GONZALES — City councilmen voted unanimously Tuesday to enact a 1-cent sales tax increase at Tanger Outlet Center as part of a new economic development agreement.
The tax increase, to be collected through the newly created Tanger Mall Economic Development District, will go into effect July 1 and have a 20-year life span, according to the adopted ordinance.
Increasing the sales tax in Tanger stores from 8.5 cents to 9.5 cents, the new tax will join with the existing 2 cents in sales taxes collected by the city from sales at Tanger, City Treasurer and Clerk Clay Stafford said.
According to an approved cooperative endeavor agreement between the two entities, revenue from the new tax will be split, with Tanger receiving 70 percent of the additional income.
Mayor Barney Arceneaux said the city will use its 30 percent share of the collections to improve infrastructure near the shopping center.
He cited the intersection of La. 30 and Robert Wilson Road as a prime target for improvement.
“It’s so busy right there with traffic not only for Tanger, but from the plants and the Lamar-Dixon Expo Center,” he said. “We need to make improvements to accommodate that volume.”
Tanger is off La. 30 near Interstate 10 east.
The mayor said plans also include a possible roundabout and an additional entrance to Tanger in the future.
Tanger hopes to use its share of the revenue to fund an additional 30,000 square feet in retail space at a cost of about $10 million, Arceneaux said.
This includes up to five new businesses in the center, he said.
The increased tax only applies to business within the Tanger structures, Arceneaux said, and does not apply to outlying restaurants and gasoline stations.
Stafford has said while it is unclear how much the new tax would generate annually, he estimated it could bring in between $800,000 and $1 million per year total.
“Our 30 percent of that could be about $300,000 or so,” Stafford said. “We’re also making projections on the current 2 percent in taxes. With the new stores that come in, that could mean another $600,000 or $700,000 for the city.”
Tanger officials have told city officials they plan to break ground on the planned expansion in September, with completion expected by summer 2013.