Rail Park Update

City Council received its first update of 2021 Monday from Stonemont CEO Zack Markwell (at podium). Councilman John Hancock, seated at left, remained firm in his doubts about project financing, but added he’d like to see the park built.  Also pictured is Mayor Pro Tem Eugene Bustamante.

The first rail-supported warehouses in the long-pending Southwest International Gateway Business Park could be operational within 18 months, developers told city council Monday, bringing an estimated 100 jobs.

El Campo City Councilman John Hancock, however, remains unconvinced, asking yet again for proof Stonemont has the funds to construct two million square feet in warehouse space along with the infrastructure to get it all running.

“We absolutely have the capital for it,” Stonemont CEO Zack Markwell told Hancock and the rest of council.

Five years in the making, the 540-acre development at the intersection of CR 421 and U.S. 59 was annexed into El Campo in 2019 as part of a development agreement.

Vitro Chemicals, a subsidiary of Vitro, one of the world’s largest glass manufacturers, may be the rail park’s first tenant, announcing its intention to locate there in February 2020.

A 125,000-square-foot distribution center for Vitro Chemicals was planned last year and a 200,000-square-foot speculative warehouse. That was delayed, however, as virtually all business in Texas shut down in response to the coronavirus pandemic.

Stonemont restarted its efforts in January, Markwell told council.

Plans call for some infrastructure to come from the Public Improvement District created to allow developers to charge tenants a tax-like fee between 60 cents and $1.20 per $100 in taxable value to pay for rail lines, water service and other utilities. The levy will only be for businesses inside the park’s boundaries.

Infrastructure costs, City Manager Courtney Sladek said, will be paid by the developer and new business inside the park, not taxpayers.

Hancock said he wanted to ensure no additional city dollars are spent without seeing building constructed on the site.

City taxpayers paid $397,500 for infrastructure engineering, planning for it to be oversized to accommodate growth in the area.

The City Development Center of El Campo, however, offered $3 million to assist the park with infrastructure costs. The city will issue that debt and be paid back by the CDC.

Council approved a third amendment to its agreement with developers Monday in a 4-2 vote with Council members Philip Miller and Anisa Vasquez against, giving the PID the tax like power and one year to start issuing debt.

All PID bonds would still need to be approved by council.

A $30,000 fund was created at the same session to ensure developer dollars are used for expenses.

“It draws down on that rather than spend taxpayer money,” Sladek said.

Council approved the fund unanimously.

Councilwoman Gloria Harris was not present for either vote.

Park developers are Stonemont, Ridgeline Property Group and NAI Partners. Watco Companies will operate the short line railroad connecting the buildings to the KCS main line.

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