Loveland council sweetens pot to attract Bobo’s

LOVELAND —- In what may be a first in Loveland, or in many communities in the region for that matter, an employer seeking incentives to expand came asking for one sum and ended up getting twice as much. And it came with a unanimous vote.

Simply Delicious Inc., doing business as Bobo’s Oat Bars, wowed the Loveland City Council with its plans to consolidate three facilities into one larger one in either Loveland or Johnstown. By the time it was done, even council members who usually vote against incentives voted in favor on Tuesday night.

Bobo’s asked for a waiver of half of the $300,000 in sales taxes that it would pay on $10 million worth of manufacturing equipment that it would buy during its first year of operation in a new, 120,000-square-foot facility. The requested amount in the original proposal anticipated that the company would still pay the remaining half, or $150,000.

Discovered during the night, however, was a disparity between Loveland and Johnstown. Johnstown doesn’t tax manufacturing equipment. Loveland does and may be an outlier among communities in the region.

Council member Dave Clark, after asking what other communities do and hearing that Loveland and Fort Collins are among a very few who apply the sales tax to manufacturing equipment, said “with that in mind, I’d almost suggest we don’t tax at all.”

Other members of the council jumped on board, with multiple members asking Bobo’s if it would consider designating additional savings from a waiver of all tax on equipment to employee benefits or community benefit. 

Bobo’s responded that it would welcome that approach.

Council member Don Overcash suggested that the city trust the company to apply the money appropriately, and because the motion before the council gave the city manager authority to review the agreement, the council decided to move ahead.

The decision may have tipped the scale for Loveland over Johnstown, although Bobo’s said it will make its decision within the next 30 days. The Johnstown Town Board meets Sept. 8; the agenda for that meeting was not available as of Tuesday.

The company, as previously reported, is looking at three facilities — two in Loveland and one in Johnstown in the 2534 development adjacent to Loveland. It will consolidate a Boulder bakery operation, its Loveland bakery and its Loveland warehouse into a single facility that it plans to use for the next seven to 10 years. The agreement calls for a commitment to sign at least a seven-year lease. Facilities under consideration, all new, are the Etkin Johnson Axis 25 development along Interstate 25, a Centerra industrial building under construction, and a United Properties Trade @ 2534 facility, which is also under construction.

Bobo’s said speed to occupancy is a critical factor, and the Loveland facilities would permit that to occur more rapidly. 

The additional incentives were greeted with grins from the Bobo’s representatives. “You guys are tipping the scales favorably toward Loveland,” one said.

Members of the public who spoke were generally favorable although caller Larry Sarner said, “This is exactly the kind of thing you should not be doing.” He said if taxes on industrial equipment are going to be waived, they should be waived for everyone.

Bobo’s will grow its employee base along with its manufacturing space. Its corporate office will remain in Boulder where the company began in 2003. Its manufacturing employees all live outside of Boulder and many now live closer to where the new facility will be located, Bobo’s said.

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