Thanks for shopping: City Council approves $2.5 million payment for newHeights-area Kroger
It’s a go... Houston City Council officially approved plans to reimburse Kroger $2.5 million for improvements related to its planned new store in the 1400 block of Studemont near the Heights. The measure passed by a 10-5 vote Wednesday morning.
The new grocery store will be less than three miles from Kroger branches on West Grey, Montrose, and 11th and 20th Streets in the Heights. The new Whole Foods on Waugh and the Heights Fiesta on Studemont are less than two miles from the site.
Responsible Urban Development for Houston (RUDH), the nonprofit group also battling the construction of the Walmart at I-10 and Yale, sent yet another letter to Mayor Annise Parker Tuesday, asking the City to reconsider approving a tax-incentive deal meant for promoting growth in areas without existing economic drivers.
City officials say the deal makes Kroger provide immediate solutions to traffic issues Houston would have to solve in years to come otherwise.
"We'd like to applaud the five council members who voted no today," RUDH director Eileen Crowley-Reed told CultureMap. "Congratulations to you C.O. Bradford, Anne Clutterbuck, Jolanda Jones, Melissa Noriega and James Rodriguez."
RUDH slammed the City’s recent tax proposal, known as a 380 agreement, to reimburse Kroger up to $2.5 million for adding urban infrastructure such as traffic lights and sidewalks. According to City officials, the deal makes Kroger provide immediate solutions to traffic issues Houston would have to solve in years to come otherwise. City officials also touted the jobs created and tax revenues that will be generated by the new store.
Under Texas Government Code, the 380 agreement was created to use public funds to "promote state or local economic development and to stimulate business and commercial activity." RUDH claims the Kroger intended to build the store, with or without government reimbursements, since late last year.
“Kroger is in the business of building grocery stores to make money. This is their business model. The public should not be footing the bill to cover infrastructure improvements that are, as stated in the Kroger 380, ‘necessary to serve the Project,’ ” Crowley-Reed wrote in a recent letter to mayor Parker. Crowley-Reed noted that no incentive money is needed to bring grocery store to the Studemont location; the company always planned to build there.
"We want to strees two main points," Crowley-Reed told CultureMap. "First is the inequality surround an arrangement that uses public funds meant for economically-underserved communities. The second point deals with bad financial policy. The City could buy low-interest municipal bonds, but have decided to pay 5.7 percent interest attached to this 380 agreement. It's like using a credit card."
Meanwhile, RUDH is still fighting the controversial Walmart project at Yale and I-10, filing a lawsuit to invalidate the 380 agreement that provides $6 million in reimbursements to the shopping center’s developer Ainbinder Heights, LLC.