The La Verne Redevelopment Agency has agreed to loan Person Ford, the city’s largest sales tax producer, $300,000 and give the dealer up to $500,000 more over the next five years in exchange for his commitment to stay put.
Last week, the City Council, sitting as the Redevelopment Agency, voted 4 to 0 to loan dealership owner Warren Person $300,000 now, plus give him $100,000 a year for the next five years in order to make his rent more affordable. Mayor Pro Tem Robert Rodriguez was absent.
In exchange, Person, whose dealership generates about $250,000 a year for the city in sales tax, has agreed to keep his Foothill Boulevard dealership open another five years.
The agreement between Person and the city calls for the $100,000 payments to be made only if Person’s auto sales produce a minimum--and progressively larger--amount of sales tax revenue over the next five years.
In the first year, Person would have to generate at least $175,000 in sales tax revenue for the city, graduating to about $300,000 at the end of five years.
In April, Person told the city he was thinking about leaving town in favor of a better location elsewhere. He asked the council to lend him $500,000, or simply give it to him if his business produced enough sales tax revenue over the next five years. Person told the council he needs the money to cover rent, operating costs and capital improvements.
Council members say it is worth providing Person money to stay in town because if he left, the city would lose out on hundreds of thousands more each year in sales tax revenue.
City Manager Martin R. Lomeli said the $300,000 loan is secured by a combination of a first trust deed on the dealership property and certificates of deposit.