By ALICIA FEYERHERM
Tiger Media Network
The Hays City Commission adopted a resolution of intent to issue Industrial Revenue Bonds (IRBs) for Chick-fil-A during Thursday’s meeting.
The developer plans to construct a Chick-fil-A restaurant at 3404 Vine St. at the site of the former Rodeway Inn. Assistant City Manager Jarrod Kuckelman said the developer has requested an IRB sales tax exemption for qualifying construction materials. The estimated benefit for the developer is $66,875.
“They’ve been working on the process of developing in Hays for some time now and over that time, their anticipated construction costs have gone up,” Kuckelman said.
Kuckelman explained that the commission would issue only a resolution of intent. The bonds themselves would not be issued until the project has reached substantial completion.
“The onus is on them (the developer),” Mayor Mason Ruder said. “They have to perform or it doesn’t work.”
The developer’s estimated investment is around $6.2 million, including land costs.
With an estimated $5.5 million in annual sales, the City estimates $123,750 in sales tax revenue after completion.
“(The) $5.5 million comes from the developer, and they tend to use a low or less optimistic take on those to be as realistic as possible, so it could come in higher than that,” Kuckelman said.
Citizen David Koshiol commented on the proposal.
“Over just the last year, we’ve already directed, redirected or forgoing roughly $400,000 annually in tax revenue on a handful of projects, and now we’re considering adding onto that for a company like Chick-fil-A, a national chain with a proven model, strong margins and a track record of expanding into markets like ours without needing subsidies,” Koshiol said.
Koshiol said these incentives pick winners and losers.
“That’s not a free market,” Koshiol said. “It’s selective advantage.”
Kuckelman noted the restaurant will create about 70 full-time and part-time jobs.
“I hope we continue to pull people into the community to fill those jobs and provide some competition,” Ruder said. “Competition is going to drive up wages and drive people to fill those positions and that’s what we need.”
Ruder said he has heard concerns about traffic flow in the area. He said there may be a back entrance by the Hobby Lobby parking lot, but that will be worked out between the developer and Hobby Lobby.
“I’m assuming it’s going to back up a lot of traffic along that area,” Ruder said. “They (the developer) have asked to be involved in some kind of help with that by partnering with Public Works and PD, making sure things are moving appropriately so no one is getting backed up.”
Commissioner Sandy Jacobs said the roundabouts help with traffic flow in that area.
“I don’t think this is anything new for Chick-fil-A and their willingness to work with everybody is stellar,” Jacobs said.
The resolution was adopted 5-0.
“I know they’ve been looking at it for years, so for something to finally come up and be part of that renaissance of north Vine that’s super exciting,” Ruder said.
Other items from the meeting included:
- Award of a bid in an amount not to exceed $150,000 to Dakota Municipal Solutions for sanitary sewer cleaning and inspection.
- Adoption of the 2024 International Property Maintenance Code with amendments.
- Adoption of the 2023 National Electrical Code with amendments.
The next City Commission meeting will be at 4:00 p.m. on April 9 at City Hall.