BELEN — The Belen City Council will soon consider repealing an ordinance that would have given a national coffeehouse chain, which is currently under construction, an economic development incentive.
Earlier this year, the city council approved a Local Economic Development Act application for Starbucks to build a new, 2,293-square-foot coffeehouse at 401 N. Main St., just north of Walgreens. The national corporation was given the go-ahead to start construction, including needed infrastructure to access the property.
When the city approved the LEDA application, the developer, Center Pointe, had agreed to pay $260,000 up front for infrastructure improvements, and the city councilors agreed to forgo 100 percent of Starbucks’ gross receipt taxes they would pay to Belen until that amount is reimbursed to the company — which was estimated to be 14 years. The company also agreed to maintain a certain number of employees.
Last month, Steven Tomita, Belen’s development services director, told the council Center Pointe revealed Starbucks has reservations about the requirements of the deal.
“Since we passed this, LEDA, under state law, required us to enter into the agreement with the owner of the property,” Tomita said. “Since then, the owner has had an issue because they’re dependent on Starbucks meeting the requirements, including the number of employees, their tax base and reporting their (gross receipts tax).”
Tomita said he’s been going back and forth with the developer trying to figure out a way that it could be incorporated into a new LEDA agreement. The development services director informed the council that during a recent meeting with Center Pointe and Starbucks, it was made clear the company wasn’t going to disclose any revenue or GRT.
“Because of that, the LEDA (requirements) cannot be met, and we need to go ahead and (repeal) the LEDA (agreement),” Tomita said.
Councilor Steven Holdman asked if rescinding the LEDA agreement would affect the project.
Starbucks initially projected sales of $1,100,000 in gross sales its first year in Belen. It was reported earlier this year that when the coffeehouse opens, it would employ between 18-40 employees, with about 25 percent being full-time and 75 percent being part-time.
Prior to beginning construction, Starbucks was working with the New Mexico Department of Transportation to come up with a solution to the access issue from Main Street into the property. According to the application, NMDOT indicated it wasn’t going to allow the proposed project access from Main Street.
After investing heavily in traffic studies, NMDOT agreed it would allow Starbucks a “left-in” movement only from Main Street. The developer is also required to install a raised median and create a left turn pocket for cars.
“The project is still moving forward,” Tomita said. “It was all based on Center Pointe, they couldn’t guarantee the jobs because it was based on Starbucks, and they wouldn’t report to the city what their earnings are and refused to report the GRT. We did not bring Starbucks into the agreement because they’re not the owners; they’re leasing.”
The council, including Councilors Holdman, Frank Ortega and Tracy Armijo, voted unanimously to publish the city’s pending consideration of repealing the ordinance approving Center Pointe Development Group LLC proposal for economic development project. Councilor Danny Bernal was not present at the meeting.
The council will make their final decision at the Monday, Dec. 18, council meeting.
Tomita told the News-Bulletin following the meeting he is looking at other economic development avenues to help Center Pointe pay for the NMDOT-required infrastructure needs for the project.
In other business, the council:
- Approved the purchase of two hangers at the Belen Regional Airport, one at 7,300 square feet, and another at 12,500 square feet. Both buildings will be purchased at $250,000.
Airport director John Thompson said the state’s aviation division is interested in expanding the aviation maintenance school and would possibly use the smaller building. He also said state officials have told him they would likely give the city a grant to cover 80 percent of the purchase price for the school.
The larger building, which has 10 hangars, is currently being rented out, and would create an immediate revenue stream.
Clara Garcia is the editor and publisher of the Valencia County News-Bulletin.
She is a native of the city of Belen, beginning her journalism career at the News-Bulletin in 1998 as the crime and courts reporter. During her time at the paper, Clara has won numerous awards for her writing, photography and typography and design both from the National Newspaper Association and the New Mexico Press Association.
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April 25, 2024
