Placer County closer to bringing Costco to Auburn

Published: Friday, Mar. 7, 2014 - 1:34 pm

Placer County officials announced Friday that they are close to reaching a tentative agreement with Costco to bring the warehouse retailer to the County Government Administrative Center in north Auburn.

The deal would bring jobs and revenue to the county, but some residents have criticized the plan for displacing a senior center and theater.

Under the proposed terms, Costco would pay the county $325,000 annually for the first decade, with 10 percent rent hikes every 10 years thereafter. The ground lease is for 20 years, with multiple options to extend. The county expects to net more than $20.5 million during the life of the initial lease.

As part of the proposal, Costco would contribute $530,000 to the nonprofit Auburn Senior Center, which would have to relocate. The senior center has long relied on rent-free facilities from the county to sustain its operations. Eric Hill, board president for the center, expressed relief, noting that without any financial support, the center would have shuttered.

“The senior center has been run like a club up until now,” Hill said. “This gives us five years to change our business model – charge a little more, get donations, do whatever is necessary to be fully self-sustaining.”

If the Board of Supervisors approves the tentative terms Tuesday, the county can move forward with a formal lease agreement that would allow Costco to enter the Auburn market as early as 2015. The proposed 148,000-square-foot warehouse would occupy 16 acres, and include 750 parking spaces and a gas station. It is expected to generate considerable sales tax revenue for the county and create 165 jobs. The closest Costco to Auburn now is in Roseville.

Costco representatives have declined to comment on the project, citing company policy.

The terms released by the county did not include provisions related to the DeWitt Theatre, which would have to be demolished for the Costco. Tenants of the World War II-era theater have criticized the county for not preserving what they called a historic building. The county has repeatedly said the building is not eligible for any historic registers.

“Retaining the facility did not fit into Costco’s plans,” said Mary Dietrich, facility services director for the county. “No other alternative has been negotiated.”

Michael Coder, owner of Music & More Arts Academy, the theater’s tenant since 1998, did not return calls Friday.

The entire 200-acre government center site dates back to 1943, when the U.S. Army built DeWitt General Hospital to treat war casualties and a theater to entertain troops. It was transferred to the state after the war and converted into a mental hospital. In 1972, the county gained control of the property when the hospital was shuttered.

Call The Bee’s Richard Chang at (916) 321-1018. Follow him on Twitter @RichardYChang.

Read more articles by Richard Chang

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