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FOUNTAIN VALLEY : City Hopes to Lure Retail Businesses

July 14, 1993|DEBRA CANO

City officials are hailing a redevelopment deal that will bring a retail electronics business to town as the first step in luring other retailers to Fountain Valley.

"This is one way Fountain Valley has chosen to fight back in the down economy and marauding from Sacramento," Councilman John Collins said.

The City Council, acting as the Agency for Community Development, approved an agreement last week with Fry's Electronics Inc. in a move toward converting an industrial park to retail.

City Manager Raymond H. Kromer said Fry's is expected to generate more than $200,000 a year in sales tax revenue to the city.

He added that Fry's, which sells such goods as radios, computer components and compact discs, is planning to move into a building that has been vacant for nearly two years.

The building, at 10800 Kalama River, fronts the San Diego Freeway and is in a redevelopment area. The building is owned by JMB Income Properties Ltd., which also owns the 25-acre industrial park.

Fry's Electronics plans to spend about $3.5 million for building improvements, relocation costs and other expenses associated with moving to the site, Kromer said. The store is scheduled to open in October.

As part of the city's agreement, the redevelopment agency will rebate 50% of the total of the city's portion of the sales tax for 10 years--a pay-back for what the company is spending to locate to Fountain Valley, Kromer said.

An additional five-year sales-tax rebate option will be granted if Fry's achieves a minimum sales goal of at least $30 million a year for years eight through 10.

Kromer said that with a high-volume retail sales business locating to the area, the city anticipates other retailers moving into the industrial park.

Kromer said that by bringing in more retail business, the city is trying to stimulate its own economy and avoid taxing residents.

"If we can continue to have sales producers here, then we're going to be more fortunate than other cities," he said.

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