FULSHEAR, Texas (Covering Katy News) — Fulshear City Council rejected an economic development incentive agreement with Home Depot on Aug. 4 after the retailer declined the city's request to conduct a traffic impact analysis for its planned store near FM 1093 and FM 1463.
Council voted 5-2 to deny the proposed Chapter 380 agreement. Council-members Abhi Utturkar and Richard Russell voted against the motion to deny it.
The decision does not prevent Home Depot from moving forward with the approximately 134,000-square-foot store. Existing development agreements governing the property do not require the company to conduct a traffic impact analysis.
The proposed agreement would have returned 25% of Fulshear's 1% local sales tax generated by the store for up to five years. Although payments were capped at $2 million, city staff estimated the actual incentive would have been closer to $500,000. Home Depot would have proposed an investment of more than $38 million and at least 40 full-time-equivalent jobs.
Traffic study becomes central issue
The city requested that Home Depot conduct a traffic impact analysis before site-plan approval as part of the incentive agreement, but Home Depot declined because the study is not required under existing development agreements for the property.
Mayor Don McCoy questioned how much additional information a traffic study would provide given the road improvements that have already been made in the area.
"Can you clear that up just a little bit why a TIA is so imperative at this time?" McCoy asked.
Assistant City Manager Kelsee Lee said Home Depot is exempt from the requirement because of previously approved development agreements tied to Cross Creek Ranch.
"If Home Depot chooses to just come without any sort of incentive agreement, they will still not be required to do a TIA," Lee said.
Lee added that the study "was only something that could be negotiated as part of an incentive agreement."
Mayor Pro Tem Sarah Johnson said the absence of a traffic study affected her view of the deal.
"I would have respected the 380 if we had a traffic impact analysis," Johnson said. "I think it is quite a busy area to get busier."
Councilmember Camron K. Miller questioned whether Fulshear needs to provide incentives to large national retailers.
"Giving incentives to big-box stores, I don't think that's where we need to — our focus needs to be," Miller said.
Flewellen Way remains a concern
Councilmember Kimberly Bow questioned why development plans still showed access to Flewellen Way if traffic was intended to be directed toward FM 1463 and FM 1093.
"It very much still has Flewellen Way as an access point," Bow said. "So I think if the true intent is 1463 and 1093 to kind of be the access points there, the traffic impact analysis, I think, might help reinforce that."
Lee said Home Depot intends to seek a variance to eliminate a planned driveway connection on the northern portion of Flewellen Way and does not want trucks using that route.
Fulshear still wants Home Depot
Despite opposing the incentive agreement, Johnson said the city still wants the retailer.
"We do want Home Depot in Fulshear," Johnson said. "You are a great company, and we want you here."
She added, "At the moment, it's just how do we make it work for both of us? And I think, you know, a 380 is probably just not the right way to go."
City staff had recommended approval of the revised agreement.
The rejection ends the proposed incentive but does not prevent Home Depot from pursuing the project under existing development requirements.