So what would you rather have in your community — an Amazon fulfillment center or a Great Wolf Resort?
Both create jobs that are fairly decent but aren’t the coveted standalone head-of-household jobs. Keep in mind it takes a full-time job at $20.12 an hour to meet the minimum 2.5 times the rent of a one bedroom, one bathroom apartment at Manteca’s Laurel Glenn complex that costs $1,395 a month before you are even considered as a potential tenant.
Both create buzz for the community. Great Wolf, however, will unleash a multi-million annual advertising campaign that predominately emphasizes Manteca. That’s something an Amazon center will not do.
Both create vehicle traffic. Amazon runs trucks around the clock adding to peak traffic woes and grinding down service streets at a faster rate than cars. Great Wolf at full capacity would draw 500 hotel guest vehicles a day. Based on typical Great Wolf guest patterns and how the resort is operated most arrive during off-commute peak times and depart after the evening rush.
Both take money primarily spent by Bay Area-based consumers and places part of it in the pockets of South County workers. Amazon does it via online ordering and Great Wolf via booking stays at their waterpark resort.
Both pay property taxes. Both collect sales taxes but in different fashions. Tracy collects sales tax from Tracy-based customers that order online from Amazon and Manteca will collect sales tax from anyone who uses the restaurants and Adventureland although most customers will be non-Manteca hotel guests.
Great Wolf collects room taxes. Amazon doesn’t. And that is what sets Great Wolf apart from Amazon et al.
Room tax is the only tax outside of parcel taxes that the state doesn’t get a piece of the action. That’s huge.
Over the course of 30 years — including a 25-year room tax sharing agreement that helps fund the $180 million resort construction budget — Manteca will receive $99.1 million. Based on terms of the deal and by using 70 percent occupancy projections with room rate increases as the years unfold, the net amount the city receives won’t exceed $2 million annually up until 12 years after the ground breaks. It then pushes upward toward $4 million through the 25th year before soaring to the $10 million mark and beyond each year thereafter.
Fulfillment and distribution centers don’t have that component that essentially picks up part of the tab for police and fire services as well as parks and street. Better yet, you and I aren’t paying the tax. Non-Manteca residents are.
Tracy does offer incentives to lure private sector investment across the board including distribution centers. Tracy’s municipal website details the incentive packages. The principles Manteca is employing in the Great Wolf deal — as well as in the Bass Pro Shops and Costco deals — are employed by other local jurisdictions. The big difference is Manteca went after the high hanging and more productive fruit in the form of sales and room taxes.
Occasionally those distribution center deals will snare a sales office such as Manteca has with BR Funsten that distributes flooring materials.
Manteca deliberately went after three unique and trackable sources of income.
First, the Poag & McEwen deal that brought The Promenade Shops at Orchard Valley anchored by Bass Pro Shops to Manteca 10 years ago. More than 96 percent of the sales tax Bass Pro collects originates from the pockets of non-Manteca residents. The sales tax collected from the center is split. But in 25 years it will all go to Manteca.
Costco is a different animal. The firm, that wasn’t planning on building a store in Manteca any time soon, tracks where its members live and now much they buy a year in both taxable and non-taxable sales. Manteca consumers were spending enough at Costco stores in Modesto and Tracy that they were pumping more than $700,000 combined annually in sales tax into the general funds of those two cities.
Manteca basically agreed to split the sales tax generated from the Daniels Street store 55-45 with Costco until the $10.5 million the firm spent to build the store is recouped. That will happen in less than two years of by the time Great Wolf opens next door. That will bring another $500,000 into the city’s general fund as 100 percent of the local sales tax paid at the Manteca Costco store will go to pay for Manteca’s day-to-day city services.
All three city deals were engineered to produce measurable and tangible results and not iffy indirect sales tax impacts based in the assumption people employed at the concerns will buy taxable consumer goods in Manteca.
The Costco deal brought back to Manteca what it had lost as well as snared taxable dollars from nearby consumers in Lathrop and Ripon.
Bass Pro Shops captures sales tax dollars mostly from non-residents.
Great Wolf does the same thing but with a room tax. And it does it on a much grander scale.
Manteca’s share of the basic sales tax of 7.25 percent is 1 cent on every dollar spent with the other 6.25 cents going to the state. The city also gets 100 percent of the half cent public safety sales tax.
But with room the 9 percent room taxes, 100 percent is local. And after the 25 year split with Great Wolf it is all Manteca’s.
With Manteca hitting the 100-year mark in 78 days, the Great Wolf deal may indeed be called the deal of Manteca’s first century.
This column is the opinion of executive editor, Dennis Wyatt, and does not necessarily represent the opinion of The Bulletin or Morris Newspaper Corp. of CA. He can be contacted at email@example.com or 209.249.3519.