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U.S. Foodservice Gets Final Approval for Buda Facility

TEXAS (August 18, 2010)—Construction could start within a month on U.S. Foodservice’s regional distribution facility in Buda, following the city and county’s approval on Tuesday of an interlocal agreement with the state agriculture department’s Texas Capital Fund.

The Hays County Commissioners Court and the Buda City Council both approved the contract which U.S. Foods Austin division president John Fowler called “the last hurdle” before the company can close on its purchase of 45 acres on the southeast corner of Turnersville Road in the Sunfield Municipal Utility District.

The county is receiving $750,000 from the state fund to apply toward infrastructure improvements in the area of the facility. Under terms of the agreement, the construction work will create 38 fulltime jobs of which 20 must be held by low or moderate income people.

Once completed, the 290,000 square foot facility is expected to support 405 jobs of which the average, weighted salary is $58,442 not including benefits. The company is investing at least $69 million in the property, Fowler has said, and could expand the facility by as much as 200,000 square feet in coming years.

Earlier this month, the county agreed to spend $2,689,160 for the reconstruction of its roads and drainage facilities to serve the U.S. Foods plant. U.S. Foods will repay the county for the work at four percent interest over 20 years.

That meeting of the commissioners was a small scale rerun of the ongoing U.S. Foods saga. After the city council declined to call a referendum on a land use amendment, former Buda Mayor Jim Hollis and real estate agent Chistopher Juusola filed a lawsuit they eventually lost in the state’s Third Court of Appeals. In June, the Texas Supreme Court declined to hear the case.

“It’s been a long journey and the citizens were essentially denied the right to protect and defend their comprehensive plan,” said Carl Urban, whose family owns property in the area and led opposition to U.S. Foods in that location.

Said Pct. 2 Commissioner Jeff Barton, “The Urbans have been great citizens of Buda. They are among the largest landowners in Buda and in Hays County … so they have their own interests, their own ideas of how this ought to develop. But at the end of the day, it’s not the job of the county to tell U.S. Foods or the city of Buda which corner their facility should be located on.”

The county had intended to structure its arrangement through a tax increment refinancing agreement through which the additional property tax generated by the value of U.S. Food’s investment would repay the cost of the road work. Its attorneys later determined that counties can’t use that mechanism under state economic development law.

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