The new retail development going up at the old Walmart building, which has so far announced Dollar Tree as a tenant, could receive up to $450,000 in a sales-tax rebate incentive approved by the Snyder City Council on Monday.
Power Sky Capital, LLC, applied for the abatement based on its investing more than $4 million on the project and the tenants creating four new full-time and 16 new part-time jobs.
Power Sky Capital is a company registered to Marc Shipton of Lubbock, who is also the owner of CMS Properties. According to information from Development Corporation of Snyder (DCOS) Executive Director Bill Lavers, Shipton has spent $5.5 million on property in Snyder since 2013 with another $6 million expected in the future.
Shipton and his companies currently own the old Walmart property, Varsity Square, a spec office building on 37th Street, property in the SnTx Industrial Park and the buildings where Bealls and Hibbetts Sports are located. According to information distributed by Lavers, he is in negotiations to purchase the former Dickey’s property as well as the shopping center where Barbee Medical Supply and Domino’s Pizza are located.
The Walmart project includes two new 16,000-square foot buildings on the parking lot, one of which is currently under construction, as well as renovating the old Walmart building.
The abatement agreement involves the city, DCOS and Power Sky Capital. The city on Monday agreed to rebate 70 percent of the sales taxes collected by the merchants at the Walmart development to Power Sky Capital for five years. The DCOS board is expected to vote on rebating 70 percent of its sales taxes generated at the new development for five years later this month. The total rebate is capped at $450,000.
The city’s vote was not contingent on the DCOS board of directors’ vote, but the agreement stipulates that the agreement is contingent on all three parties’ participation. Lavers said Shipton had approved the agreement earlier Monday.
Lavers said Breckenridge and Gonzales have both successfully used similar agreements, which are called Chapter 380 agreements because of the state code under which they are allowed, to attract tenants to shopping centers.
Lavers said Shipton has been aggressive about securing tenants, even offering free rent, but he said Shipton has had a hard time recruiting businesses to Snyder. Shipton’s company would receive the rebates, although the businesses would be responsible for creating the jobs and completing state reports.
The Snyder City Council also came closer to approving an updated ad valorem tax abatement policy on Monday.
Although the council thought it had changed the wording it was looking for in the policy, it decided to table the vote and asked City Manager Merle Taylor, Lavers and the city’s attorney, Bryan Guymon, to make sure that removing a statement requiring demolition won’t have any unintended consequences.
Lavers said he had concerns about some of the wording in the policy’s definitions, including what would be considered eligible facilities, the term modernization and what was considered a new facility.
The policy was changed last week to include existing retail establishments and restaurants, as well as lowering the amount of required improvement from $500,000 to $50,000 and lowering the amount of economic impact from $1 million to $100,000.
The abatements would only apply to the amount the property’s value increased, not the base valuation before the improvements were made, and will only include the city’s taxes.
Shipton has also applied for an ad valorem abatement on his development at the old Walmart building, but the application is not yet completed.
The council is expected to vote on the abatement policy at its next meeting. It was unclear if Shipton’s application would be completed in time for the council to act during next Monday’s meeting.
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