Yes I also agree on the need for a long term agreement, the longer the better the incentives or breaks.

With respect to other development fees, there are significant fees charged to mitigate traffic and other infrastructure related impacts. Additionally, many growth cities offer sales tax breaks for the first few years to lure in prime retailers and restaurants. It may be worth offering impact fee and temporary sales tax credits to desirable retailers/restaurants that are willing to commit to long-term agreements with Dublin. For example, Dublin could offer a 1/4% sales tax credit to desirable retailers for a 5-year period if they make a 20-year commitment to Dublin. While it would be great to get the full 1% of taxable purchases, it might make more sense to get 0.75% of something rather than 1% of nothing.

Thx, John Z.

Maybe even tax breaks for the first year or two in operation?

It seems that with the fees so high, we will likely end up with only large national chains that can absorb such a high startup cost. Most others for example like Le Cheval “Walnut Creek”, Sushi Maru “Milpitas” or even Sozo “Pleasanton” wouldn’t be able to afford a location in East Dublin.

Although the fees are not charged by the City, but by the Water District, is there anything the City can do to ease other development related fees to soften the blow a bit for Restaurants wanting to open in the East? I know we are cutting needed income upfront but in the long run it will pay off when we have a vibrant retail center “The Promenade, Grafton Station, The Green at Park Place” that has a healthy mix of national chains and smaller family/independently owned restaurants that is unique and cannot be found in any town. Maybe a partnership with the developer to help absorb some of these fees for prospective restaurants.

It may be more complex than this but just an idea to throw around. I’d hate to see the 3 retails centers above become cookie cutter like any other that you can find in any other towns.

The Elephant Bar is a perfect example of a scenario where the new restaurant already had a water/sewer connection in place from the previous building owner (El Torito). Based on this, the Elephant Bar only needed to pay an incremental connection fee related to their increased usage. The Elephant Bar also saved quite a bit on other impact fees by renovating vs. buying new. You can see how there could be a huge advantage to purchasing an existing building and making renovations instead of starting from scratch.

Developers pays the connection fee upfront. However, the developer has a few options to recoup the fee – 1) charge the entire fee upfront to the first restaurant/tenant that moves in; 2) charge a portion to the first restaurant and then the rest to future tenants; or 3) charge higher lease rates. It all depends on the specific agreement that the developer/building owner works out with the restaurant owner.

The water and sewer connection fees are the same for all of Dublin. Additionally, other nearby cities face similarly high fees. However, east Dublin is impacted the most by the fees because of the abundance of new development. It is a tremendous hurdle for the Promenade, Grafton Station, and The Green on Park Place to overcome – especially in a challenging economic environment where many folks are cutting back on retail/restaurant purchases. For example, the Japanese restaurant that had planned to open at Grafton Station decided to hold off on signing a lease agreement because they couldn’t afford the connection fee.

Given that the connection fees are based on estimated usage rates and meter size, there is an intrinsic benefit for companies that have relatively low water/sewer needs to move to east Dublin (e.g., software companies and professional service firms). This is a silver lining given that these are some of the industries that we’d like attract to Dublin.

Thx, John Z.