The City Council in Downey, Calif., unanimously approved an agreement with Giant RV on Tuesday, giving the business a sales tax rebate in exchange for significant job creation.
According to city staff, Giant RV will receive up to $504,000 over the course of seven years and create 55 new full-time jobs at the cite per the agreement. The RV dealership will use those proceeds to offset operational and facility costs.
This story by Alex Dominguez originally appeared in The Downey Patriot.
After the first year of operation, the city will examine the amount of sales tax produced by Giant RV. If that amount exceeds $180,000, the city will rebate the dealership 26 percent of the exceeding amount up to a maximum of $72,000 per year.
According to economic analysis run by the city on the site, a new dealership should bring up to $2.5 million in tax revenue to the city in the form of vehicle sales, part sales, service and property tax.
Mayor Sean Ashton admitted to having some reservations but conceded that the agreement could work.
“I always have my reservations about this,” said Ashton. “When I look at this and I’ve seen how it’s worked, I do actually see the benefit of this…I think in this case this is gonna be a great benefit to Giant RV and more importantly a great benefit to the residents of Downey.”