Written by The Business Journal Staff
Fresno continues to push for economic magic bullets, while at the same time enjoying organic growth from area businesses.
The latest big fish on the hook is Illinois-based Ulta Cosmetics, which has tapped Fresno as one of three cities where it plans to build a $110 million fulfillment center. This week (after press time), the Fresno City Council is set to vote on an incentive package that would top out at $18 million over a 30-year term.
Ulta told the city the fulfillment center could create up to 1,200 jobs.
It may seem like déjà vu to some who followed the Nordstrom story earlier this year. Both Fresno and Visalia approved multi-million-dollar tax incentive plans to lure a Nordstrom e-commerce fulfillment center that would’ve created up to 370 jobs. Ultimately, Nordstrom pushed any such decision until as late as 2020.
The Ulta development appears to reaffirm Mayor Ashley Swearengin’s recent comments in published reports that there are “a significant number of economic development projects that are still confidential, but are to the point where they’re talking to us about locations and those sorts of things.”
She said these projects add up to “thousands of jobs in the pipeline.”
In an interview earlier this week, Larry Westerlund, Fresno’s economic development director, was hesitant to discuss any individual projects, but asserted that fulfillment centers like Ulta’s and Nordstrom’s continue to present themselves as sterling opportunities for centrally located Fresno.
Landing these big fish is increasingly a delicate balancing act when it comes to offering incentives. Fresno City Councilmember Lee Brand (now mayor-elect) help set some groundwork earlier this year with his Economic Expansion Act, which promised to provide “a road map for practical and effective use of city resources to support job creation, economic expansion and citywide revitalization,” according to Brand.
The act kicks in with the latest Ulta proposal, which offers a slate of tax incentives based on actual employee hires — $15,000 per direct, full-time employee, $10,000 per full-time contract employee and $5,000 per contract, full-time equivalent position comprised of part-time contract positions.
But Brand is also bullish on local organic growth, especially in a burgeoning tech sector many see as the future for the Fresno region. He attended a press conference this week to announce Fresno-based BCT Consulting’s acquisition of two Bay Area tech firms. Institutions such as Fresno State and Bitwise Industries are expanding training opportunities for jobs in the technology sector — jobs that are sorely needed, Brand said.
“It’s a top priority to develop these advanced industry jobs,” Brand said. “These are the kinds of jobs Fresno needs.”
Westerlund pointed to high-speed rail as an opportunity for the region to appear competitive with existing technology centers in the state. He recounted a visit he made earlier this year to Silicon Valley with Swearengin to sell Fresno as a destination for tech businesses to top executives.
The rail system promises to promote higher-level connectivity between different parts of the state, including Fresno to Silicon Valley.
“The interest really turned up when we were talking about high-speed rail,” Westerlund said.
Construction of the rail system has ramped up in the Fresno area of late, and in addition to construction jobs, business relocation activities have proven to be an economic driver. Westerlund pointed to businesses such as OK Produce, which recently had to relocate as a result of rail construction. The firm managed to find a location, and even added an additional 100 jobs.
“Because they have been forced to move, many are expanding,” Westerlund said.
Another big fish associated with the rail system is a heavy maintenance facility, which would create upwards of 1,000 jobs. Fresno, Kings and Madera counties are all eyeing the facility for their own communities. A decision is expected in the New Year.