Board Summary Starbucks Coffee Company P.O. Box 34442, S …

Board Summary

Starbucks Coffee Company

P.O. Box 34442, S-Tax, Seattle, WA 98124 Todd McCullough, Regional Distribution Manager

Manufacturing and Distribution

Date: July 17, 2017 Main Location: Carson City

Business Type: Expansion

County: Douglas County

Development Authority Representative: Andrew Haskin, NNDA

APPLICATION HIGHLIGHTS

- Starbucks Coffee Company is planning a 700,000 square foot expansion of its existing Douglas County facility. - The company will have an additional 30 acres of land remaining after the 700,000 square foot expansion. If growth continues, the company may

consider a further expansion using this vacant land at a later time. - The company was named 'Business of the Year' for Douglas County in 2016, for a variety of reasons, including its growth, benefits programs,

sustainability efforts and ongoing connection with the area.

PROFILE

Starbucks Corporation is an American coffee company and coffeehouse chain. The company was founded in Seattle, Washington in 1971. The company currently operates more than 24,000 retail stores in 70 countries. The Carson Valley Roasting Center and Distribution Center opened in Minden, NV in 2003 and services California, Nevada, and Utah, as well as parts of Arizona and Asia Pacific. The Carson Valley facility is also the site of the first Starbucks Inclusion Academy. Launched in 2014, it provides six weeks of training to help individuals with disabilities gain meaningful work experience in manufacturing, warehousing, and distribution. Source: Starbucks Coffee Company

SIGNIFICANCE OF ABATEMENTS IN THE COMPANY'S DECISION TO RELOCATE/EXPAND The abatements and incentives offered by Nevada will assist the company to facilitate further growth. The addition of Starbucks jobs in Douglas County will provide employment diversity in a region where one-third of the workforce holds lower-paying tourism and leisure positions. Douglas County officials support this expansion, as they focus on growing the industrial sector as well as the number of working families in their region. Source: Starbucks Coffee Company

REQUIREMENTS Job Creation Average Wage Equipment Capex (SU & MBT) Equipment Capex (PP)

Statutory 36

$19.36 $1,440,538 $1,440,538

Application 99

$21.16 $4,448,000 $4,448,000

Sufficient Yes Yes Yes Yes

% Over / Under 175% 9% 209% 209%

INCENTIVES Sales Tax Abmt. Modified Business Tax Abmt. Personal Property Tax Abmt. Total

Requested Terms 2% for 2 years 50% for 4 years

50% for 10 years

Estimated $ Amount $226,848 $104,002 $72,982 $403,832

JOB CREATION

Contracted 36

24-Month Projection 99

5-Year Projection 113

OTHER CAPITAL INVESTMENT

Land $0

Building Purchase $0

BTS / Building Improvements $48,500,000

ECONOMIC IMPACT ESTIMATES (10-Year Cumulative)

Total

Construction

Total Jobs Supported

161

508

Total Payroll Supported

$63,692,251

$17,065,818

Total Output Estimate

$195,455,598

$72,214,154

Estimate includes jobs, payroll & output by the company assisted as well as the secondary impacts to other local businesses.

NEW TAX REVENUE ESTIMATES (10-Year Cumulative) Local Taxes Property Sales Lodging State Taxes Property Sales Modified Business Lodging Total

Direct

$5,401,439 $1,607,775

$0

$263,107 $719,460 $482,544

$0 $8,474,325

Indirect

$2,329,533 $459,285 $36,162

$248,788 $394,892 $241,682

$1,043 $3,711,385

Total

$7,730,972 $2,067,060

$36,162

$511,895 $1,114,352 $724,226

$1,043 $12,185,710

IMPACT ASSESSMENT

Economic Impact per Abated Dollar $484

New Total Tax per Abated Dollar $30.18

EMPLOYEE BENEFITS - Percentage of health insurance covered by company: 70%. - Health care package cost per employee - $4,170 annually with options for dependents. - Overtime, PTO/Sick/Vacation, COLA Adjustments, Tuition Assistance, Retirement Plan / Profit Sharing / 401(k), Merit Increases, Bonus.

NOTES - Percentage of market outside of Nevada: 85%. - The company is also considering Washington and California as potential locations.

June 2nd, 2017 Steve Hill Executive Director Nevada Governor's Office of Economic Development 555 E. Washington Ave., Suite 5400 Las Vegas, NV 89101

RE: Request for Incentives from the Nevada Governor's Office of Economic Development

Dear Mr. Hill, Starbucks Coffee Company is hereby requesting the Nevada Governor's Office of Economic Development provide economic incentives for the company to expand at their current facilities at 2525 Starbucks Way, Minden, NV 89423. The Carson Valley Roasting Center and Distribution Center opened in Minden, NV in 2003 and services all of California, Nevada, and Utah, as well as parts of Arizona and Asia Pacific. The 700,000 square foot expansion will add 113 jobs on-site, including managerial, supervisory, and coordination and distribution partnership roles. Only the distribution portion of the building will be enlarged; the roasting side of the operation will remain unchanged. The expanded portion is planned to break ground in June 2017 and is expected to be up and running in Q3 2018. Sales and Use Tax, Personal Property Tax, and Modified Business Tax Abatements were a significant factor in the decision to expand in Nevada. The addition of Starbucks jobs in Douglas County will provide employment diversity in a region where one third of the workforce holds lower-paying tourism and leisure positions. Our hope is local political leadership is excited about this potential expansion, as they try to grow the industrial sector in their region. Starbucks was named Business of the Year for Douglas County in 2016, and continues to be a vital contributory member of the community, volunteering thousands of hours of community service and making sizable donations to local nonprofits. We plan on continuing those efforts with this potential expansion. Starbucks will have an additional 30 acres of land remaining after the 700,000 square foot expansion. If growth continues, the company may consider a further expansion using this vacant land at a later time.

Sincerely, Todd McCullough Starbucks Coffee Company

Incentive Application

Company Name: Date of Application:

Starbucks Coffee Company June 9, 2017

Company is an / a: (check one) New location in Nevada Expansion of a Nevada company

Section 1 - Type of Incentives

Please check all that the company is applying for on this application:

Sales & Use Tax Abatement

Sales & Use Tax Deferral

Modified Business Tax Abatement

Recycling Real Property Tax Abatement

Personal Property Tax Abatement

Other:

Section 2 - Corporate Information

COMPANY NAME (Legal name under which business will be transacted in Nevada)

FEDERAL TAX ID #

Starbucks Coffee Company

91-1325671

CORPORATE ADDRESS

CITY / TOWN

STATE / PROVINCE

ZIP

P.O. Box 34442, S-Tax

Seattle

WA

98124-1442

MAILING ADDRESS TO RECEIVE DOCUMENTS (If different from above)

CITY / TOWN

STATE / PROVINCE

ZIP

2525 Starbucks Way

Minden

NV

89423

TELEPHONE NUMBER

WEBSITE

775-267-6142



COMPANY CONTACT NAME

COMPANY CONTACT TITLE

Todd McCullough

Regional Distribution Director

E-MAIL ADDRESS

PREFERRED PHONE NUMBER

tmccullo@

775-267-6142

Has your company ever applied and been approved for incentives available by the Governor's Office of Economic Development?

Yes

No

If Yes, list the program awarded, date of approval, and status of the accounts (attach separate sheet if necessary):

Section 3 - Program Requirements

Please check two of the boxes below; the company must meet at least two of the three program requirements:

A capital investment of $1,000,000 in eligible equipment in urban areas or $250,000 in eligible equipment in rural areas are required. This criteria is businesses. In cases of expanding businesses, the capital investment must equal at least 20% of the value of the tangible property owned by the business. New businesses locating in urban areas require fifty (50) or more permanent, full-time employees on its payroll by the eighth calendar quarter following the quarter in which the abatement becomes effective. In rural areas, the requirement is ten (10) or more. For an expansion, the business must increase the employees on its payroll by 10% more than its existing employees prior to expansion, or by 25 (urban) or 6 (rural) employees, whichever is

greater.

In urban areas, the average hourly wage that will be paid by the business to its new employees is at least 100% of the average statewide hourly wage. For in rural areas, the average hourly wage will equal or exceed the lesser of the county-wide average hourly wage or statewide average hourly wage.

Note: Criteria is different depending on whether the business is in a county whose population is 100,000 or more or a city whose population is 60,000 or more (i.e., "urban" area), or if the business is in a county whose population is less than 100,000 or a city whose population is less than 60,000 (i.e., "rural" area).

Section 4 - Nevada Facility

Type of Facility:

Headquarters

Service Provider

Technology

Distribution / Fulfillment

Back Office Operations

Manufacturing

Research & Development / Intellectual Property

Other:

PERCENT OF COMPANY'S NEVADA LOCATION MARKET OUTSIDE OF NEVADA

~85%

EXPECTED DATE OF NEW / EXPANDED OPERATIONS (MONTH / YEAR)

Q3 2018

NAICS CODE / SIC

NAICS 722513 - SIC 5812

INDUSTRY TYPE

Accommodation and Food Services

DESCRIPTION OF COMPANY'S NEVADA OPERATIONS

Manufacturing and Distribution

PROPOSED / ACTUAL NEVADA FACILITY ADDRESS

2525 Starbucks Way

CITY / TOWN

Minden

COUNTY

Douglas

ZIP

89423

WHAT OTHER STATES / REGIONS / CITIES ARE BEING CONSIDERED FOR YOUR COMPANY'S RELOCATION / EXPANSION / STARTUP?

States: WA, CA

1

Section 5 - Complete Forms (see additional tabs at the bottom of this sheet for each form listed below)

Check the applicable box when form has been completed.

5 (A) Equipment List 5 (B) Employment Schedule 5 (C) Evaluation of Health Plan

Section 6 - Real Estate & Construction (Fill in either New Operations/Startup or Expansion, not both.)

New Operations / Start Up - Plans Over the Next Ten Years

Expansions - Plans Over the Next 10 Years

Part 1. Are you currently/planning on leasing space in Nevada?

If No, skip to Part 2. If Yes, continue below: What year(s)?

How much space (sq. ft.)? Annual lease cost of space: Do you plan on making building tenant improvements? If No, skip to Part 2. If Yes * , continue below: When to make improvements (month, year)?

Part 2. Are you currently/planning on buying an owner occupied facility in Nevada? If No, skip to Part 3. If Yes * , continue below:

Purchase date, if buying (month, year): How much space (sq. ft.)?

Do you plan on making building improvements? If No, skip to Part 3. If Yes * , continue below:

When to make improvements (month, year)?

Part 3. Are you currently/planning on building a build-to-suit facility in Nevada?

If Yes * , continue below: When to break ground, if building (month, year)? Estimated completion date, if building (month, year):

How much space (sq. ft.)?

Part 1. Are you currently leasing space in Nevada?

No

If No, skip to Part 2. If Yes, continue below:

What year(s)?

How much space (sq. ft.)?

Annual lease cost at current space:

Due to expansion, will you lease additional space?

If No, skip to Part 3. If Yes, continue below:

Expanding at the current facility or a new facility?

What year(s)?

How much expanded space (sq. ft.)?

Annual lease cost of expanded space:

Do you plan on making building tenant improvements?

If No, skip to Part 3. If Yes * , continue below:

When to make improvements (month, year)?

Part 2. Are you currently operating at an owner occupied building in Nevada?

If No, skip to Part 3. If Yes, continue below: How much space (sq. ft.)?

Current assessed value of real property? Due to expansion, will you be making building improvements?

If No, skip to Part 3. If Yes * , continue below: When to make improvements (month, year)?

Yes

362,911 $6,877,500.00

Yes

Q3 2017

Part 3. Do you plan on building or buying a new facility in Nevada?

If Yes * , continue below: Purchase date, if buying (month, year): When to break ground, if building (month, year)? Estimated completion date, if building (month, year):

How much space (sq. ft.)?

Yes

N/A Jun-2017 Jun-2018 720,000

* Please complete Section 7 - Capital Investment for New Operations / Startup.

* Please complete Section 7 - Capital Investment for Expansions below.

BRIEF DESCRIPTION OF CONSTRUCTION PROJECT AND ITS PROJECTED IMPACT ON THE LOCAL ECONOMY (Attach a separate sheet if necessary):

The Carson Valley Roasting Center and Distribution Center opened in Minden, NV in 2003 and services all of California, Nevada, and Utah, as well as parts of Arizona and Asia Pacific. The 700,000 square foot expansion will add 113 jobs on-site, including managerial, supervisory, and coordination and distribution partnership roles. Only the distribution portion of the building will be enlarged; the roasting side of the operation will remain unchanged. The expanded portion will break ground in June 2017 and is expected to be up and running in Q3 2018. The addition of Starbucks jobs in Douglas County will provide employment diversity in a region where one third of the workforce holds lower-paying tourism and leisure positions. Douglas County officials are excited about this expansion, as they try to grow the industrial sector as well as the number of working families in their region. Starbucks was names Business of the Year for Douglas County in 2016, and continues to be a vital contributory member of the community, volunteering thousands of hours of community service and making sizable donations to local nonprofits.

2

 ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download