retailers and restaurants:
a. Meet the criteria set in Section 1 above (subsection (1)(b) does not apply);
b. Expansion – added square footage must be a minimum of 50% larger than current space.
3. Developers and Shopping Center Owners leasing space to destination retailers and restaurants may apply.
* In order to qualify for incentives, specialty retailers and/or restaurants are required to sign a minimum 5-year lease with the Developer/Shopping Center Owner, no matter which party is the applicant and potential recipient of the incentive. Based on the value of the incentive requested, the City may require the tenant to sign a lease for a period longer than five (5) years but not to exceed fifteen (15) years.
Any request for incentives shall be reviewed on a case-by-case basis by the City Council. Their decision shall be based upon an evaluation of the following criteria, which each applicant will address in narrative form when submitting an Application for Economic Development Incentives:
Anticipated direct sales tax to be generated.
Total number of full-time jobs brought to Carrollton.
Total payroll for all FTEs.
Ad valorem taxes to be generated.
Does the business satisfy/address the community’s needs for unique, quality retailers and/or restaurants?
The effect the project would have on existing businesses in Carrollton.
A list of specific businesses seen as direct competitors to the applicant. The City of Carrollton seeks first to retain existing businesses, and therefore will consider whether an applicant will compete or potentially displace an existing business.
TYPES OF INCENTIVES
o The City may reimburse up to 50% of the costs of façade improvements (including signage, landscaping and lighting).
o The City may reimburse up to 50% of the costs of tenant improvements (not including FFE – fixtures, furniture and equipment).
Development Fee Rebates – The City may approve the rebate of all or a portion of certain permit and development fees.
Rent Assistance for up to 12 months is available to destination retailers and restaurants (not exceeding 3,500 SF) that do not have a strong presence in other locations in DFW and locate within a targeted site identified by the City:
Transit Center District – see Attachment 1.
Shopping centers with occupancy rates below 70%.
Ad Valorem Incentives – the City may offer a tax rebate for up to five (5) years and up to 50% of the City of Carrollton taxes assessed upon value of Improvements.
Sales Tax Rebates – the City may rebate up to One Percent (1%) of Sales and Use Tax for up to ten (10) years.
This incentive applies only to national and regional retailers and restaurants. The sales tax rebate would be paid in annual installments within ninety (90) days of the end of each twelve (12) calendar month period following the issuance of the certification of occupancy for the facility, or other commencement date if no certificate of occupancy is required. Any sales tax incentive would be limited to the extent that the City has received sales tax from taxable sales by the applicant. The City’s obligation to pay the sales tax rebate in the Agreement would additionally be conditioned upon the applicant requesting and providing sales tax documentation from the Office of the Comptroller of the State of Texas.
In the event that the applicant files an amended sales and use tax return or report with the State of Texas, or if additional sales and use tax is due or owing, as determined by the State of Texas, affecting sales tax receipts for a previous twelve (12) calendar month period, the City will be making adjustments accordingly. The City of Carrollton reserves the right to conduct an audit at any time of the applicant’s books, papers and reports, and to ensure compliance with the Incentive Agreement. Furthermore, in the event of termination of the Agreement, the City has the right to recapture any and all rebated taxes for the calendar year in which any default occurred.
The sales tax incentive will be conditioned upon:
Generation of a certain level of sales tax – to be determined based on type of retailer/restaurant
Term of occupancy: a minimum 5-year lease will be required. The term of the sales tax rebate incentive shall not exceed the term of the lease. Should the applicant request and qualify for a sales tax rebate for the maximum allowed period of 10 years, a 15-year lease will be required.
SUMMARY OF INCENTIVES
The incentives provided under this policy are granted utilizing Chapter 380 of the Texas Local Government Code. It is the policy of the City of Carrollton to customize the provisions of economic development incentives on a case-by-case basis to result in a “Win/Win” agreement for the applicant and for the City of Carrollton taxpayers. This individualized design of a total incentive package is intended to allow maximum flexibility in addressing the unique concerns of each applicant while enabling the City to better respond to the changing needs of the community. The City Council reserves the right to make exceptions to this policy as deemed necessary. Furthermore, the City reserves the right to terminate any and all Incentive Agreements should the specialty retailer and/or restaurant cease operations at any time. All incentives are subject to availability of funding. Nothing herein shall imply or suggest a guarantee of approval of any incentive request.
Eligible Projects Matching Grants Development Fee Rebates Rent Assistance Ad Valorem Sales Tax Rebate
Façade Improvements Tenant Improvements
Destination (Not National / Regional)
1. Applicant shall complete an “Application for Economic Development Incentive” as provided by the City.
2. Applicant shall submit a narrative addressing each factor highlighted in the Review Criteria together with a Business Plan.
3. Staff will review all documentation for completeness and accuracy. Additional information may be requested as needed.
4. The application package will be reviewed by the City Council Re-Development Sub-Committee (“Re-Development Sub-Committee”). Applicants may be interviewed by the Re-Development Sub-Committee and any modifications to the application will be made prior to forwarding the application to the full City Council with a recommendation for approval or denial.
5. City Council will review the recommendation of the Re-Development Sub-Committee and vote to either approve or deny the grant application.
Back-fill and Specialty Retailer Incentive Program for Vacant Grocery Store Anchors
The Redevelopment Subcommittee met on May 5, 2009 and made the recommendation that Council adopt the Back-fill and Specialty Retailer Incentive Policies. City Council adopted the Retail Redevelopment Grant Program in 2007 which provides grant monies to aging and underutilized retail facilities. These policies are an extension of that program in order to encourage retailers or specialty retailers to back-fill vacant grocery store anchors in excess of 50,000 square feet in the City. The back-fill policy is for those tenants who can fill more than 50 percent of the total anchor square footage; while the specialty retailer policy is for those tenants who cannot fill the required 50 percent of the total square footage, but must have a demised space of greater than 10,000 square feet.
Back-fill Incentive Program for Vacant Grocery Store Anchors
The goal of the program is to make grants of public money to promote and stimulate local economic development of vacant anchor stores of greater than 50,000 square feet.
Vacant Anchor Incentives:
Eligible Types of Businesses
Ineligible Types of Businesses:
Prior to the property becoming vacant, the property must have been a grocery store for at least five years. This incentive is for the attraction of new specialty retailers who move into a vacant grocery anchor store. The tenants’ eligibility for funding will be determined based on factors such as:
Eligible Tenant Improvements:
Funding for this program will be a maximum of $2-$5/square feet for the tenant space occupied (gross floor area), not to exceed the total square footage of the vacant anchor. These monies will be given to the owner/developer of the respective property for reimbursement of eligible tenant improvements. The allowance is a one-time only grant.
Application and Approval Process:
Specialty Retailer Incentive Program for Vacant Grocery Store Anchors
The goal of the program is to make grants of public money to promote and stimulate local economic development of vacant grocery anchor stores of greater than 50,000 square feet specifically for specialty retailers who back-fill less than 50 percent of the vacant grocery store anchor space.
Specialty Retailer Definition:
A retailer concentrating on selling one merchandise line of goods or services for a particular and usually selective clientele. Examples are stores selling sporting goods, organic food, electronics and movie theatres. Specialty retailers have a narrow but deep selection in their specialty.
Specialty Retail Incentives:
Eligible Types of Businesses:
Ineligible Types of Businesses:
This program is for specialty retailers only. The City of Carrollton may decide on a case-by-case basis to exclude other business activities which it believes does not benefit the health, safety, and welfare of the community and/or do not meet the objectives of this program.
Prior to the property becoming vacant, the property would have to have been a grocery store for at least five years. This incentive is for the attraction of new specialty retailers who move into a vacant grocery anchor store. The tenants’ eligibility for funding will be determined based on factors such as:
Eligible Tenant Improvements:
Funding for this program will be a maximum of $2.00-$5.00/square feet for the tenant space occupied (gross floor area) not to exceed the total square footage of the vacant anchor. These monies will be given to the owner/tenant of the respective property for reimbursement of eligible tenant improvements. The allowance is a one-time only grant.
Application and Approval Process: