Merced supervisors approve group discussions on Los Banos industrial park

It’s the first in the journey of a million steps, but Los Banos City Manager Steve Carrigan called it a victory.

On Tuesday, the Board of Supervisors authorized county staff participation in a working group to discuss a proposed industrial park in the West Side of Merced County. The supervisors also accepted the project’s “guidance package,” a document that outlines the project details, and approved receiving quarterly updates about the endeavor.

The action taken by county supervisors doesn’t mean the project has been approved or that the county is chipping in financially. But Carrigan said it still represents an important first step.

“Today was really significant because I heard from each one of the supervisors and was happy with the comments,” Carrigan said after the board meeting Tuesday. “It sounds like we are a team now, and we’re moving forward together.”

The project, under discussion for more than a year, was first presented to the Board of Supervisors last month. The plan is to build a “shovel-ready” industrial park about 61/2 miles from Los Banos at Interstate 5 and Highway 165. The proposed site for the 1,585-acre industrial park is on county land.

The venture includes plans to relocate Los Banos Municipal Airport and use those 125 acres to build a new regional hospital. The airport would be moved to a 300-acre piece of land next to the industrial park.

The entire proposal is expected to bring more than 10,000 jobs to Merced County, Carrigan said.

The next step, he said, is a $50,000 infrastructure study to analyze water and sewer capabilities, including an assessment of water supply. With the county’s water shortage from another year of drought on everyone’s minds, Carrigan said a water supply study is crucial.

“We are keenly aware water is essential to the Valley,” Carrigan said. “If the assessment finds that we don’t have enough water, then the project dies.”

The working group, which is composed of landowners, city and county staff, will explore how to fund the $50,000 infrastructure study. Carrigan said he won’t ask the county for money, but hopes the discussion will lead to the property owners helping out or coming up with other avenues for funding.

The county supervisors are also expected to select two board members to participate in the working group.

There’s no fiscal impact to the county other than staff time spent on the group meetings. Mark Hendrickson, Merced County director of community and economic development, said the meetings will likely take place monthly and last less than an hour.

The land proposed for the large industrial park is agricultural, used to farm almonds and pistachios, but some zoning changes might be necessary to advance the project. The county would also require agricultural-land mitigation, which means restoring the same amount of land for similar ag uses in another part of the county.

Carrigan said the property owners of the proposed site have been supportive of the idea thus far. “Across the board, they (the property owners) said, ‘We’re making money. Show us how we can make more money with the industrial park, and we’re on board,’ ” he said.

The supervisors applauded Carrigan’s effort in bringing an “outside-the-box” project forward. If successful, the county could be similar to cities like Tracy and Patterson that have attracted large companies based on having the proper infrastructure.

One supervisor said it will also benefit the county to have a regional hospital in the area. “So many people have to leave this county to get adequate health care for (certain) medical conditions,” District 4 Supervisor Deidre Kelsey said. “It would be nice to have our own place.”

Carrigan said a market analysis is also needed to see if the county can attract businesses to the area. That study can cost up to $150,000, but Carrigan said the risk is worth the reward. The project is expected to generate more than $5 million in annual property and sales tax revenue if it comes together.

This story was originally published February 4, 2015 at 8:53 PM with the headline "Merced supervisors approve group discussions on Los Banos industrial park."