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TAX DEAL REACHED OVER MALL TOWN CENTER GROWTH PLANNED.

Byline: Heather MacDonald Staff Writer

VALENCIA - Plans are under way for a five-year expansion of the Valencia Town Center and Town Center Drive after the City Council approved a tax sharing agreement.

The deal is expected to add $11 million to the city's general fund - and give The Newhall Land and Farming Company an equal amount to use for incentives and other enticements to draw more retailers to the mall over the 25-year life of the agreement.

``Sales tax has to be the City Council's first priority,'' said Councilman Cameron Smyth, echoing the other council members' desire to increase revenue.

Newhall Land is looking to bring at least two high-end retail department stores and several boutiques to the mall in an attempt to turn the commercial heart of Valencia into a regional center attracting shoppers from both the San Fernando and Antelope valleys.

The unanimous vote came after little debate, despite some opposition from residents who waited until the early morning hours of Wednesday for the council members to take up the issue.

``Newhall Land and Farming is a wealthy company and they should finance the expansion themselves,'' said Newhall resident Vera Johnson.

Other speakers argued that the agreement was a form of corporate welfare to Newhall Land, and called the council members hypocritical for rejecting plans for the 600,000-square-foot Golden Valley Ranch shopping center in Canyon Country.

``Why does everything have to be in Valencia?'' asked Canyon Country resident Berta Gonzales Harper. ``Golden Valley Ranch was going to give you more than $1 million, not asking you to share it with them.''

Newhall Land representatives told the council members they were looking to bring stores such as Macy's, Nordstrom or Dillards and to relocate the food court into the space now occupied by Edwards Cinema Theaters.

Edwards' parent company is reorganizing under bankruptcy protection and has indicated in court papers it plans to continue operations on Town Center Drive and in Canyon Country. The 10-plex in the mall was not included, leading Newhall Land to believe the company will close that theater, Newhall Land spokeswoman Marlee Lauffer said.

Moving the food court could make it more accessible, open it to more eateries and expand the seating, Lauffer said.

Lauffer said that Newhall Land is most focused on cutting deals with Macy's, Crate & Barrel and other upscale retailers.

The tax-sharing plan differs from one killed by the city two years ago that would have provided Nordstrom with a $20 million cash incentive to open at the Town Center. Under that plan, the city would have returned 20 percent of increased sales tax revenue to Newhall Land, which would have paid Nordstrom up front. The 50-50 plan won't raise as much money, but would encourage expansion, Lauffer said.

``This is similar, but a more realistic proposal,'' she said.

If the expansion does not increase sales tax revenue from the mall, no money will be shared with Newhall Land. Existing sales tax from the mall won't be used, city officials said.

Sales tax revenue makes up 36 percent of this year's city budget, and officials believe it will become even more crucial as development-related fees dwindle as the city approaches build-out.
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Publication:Daily News (Los Angeles, CA)
Date:Jul 12, 2001
Words:530
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