Johnstown targets eating, drinking businesses with sales-tax rebates, grants

JOHNSTOWN — Soon, Johnstown’s retail giant Ledge Rock Center will burst with activity in its 1 million square feet of commercial space off Interstate 25 and Colorado Highway 60.

While this “power center” will most certainly attract the business, Johnstown leaders have a plan to ensure that the town’s smaller retail areas don’t suffer in the wake of the town’s more-successful high-volume retail centers.

The plan is to get an incentive program off the ground in January, said Sarah Crosthwaite, economic development manager for the town.

“We often get tons of calls from small businesses that are doing really well in other communities and are looking to open a second location,” Crosthwaite said. “Their business model is being in a downtown area, and we have a low vacancy in downtown, so we have nowhere to put them. This program will help us attract and secure deals for (those other areas).”

The Johnstown Town Council recently approved the Targeted Retail Activation Program, which is a two-fer. It includes a grant program for food and beverage establishments to remodel older buildings downtown along Parish Avenue or the Gateway Center Industrial Park on the northwest side of I-25 and Colo. 60; and it will offer sales-tax rebates to food and beverage establishments for anywhere from one to 10 years, depending on what type of business the program attracts, to locate in either downtown, North Downtown, which is still undeveloped, or Gateway Center. Gateway has traditionally been more industrial, but in recent months has attracted Legends A Meadery, which could be the start of a brewing cluster.

“We’re already noticing a cluster of food establishments, with the Meadery opening this year,” Crosthwaite said. “We know the real estate is limited, so it’s more like flex warehouse. That’s why it’s great opportunity to deploy in those areas.”

Johnstown is no stranger to retail success. Johnstown Plaza is a prime example off Interstate 25 and U.S. Highway 34. Johnstown city leaders years ago developed one of the quickest approval times for major retail projects in the area, which kickstarted many retail and residential projects. After Scheel’s located there, growth mushroomed in that corridor.

In 2022, the town also developed a sales-tax incentive program to attract business to Ledge Rock Center.

“We know retail does really good along the I-25 corridor, Highway 60, Highway 34, Highway 402, we know retail projects will be successful there, and rely on heavy traffic, we work with those developers,” Crosthwaite said. “We wanted to go into specific corridors in the community where we know there’s opportunity to bring in, where the market isn’t as attractive, or there’s impediments to develop.”

Now that growth is really driving itself in these high-volume areas, Johnstown wants to ensure that the less-visible growth corridors receive some love.

Crosthwaite said Johnstown has extensively polled its residents about their wants and needs for their growing borders.

“The biggest thing we get is we want more food and beverage, something to do on the weekends,” Crosthwaite said. “This program is borne out of us listening to our residents with all the outreach projects and understanding this is a need and looking at these specific corridors. There’s a sales leakage happening in that industry.”

For any new restaurant, bar, speakeasy, distillery or brewery, or dining hall, or even movie theater that comes to Johnstown, the town can offer anywhere from a 0.5% to 1.5% sales tax rebate from anywhere from one to 10 years based on the type of development.

For those who want to refurbish an older town building into a hip, modern restaurant space, the city will grant anywhere from $20 to $50 a square foot up to $40,000 in aid to cover those sometimes-exorbitant costs, such as bringing older buildings up to code.

“I don’t know of many communities that will incentivize business to come in and update interiors of buildings, it is all façade,” Crosthwaite said.

“We want to make sure the program proves to be useful and something our businesses take advantage of,” Crosthwaite said. “If we get one, that’s a success, and we get five applicants, even more. We want to deploy any available resources we have to help attract businesses to the community.”

Crosthwaite said the programs are based off programs she found in Jacksonville, Florida. She said she had several discussions with the downtown group there, where they have several incentive tools at their disposal.

“Economic development is about finding what works and making it work for your community,” Crosthwaite said.

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