University Star

A San Marcos shopping center is expected to continue receiving monetary incentives from the city in accordance with the rise of consumer interest in the area.

StoneCreek Crossing is a shopping center consisting of stores such as Target, JCPenney and Academy Sports and Outdoors located north of the Prime and Tanger Outlet Malls. The JCPenney, Bealls and Target shops opened in March 2009 with the addition of Academy Sports and Outdoors in November of the same year.

Direct Development owns the approximately 450,000 square foot shopping center located on 113 acres. The city approved an agreement with the shopping center in 2007. City officials will reimburse StoneCreek Crossing developers based on additional local sales taxes generated by the area.

The San Marcos sales tax rate is 8.25 percent, which is applied to products bought at stores and some services. Sales tax revenue can be used for transportation expenditures, public education and aid to local government.

The Chapter 380 Economic Development Agreement reimburses developers for additional local sales taxes of $500,000 up to $1 million. Any sales taxes totaling over $1 million are split 50 percent with the city, which reimburses the developer for 80 percent of property tax value increases. The city granted up to $6 million toward sales tax reimbursements in total.

At least $500,000 must be brought to the city from the StoneCreek Crossing shopping center due to a sales tax increase during the most recent fiscal year. This is one of the requirements making the area eligible for sales tax rebate incentives from the city.

Heather Hurlbert, assistant director of finance for the city, said the shopping center was reimbursed more than $900,000 last year. Hurlbert said the incentives are given based on the increase of sales taxes from the base year on the property to the current levels.

Linda Zimmerman, vice president/leasing of Direct Development, said the company gave a report to the city last week detailing the progress of the property leases in the StoneCreek Crossing shopping center.

“We have an agreement with the city, and if we have so much tenant space leased then we get tax reimbursements for certain things,” Zimmerman said. “That was part of the deal going in on that. We resubmitted our report to find out what was going on with leasing and things like that.”

Zimmerman said the StoneCreek Crossing shopping center brings significant revenues and jobs for citizens. She said the area has been “fairly profitable” over the past five years.

Melissa Millecam, director of communications and intergovernmental relations for the city, said the incentives are given to encourage economic development. Millecam said the shopping center has raised economic vitality in the community over the past few years.

“We want bigger tax areas everywhere in San Marcos,” she said. “We have two of the most successful outlet malls in the United States. It’s a big, important part of our economy.”

Zimmerman said the plot of land has undeveloped tenant space. She said the economic recession in 2007 has caused some leasing interest to decrease as well as the influx of new development south of Austin, in Kyle and the expansion of San Antonio northward.

“There’s so much growth there that it has been really slow turning back around with all that development going on, but it’ll get there,” Zimmerman said. “It just takes time. We are working on another pad right now to be sold next to it.”

Retailers such as Target, JCPenney and Bealls moved their businesses from the Springtown Center located on Springtown Way near Thorpe Lane to the StoneCreek Crossing shopping center in 2009.  Zimmerman said the stores changed locations because the Springtown Center was “old and rundown” and the new location increases freeway visibility.

Millecam said the City Council will be discussing the possibilities of future Springtown Center development at upcoming meetings.