Costco’s plans for a $240 million Rock Hill distribution site are finally available for the public to see. For now, those plans are narrowly moving forward.
York County Council voted 4-3 on Monday to approve a $30 million infrastructure credit for the company. A final vote on that credit, and a public hearing, are scheduled for Dec. 1.
Backed by Costco representatives, York County Economic Development Director Mitch Miller offered public details on the project Monday for the first time.
What is Costco planning?
Costco Wholesale is the company behind Project Sample, the distribution site that the company would build in southern Rock Hill. In the first year, Costco would bring 125 jobs at an average wage of $28.24 an hour.
“That wage rate is a little higher because you’re going to have managerial positions that are going to come in first,” Miller said.
Within five years, the company projects 165 jobs averaging $26.66 an hour. That’s a projected $15 million in wages and benefits. Of the initial 125 jobs, 95 would be site operators. Another 18 would be laborers with nine managers and three clerical jobs.
The first phase would put a 541,000-square-foot linear building on the ground. The second phase would add perpendicular space on both ends, upping the total to nearly 900,000 square feet. That addition could come in 2036, Miller said.
The Costco site would open mid-2027 and serve 20 store locations across the Carolinas, plus some in Georgia.
Where would Costco go?
The distribution center would go on 168 acres at the intersection of Interstate 77 and Porter Road. The site is just north of Interconnect Drive. Roswell, Georgia-based Agnes Slack LLC owns the property, according to county land records.
Coming off the interstate, Porter Road runs for about 600 feet before it reaches a roundabout that would be constructed for the site at Interconnect Drive.
The property is zoned industrial, and a development agreement already allows warehouse and distribution uses. Costco would provide road improvements at the roundabout and space for an electrical station that could be used by other companies that come to the area.
“There’s a lot of land through there that is going to be developed at some point,” Miller said. “I think trying to be intentional to have a plan together with (the city of) Rock Hill is important.”
Three years ago, Rock Hill annexed and rezoned 27 acres off Interconnect Drive for an Old Dominion Freight Line truck terminal. At the same time, Strategic Capital Partners annexed and rezoned 50 acres just east of the Old Dominion site with plans for a six-building industrial park at a combined 3.5 million square feet.
Costco images shown to Council on Monday also showed those industrial park buildings just off Interconnect Drive.
“They are conceptual,” Miller said. “I can’t guarantee when that comes in, but it’s to give perspective of what a full build-out could look like.”
How would Costco impact traffic?
Costco projects to put 751 trucks and 244 cars on area roads each day in its first phase.
By its second phase build-out, those numbers increase to 1,247 trucks and 405 cars. Each vehicle in that projection would account for two daily trips, one coming and one going. Average daily trips is the standard unit for measuring traffic counts.
A full build-out count of about 3,300 daily trips from Costco is nearly twice the number of vehicles that merge northbound onto the interstate from Porter Road now, according to South Carolina Department of Transportation traffic counts
The Costco count is less than the 4,400 trips each day at the nearest Porter Road count site, just south of Oak Pond Road.
Costco expects its peak traffic to come in the 4-5 a.m. and 1-3 p.m. windows. The highest projected truck count at is at 1 p.m., with about 280 trucks.
“They’re trying to get ahead of both the morning traffic and the evening traffic,” Miller said.
Interconnect Drive would be the primary entrance and exit point for Costco truck traffic. Oak Pond Road also would get a new turn lane onto Porter Road.
What’s left to decide on Costco plan?
Costco projects it will make $44 million in infrastructure improvements, from road upgrades to property for an electrical station.
The decision Council faces is whether to credit Costco back with $30 million for making those upgrades, and as a means of competing for the project.
Without some type of economic incentive, county officials say, it would be almost impossible to bring large businesses to the area.
South Carolina has higher business taxes rates than North Carolina. Industrial properties, for instance, are taxed at 10.5% in South Carolina compared to 7% in neighboring Mecklenburg County without any tax incentives.
“We have to be competitive with the market we live in,” said Councilman Tom Audette.
While Audette sees a “field of dreams for other companies to come” due to road and electric upgrades, Councilman Andy Litten favored cutting the $30 million credit to $17 million. He would tie the credit to public road improvements but not upgrades on the Costco site itself.
“Paying them to give us their property or give Rock Hill the electrical station property, I can’t stomach that,” Litten said. “I just don’t believe in paying for or crediting back their own site improvements.”
Councilman William “Bump” Roddey supports the $30 million, but believes more of that money should come from Rock Hill. Typically with a project like this 62% of tax money would go to the Rock Hill School District, with the city getting 24% and the county 14%, said Councilman Watts Huckabee.
Roddey proposed getting the $30 million from Rock Hill foregoing all its revenue for a period, while the school district and county give up a little more than a third of what they would otherwise collect. The incentive agreement would run for 20 years, or until the credit reaches $30 million.
Because the city provides water, sewer and electricity, Roddey sees opportunity for Rock Hill to recoup more money than the county or school district could.
“We can massage the numbers and the percentages, still get there, and lessen our burden,” he said. “Lessen the school district’s burden. And maybe put more squarely on the shoulders of the city of Rock Hill because clearly they’re standing to get a lot more benefit than we are.”