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Analysis of Costco Proposa'i <br />June 16, 1986 <br />Page 4 <br />It was statad previously that Costco may be a catalyst in promoting commercial <br />development in the area. Because of the park and lake, it is recommended that <br />the City discourage Costco type uses in favor of multi -story office buildings <br />surrounding the lake and park areas. Offices would be more compatible with <br />the park and would provide more users (i.e. - brown bag lunches, noon hour <br />athletics) and would lessen the impact on the area of existing residential <br />uses at County Road C-2 and Fairview Avenue. <br />Differentiation between commercial retail warehouse uses (Costco) and office <br />uses may require additional refinement of the existing zoning ordinance. <br />Economic Analysis <br />The final component of the analysis of the Costco proposal is economic <br />factors. <br />Jobs: Costco estimates that the facilityto <br />produce 150 full and part-time <br />jobs. This estimate stabilizes at a full time equivalent (FTE) of 105 jobs. <br />The type of job and income generation are summarized below: <br />Position <br />Salaried Management <br />Warehouse <br />Cashiers/Clerical <br />Average <br /># of Jobs Annual Income <br />10 $28,000 <br />47 17,000 <br />48 22,000 <br />The weighted average annual income for these jobs is $20,300. <br />Taxes: It is estimated that construction value of the Costco facility will be <br />$5.5 million. (Costco has indicated that the final cost may be as high as $6 <br />million. The cost of the 9.82 acre site is projected to be $21250,000. The <br />construction cost of the facility is estimated at $2,500,000. The remaining <br />$750,000 is for site preparation and improvements. <br />Assuming the $5.5 million construction value and an 80% conversion factor to <br />estimated market value, the taxable value of the Costco facility is calculated <br />below: <br />Construction Value <br />EMV Factor <br />Estimated Market Value <br />Assessed Value <br />1st $60,000 @ 28% <br />Remainder @ 43% <br />Total Assessed Value <br />$52500,000 <br />80% <br />4,400,000 <br />$ 16,800 <br />1,866.200 <br />1,883,000 <br />Based on a property tax mill rate of 99.838, the estimated assessed value for <br />the facility would result in annual property taxes of $186,112. <br />Costco has indicated that the site currently pays $44,000 per year in property <br />