Is Outlet Mall Worth the Price?

A breakdown of how much money Livermore will get from mall revenue.

Love it or hate it, the one thing that seemed evident from the crush of customers storming the new outlet mall was Livermore must be ringing up a lot of cash for the city coffers.

Cha-ching turned to cha-what after talking to Mayor John Marchand and Assistant City Manager Troy Brown on Monday.

They told me the outlet mall is expected to produce approximately $2 million in projected annual sales tax revenue, although that’s all just guesswork until the actual money hits the bank sometime after the first fiscal quarter.

My heart fluttered. I started thinking about all the things that money could buy — reopening the Springtown library, bringing in more services, chipping in for Fourth of July fireworks. The list was just beginning, and I was growing more forgiving of the traffic tie-ups that have largely been contained to just the exit lane on the freeway.

But then I learned that half the money would be going back to the developers. I don’t claim to know all the ins and outs of financing such projects, or if this is standard procedure. All I know is the money given is to be used for funding “public improvements,’’ and Brown says the developer is only being reimbursed a portion of those costs.

The total eligible amount for reimbursement is about $15 million, so if they collect a million a year, this would continue for about 15 years before the city gets the entire tax.

But if, for example, in one year the sales tax was only $1.5 million, the city would still collect their $1 million, but the developer would only get $500,000. That would prolong the time before the $15 million cap would be reached.

Let’s make this clear: The first million goes to the City of Livermore, the second million goes to the developers. Anything less than $2 million is taken out of the developer’s share. Anything more than $2 million goes back to the city.

So for our purposes, we’ll just move on to Livermore’s projected income, which has now been chopped to $1 million — still a sizable amount.

We can still get a lot of bang with a million bucks. Except it isn’t a million going into the general fund.

Out of that money, the city needs to put about $600,000 out for maintenance and city services for the mall, according to Brown and Marchand. The city had already brought on four new police officers, with three more coming on July 1, 2013, all because of the mall and the reinstated gang and drug task force.

(As a side note, I think the officers are better suited to patrolling the parking areas where break-ins have been occurring than directing traffic — a task any civilian who has worked the Alameda County fair could perform. I’ve seen zero police presence in the pitch-black overflow parking areas, and quite a few manning the intersections that could probably flow just as well using the traffic lights.)

But back to the bottom line.

“At the end of the day, the city will get about $400,000,” says Brown of the projected funds. “That money isn’t earmarked for anything right now and will go into the general fund.”

So it boils down to this: Is the $400,000 worth the I-580 traffic jams to Livermore residents?

Perhaps. It does bring some money into our city directly, and there’s hope the mall will raise Livermore's profile — which it has already accomplished. More importantly to city officials is the belief the mall will have a halo effect by creating interest in outlet shoppers to come to downtown Livermore to shop, eat and even venture out to the wineries.

Personally, I don’t think that’s actually going to happen — at least not until there’s some nice hotels to accommodate vacationers who would include a trip to the outlets as part of their plans.

I’m not really into retail therapy, but when I’ve gone to other outlet malls for a day trip I’m like most bargain shoppers who have their eye on the prize — saving money, then getting the heck out.

Sandy November 30, 2012 at 02:33 PM
Yeah..... Right. Outlet shoppers are going to get in their cars and head on over to Downtown Livermore to.....what?..... Shop? At best, they'll hit up a restaurant. But even that's reaching. Bottom line ...... NOT gonna happen. I'm sick they built this monstrosity, and in an already heavy traffic location. WTH????? And now for maybe a $400,000 annual boost, of which we have no idea where it's going? One of the top reasons for us residents voting down the north- side housing project years ago, was because of the traffic impact it would have. Well, here we are. At least with that we'd have gotten a new sports park. To the City Managers: STOP!! Most of us like our little hometown Livermore. The wineries already put us on the map. We did not need an outlet mall to do that!!! But now that it's there..... Will one of you please tell us where you plan on spending that..... unm.......revenue? Or do we have to go to a city council meeting to get that answer? Please tell us it'll be for IMPROVEMENTS and not to build something else!
Trevor Tooze November 30, 2012 at 02:51 PM
You say we need "nice hotels". For a city the size of Livermore, we have more than the average number of "nice" hotels. Namely; Doubletree Hotel, Hawthorne Suite, Best Western Vineyard Inn, La Quinta Inn, Holiday Inn Express, Hilton Garden Inn, Quality Inn & Suites. All of these are very close to freeway access, and let us not forget the Purple Orchid Inn & Spa, slap dab, right there in the wine country, and in downtown on First Street, there is Americas Best Value Hotel. There is, not what I call a shortage of hotels in Livermore.
david November 30, 2012 at 03:39 PM
Oh let the naysayers begin their criticisms of everything they personally do not like. The outlet, not unlike Stoneridge Mall, is a shopping mecca - what were you expecting the second coming of Christ? It is what it is, so get over it.
Styler November 30, 2012 at 04:11 PM
No sure why my first post didn't go through. But yes, if you want answers then go to a council meeting, don't sit behind your computer and expect the answers to come and find you. And if you didn't go to a council meeting to oppose the outlets then you really have no grounds to complain, you can't expect other residents to voice your opinion for you. If you oppose something so strongly you would have been out there trying to stop it. I have been to the outlets 3 times already and can't wait to go back again.
Livermore Fan November 30, 2012 at 04:27 PM
Paragon has done an amazing messaging to the Greater Bay Area that Livermore Valley exists. The " come to Paragon in Livermore" soundbites were always rolled in with a "also boasting a thriving downtown and booming wine country" message. Guess what.... We are already seeing the run off of Paragon Outlet visitors venturing into Livermore Downtown and discovering the jewels that are here. Wineries are partnering through events on-site at Paragon and getting increased exposure to a new audience of consumers. It is happening and will grow even more. Not sure why so many Patch writers and readers seem to want everything to have a sad ending. We now have so many options right here in our community and as a 30 year resident of Livermore who has raised my children here... I say...AWESOME!
Marie November 30, 2012 at 04:44 PM
I don't mind the outlet but they could have thought ahead to traffic and parking. It is also ridiculous to pay all those cops out there for what to direct traffic come on. They should at least be patrolling the parking lot and mall. There are something that they can improve on.
Sandy November 30, 2012 at 05:25 PM
@david. ..... The coming of Christ??? Really?? That was a stupid comment. @styler.... I do attend city council meetings. Do you? Have you written letters to the mayor? I have. But my suggestions and complaints have gotten me nowhere. Started years ago with the homeless situation. Since then...... It's gotten WORSE!! So don't sit on your high horse and tell me what I haven't done. You will lose that argument. The two of you obviously don't have to get onto 580 much, do you? Try it now.....then tell me how "awesome" the outlets are. And I for one love Stoneridge...... Advice to the city...... Add more security. It's cheaper. They can get around the parking lot with segways and small vehicles. Police officers standing around will not do a thing to prevent the thefts that have occurred and will continue to occur in the future. You want to see where that $400,000 will go? There you have it. Cops are expensive. And they deserve every penny they make.... @ Livermore fan..... I too love Livermore. Been here for years. Raising my kids here. I don't want the "consumer exposure." Guess it's just me being selfish in not wanting MORE people in our community, raising the crime rate. I must be off my rocker.......
Marie November 30, 2012 at 05:36 PM
I think Styler works for the mayor she's always talking him and the town up. We are what makes up livermore not money or stores. They need to think about people and their families.
Julia November 30, 2012 at 05:57 PM
Sandy... Well said... I'm with you in not wanting MORE people moving to Livermore & no we don't need MORE giant shopping arenas or theaters or luxury hotels. We do need a Whole Foods or ?? to take over an existing empty shopping center. We have several to choose from: Vasco (old PW supermarket site) N. Livermore (I believe it was an old Lucy's site) or downtown at Railroad (the old Safeway site?). I'm sure there are several other existing locations that would be suitable for a Wholefoods store.... no need to build new, re-use & re-model.
david November 30, 2012 at 06:37 PM
Sandy: a little to sensitive on a different opinion than yours! Your arguments/complaints were used to try to stop Stoneridge, the Bankhead, downtown improvements (and there is more down there now than ever). Costco, Target etc etc. Our democracy permitted these changes (not all of which are good to everyone), but that is how things work. Enjoy it and Merry Christmas.
Styler November 30, 2012 at 06:46 PM
Just because I am always talking positively about the Mayor and Livermore does not automatically mean that I work for him. Maybe I am proud to live in Livermore and like the way things have been going since Mayor Marchand took over. Just because my opinion differs from yours doesn't automatically mean I have ulterior motives for my positivity when it comes to Livermore.
Paisley November 30, 2012 at 06:56 PM
I am skeptical of people coming to the downtown area after hitting the malls. The only saving grace is it's easy to get OUT of the mall. Every minute people spend in traffic - they are not spending money in your town. I go to an airshow in half moon bay, and always want to stop to eat before leaving. But the traffic is so horrible I never do. It makes you tired and you just want to leave. Most successful malls these days use restaurants as the anchor stores. Some malls in fact are half dead, and the good restaurants are the only thing keeping them alive. Regarding the kickbacks. It's probably because the city forces them to do infrastructure. Like what wallmart had to do before they were turned down. Making all those roads to nowhere out by the waste plant.
Darwinian Justice November 30, 2012 at 07:04 PM
"I don’t claim to know all the ins and outs of financing such projects, or if this is standard procedure." Then why in the hell can we look at any of this article as definitive? Why is this getting top billing? Patch has become a bulletin board for a bunch of pseudo-experts that are writing directly out of their butts, or partially out of their butts with a few numbers thrown in. A few months ago I could count on the front page to have something useful, but now any schmuck with some bone to pick apparently now has access. If I wanted opinion on the front page, I'd go find a f'ing blog. I guess if I want news this place is going to be a crap-shoot, with an extra-large helping of crap.
Sandy November 30, 2012 at 07:32 PM
@david: with all due respect. I was 100% for Bankhead. Loved the idea. Still do. But opposed to a bigger theatre just down the road..... When, yes..... a Whole foods would be great!!! Money better spent to benefit us here in Livermore. Stoneridge? Well, that's in Pleasanton. Costco? Really? That's a well thought out comparison, sir, considering the folks of San Leandro, Hayward, Fremont and the like wont be traveling to it! But they certainly will travel to an outlet mall. Downtown..... was totally for those improvements. Love not having to travel to P-town to dine at a nice restaurant. Hell, they're coming here now. And that IS awesome!!! Target? Okay....I'm wasting my time now.
Julia November 30, 2012 at 07:43 PM
Trevor, I say we DO NOT need additional hotels, theaters or massive shopping arenas. We have existing neighborhood strip malls that are dying a slow death due to the lack of a good anchor store. The addition of Trader Joe's on 1st is a fine example of how to revive a strip mall. I see no need to build more of anything. More open space is needed... not more buildings or houses.
Matt November 30, 2012 at 09:31 PM
Oh the sky is falling, once again. (Maybe a bad pun with all the rain today). Of course traffic is bad. The recent 580 improvements were at least 20 years overdue, and as usual with road projects, didn't even adequately address the current issues, never mind account for any future growth. As other cities around us grow and thrive, traffic will continue to get worse, even as Livermore stagnates due to its selfish and short-sighted no-growth policy. So don't blame the outlets. If Livermore hadn't done it, Dublin would have been more than happy to. Then we'd have the same traffic issues but without even $400k. You can't stop progress, though many in Livermore try. Projects like Paragon at least let us reap some benefit, unlike what will happen as we continue to bury our head in the sand while others grow. And when you are looking at that benefit, also take into account the number of Livermore residents that are happy the Outlets are nearby for them to utilize. Now they don't have to drive to Tracy, Gilroy, Vacaville, or even Stoneridge in some cases.
MTOL November 30, 2012 at 11:10 PM
Did the writer say the mall helps to pay for the reinstated gang and drug task force? I'd say that is money very well spent! An outlet mall isn't what I would've chosen, but it is here now, so now I am hoping the city council will do everything they can to make sure it helps Livermore. A start to this would be for us to keep the conversation constructive AND to communicate to the public and city council any specific ideas we might have on how Livermore can ensure that this mall does bring people to our downtown and wineries. This story is still unfolding, so get involved if you have good ideas!
G December 01, 2012 at 12:44 AM
Why is it all about the money that the city will get?? Either myslef or my daugther know at least one person in most of the stores who had been trying to find jobs and now they have jobs and are being productive members of our city - they are learning skills and can stay here in the community and attend school at Los Positas and work here! I think there are many positives that are there if you just look
Tom Ness December 01, 2012 at 01:30 AM
Good point Matt, if Livermore did not build it, it would of ended up on Dublin's side of the freeway. Then we would be stuck with all of the traffic and issues with none of the money for livermore and none of the police officers. I have enjoyed the outlet and only found traffic to be bad on opening weekend and Black Friday. Go by anytime in the week and it easy in and out no problem, which i am sure will be the case after the holidays. Quit complaining people, Its the happiest time of the year. Be greatfull we live in a place we can even complain about a shopping center, some people in the world cant even have clean water to drink
Darwinian Justice December 01, 2012 at 01:30 AM
If it bleeds, it leads. This isn't blood, but it's that same sort of negativity. Apparently the only way Patch can get pageviews these days is by putting the equivalent of letters to the editor on the front page instead of news. It seems these days that if there are new jobs created, there is immediate criticism that there aren't enough created or they don't pay enough. The criticism comes from losers and the self-entitled. The fact is that more people are working because of this mall, and it employed a lot of people during the construction. How many jobs have YOU created, losers?
Mr. Mike to you December 01, 2012 at 02:04 AM
Hear no evil, see no evil, speak no evil... I personally do not mind the mall, what I do mind is all the additional traffic on the existing 84, and the widening coming to late and particularly the wrong end. It should be widened over pigeon pass all the way to 680 and a rerouting of Vallecitos, that's the light that holds up 84. Rumor has it that a new entry for all the gravel and cement trucks will be at Concannon with a 4 way stop. Is this true? If so why has no public input been asked for from the immediate surrounding area? Does the City of Livermore have any interaction with CalTrans?
Sandy December 01, 2012 at 02:34 AM
@Darwinian justice ....... I have created about 400 jobs. How many have YOU created? I am far from that loser you speak of!! My company hires people every day. Yes..... EVERY DAY. I am simply opposed to the outlet because of the traffic it creates, number one; and number two, the crime it will bring in to our city. As if it isn't bad enough. I don't speak out of my butt..... I speak of facts. I just hope we're prepared for it. @G...... Well said. I do agree with the job creation the outlet has brought. I am utilizing my right to freedom of speech....... Period. Merry Christmas !!!
Darwinian Justice December 01, 2012 at 05:23 AM
So you'd rather that all of those people were at home right now instead of working, so your commute was easier. Nice.
Sandy December 01, 2012 at 05:10 PM
Mr. Darwinian Justice...... You did not answer the question: how many jobs have you created in your lifetime? And you obviously don't have a job, as you have no idea how frustrating it is to get to work while others are tying up traffic so they can shop. Not their fault, of course. How about looking into other locations? Did you know that that stretch of highway is in the top ten WORSE traffic congestions in the state? It cold have been better thought out. That's my point. You're barking up the wrong tree when it comes to the job creation issue, my friend. And when it's your car broken into next in the under staffed parking lot, I look forward to your comments then.
Darwinian Justice December 01, 2012 at 09:33 PM
Your sense of entitlement is disgusting. To answer your question, I've worked for decades without a single day off work, and on any given day in the Bay Area I'm on the road for 3-4 hours on 580, 680 and 880, so yes, I do know the frustration. The difference is that I can suck it up and deal with it, because it is employing other people and thus putting food on the table. I can deal with it too because it brings in tax revenue and it gives people in the area more choices than the poor options nearby. You should drive by the outlet today. It is busy, but 580 isn't slow by any means. Ever heard of a grand opening? They have traffic. Then things settle down pretty shortly after. As for jobs, I've created at least 38 over the past 5 years in a recession, and one way or the other that's pretty irrelevant. What is relevant is that I don't look down my nose when it comes to people getting jobs, and I don't look at traffic trouble during a grand opening and assume that it will always be that way. And as for the understaffed parking lot? Last time I was there they had two people in the lot, and it wasn't during the grand opening. Try not to run over any orphans or puppies on your oh-so-busy commute home. I hear that the outlet staff is dropping them off of the overpass, just to slow you down in particular.
Darwinian Justice December 02, 2012 at 01:02 AM
Clarification: without a single day of being unemployed.
Mark Tarte December 02, 2012 at 07:41 AM
I believe the estimates of sales and taxes from the sales are low. When the Target/Mervyns shopping center went in about 22 years ago, there was surprise in city hall that so many people from Livermore shopped there. One of the stories floating around then was that the sales tax revenue was underestimated by almost 300%. Not sure if that is true, but I suspect the 2 million a year is conservative. As one poster said, Paragon was going to build regardless. If it had been north of the freeway in Dublin, the same traffic problems would exist. I'm glad to see it in Livermore, if only for the tax revenue. However, the idea floated by its original backers in the city council that it would be a magnet for downtown is laughable by about 6 road miles.
Becky December 26, 2012 at 06:19 AM
I was surprised at how little landscaping there is at the outdoor mall. It's going to be baking in the summer. And who will want to shop there when it's pouring. I thought Livermore had high standards for landscaping.
Ben February 04, 2013 at 09:26 AM
People, What Highway 84 needs is for truck traffic to be removed from Sr-84 & kept on the 560-680 route & not more trucks which is what lane widening has done. Keep the road free for regular commuters as intended & not jam it up with slow moving lumbering trucks which are already taking to the road in droves. It's only a question of time before this road becomes fatality lane for our families from all the truck traffic that has the same idea . Ask your city council & Caltrans to do do something & stop through truck traffic. Sign the below.. http://www.change.org/petitions/ban-big-rigs-on-highway-84


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