Rock Hill is close to landing a $240M Costco distribution site, report says
A $240 million distribution center in Rock Hill reportedly for Costco would create 165 jobs — if York County can work out an agreement that’s unlike any incentive deal in recent years.
The county has to decide whether to allow $30 million in infrastructure tax credits.
York County Council passed the first of three votes needed for an incentive deal with the company behind the distribution project Monday night. While companies aren’t typically named prior to a final vote, Councilman Watts Huckabee referenced a Charlotte Business Journal article “that mentions the name of the company” — Costco.
York County often agrees to set fees in place of taxes for large employers who move to or expand within the area. The county hasn’t done that for a warehouse and distribution site in more than a decade, York County Council Chairwoman Christi Cox said.
The county typically favors higher-pay industrial projects. The distribution project would have an average hourly wage of $26.66, according to the county.
“This is quite a departure,” Cox said. “The number of trucks is concerning. Thousands of trucks a day, plus a number of vehicles as well. I think this is one of those major developments that would require some initial discussion.”
Costco officials could not immediately be reached for comment Tuesday by The Herald.
The site would be operational by mid-2027, according to York County. A 541,000-square-foot building would go on 173 acres. A future phase could expand it to 898,000-square-feet.
Off-site public infrastructure improvements, which could involve roads and utilities, would cost about $44 million. An infrastructure credit agreement could give $30 million of that amount back to the company, in reimbursed tax revenue.
Meanwhile, the Rock Hill region will get its first Costco warehouse store with the opening of one in Indian Land this month. The distribution facility in Rock Hill would serve about 20 locations in the Carolinas and a little of Georgia.
York County, Rock Hill, school district money
Incentive deals often involve credits back to a company, through taxing bodies agreeing to give up a portion of what the company would typically pay. Deals often reduce or lock in a tax millage rate, and reduce the tax assessment rate for decades.
Those measures help South Carolina compete for companies with lower business tax rates, like North Carolina.
“If you want an employer to come in, you almost have to compete somewhat,” Huckabee said. “Especially if you’re in competition with North Carolina.”
York County, Rock Hill and the Rock Hill School District all operate off of tax revenue, but York County is the entity that finalizes the incentive deals.
Councilman William “Bump” Roddey reached out to school board members Monday to ask if they knew about the agreement that would include $18.6 million in credit from the district’s share of tax revenue. None of them did, Roddey said.
“I think it’s only right that they’re given an opportunity to let us know where they stand on what their portion is or would be, by this give,” he said.
Council members agreed to let school officials in on the closed-door discussion about the project, even though that hasn’t happened with other large projects.
Huckabee isn’t sure why this project warrants a policy change. “It’s a big number,” he said of the total investment, “but it’s not the biggest number that York County Council has had to deal with. And it won’t be the largest.”
Multiple council members brought up the failed Carolina Panthers headquarters project in Rock Hill, where nearly two years of negotiations laid out dollar figures for the county, city and school district. With a new type of incentive deal for the distribution project, several council members want the involved parties to understand what is happening.
“We have never given an infrastructure credit like this before. Ever,” Cox said. “Which is why I think it makes sense to have the schools involved in this.”
The school district portion of the credit comes to about $951,000 annually, said county Economic Development Director Mitch Miller. He agreed to sit down with the district to lay out plans next week in a school board executive session, as did company representatives.
Some Council members want to go further with incentive deal discussions.
While Cox said some details can be shared in advance, company names are protected until a deal is finalized. Non-council members shared the name for this project, Cox said. Some members questioned why names have to be kept secret.
“This is a major, major project,” said Councilman Andy Litten. “We’ve all talked about it. But as it’s come up over with the QTS project just recently, nobody knows who these things are.”
QTS is a data center in Lake Wylie. Council agreed to incentives for the $1 billion project two years ago, despite little public information on the company prior to the deal being finalized.
“We want the public to weigh in on it,” Litten said. “And if the public doesn’t know what they’re weighing in on, then they can’t weigh in.”
With two votes needed to finalize the distribution center deal, the earliest it could be completed is Nov. 17.
