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THE CITY OF 2 <br /> LEASANTONCITY COUNCIL AGENDA REPORT <br /> February 20, 2018 <br /> Community Development <br /> Finance <br /> TITLE: ADOPT A RESOLUTION AUTHORIZING THE CITY MANAGER TO <br /> EXECUTE A JOHNSON DRIVE ECONOMIC DEVELOPMENT ZONE <br /> TRANSPORTATION IMPROVEMENT AND COST ALLOCATION <br /> AGREEMENT WITH COSTCO WHOLESALE CORPORATION <br /> SUMMARY <br /> Staff is recommending that the City Council adopt the attached Resolution authorizing <br /> the City Manager to execute a Johnson Drive Economic Development Zone <br /> Transportation Improvement and Cost Allocation Agreement with Costco Wholesale <br /> Corporation. <br /> RECOMMENDATION <br /> Adopt the attached Resolution authorizing the City Manager to execute a Johnson Drive <br /> Economic Development Zone Transportation Improvement and Cost Allocation <br /> Agreement with Costco Wholesale Corporation. <br /> FINANCIAL STATEMENT <br /> The Transportation Improvement and Cost Allocation Agreement commits the City to <br /> allocate 40% of the sales tax generated by the Pleasanton Costco store to Costco <br /> Wholesale Corporation ("Costco") to repay the $6.8 million advance at 1.5% interest <br /> that Costco will make to help fund the transportation improvements required for the <br /> Johnson Drive Economic Development Zone ("JDEDZ") as well as repay Costco for <br /> 50% of the costs at no interest to acquire the right-of-way required for the transportation <br /> improvements. City staff estimate that 40% of the sales tax generated in the Costco <br /> store to be approximately $370,000 in year one. The proposed JDEDZ Transportation <br /> Fee that the City intends to charge future developers in the JDEDZ will also help repay <br /> the Costco advance. City staff estimates that without the proposed JDEDZ <br /> Transportation Fee, it could take between 14 to 20 years to repay Costco through <br /> sharing 40% of the sales tax generated by the Pleasanton Costco store. <br /> The $6.4 million in Traffic Impact Fees collected by the City from prior development that <br /> the Agreement commits the City to provide to help fund the Stoneridge Drive and 1-680 <br /> Onramp project is included in the FY 2018/19 Capital Improvement Plan (CIP) budget <br /> that was approved by City Council in June of 2017. <br />