The Galt City Council recently voted to enter into an exclusive negotiation with Upland-based development firm Lewis Acquisition Company, LLC, in an effort to revamp the Galt Market and surrounding city-owned property.

During the July 16 council meeting, the council voted in favor of exploring new opportunities to monetize the property that would create a consistent revenue stream for the city’s parks and recreation department.

The vote ended in a 3-2 decision with Mayor Paige Lampson and Councilmen Curt Campion and Rich Lozano voting in favor of entering into negotiations with Lewis Acquisition to create a Galt Market master plan. Councilmen Shawn Farmer and Paul Sandhu voted against it.

The council was given a presentation by Economic Development Manager Amie Mendes, who stated the market is not generating a strong stream of revenue for the city due to the growing shift in online purchasing.

“As we know the market has historically provided the largest source of revenue for parks and recreation, however over the past few years we have seen a shift in retail consumer behavior that has resulted in a significant decline in revenue generated by the market,” Mendes said.

Market revenue has been declining since the mid-2000s. According to former City Manger Eugene Palazzo, market revenue hit a peak in the 2004-05 fiscal year at $3.5 million.

“Presently, today the Galt Market provides us with a little over $2.5 million in income in support of our parks and recreation programs,” Interim City Manager Tom Haglund said. “The net amount we provide to the parks department is between $1.5 to $1.6 million. We have to take out market operations of course — but that amount is very significant to this community.”

According to Mendes, the market property is currently underutilized because the market is only open Tuesdays and Wednesdays and vendor space has dwindled over the years.

The market, which was once a hub for wholesalers looking to move their inventory, has become a series of vacant spaces due to online retail sites that have shifted the trend in shopping behavior.

The trend is not unique to Galt’s market, as many national large-scale retailers have struggled to keep stores open as consumers continue to purchase online.

While cities like Galt that rely on the market for parks revenue are feeling the strain in a shifting market, the city sees mixed-use development as a method of securing the parks department’s financial footing.

Lewis Acquisition, which is expected to serve as the developer for the project, is working with city staff to amend California Assembly Bill 3773, which states “the City of Galt may conduct a city-operated flea market on the property, upon condition that the rents from these uses shall be utilized by the city solely for park and recreation purposes in the city.” The word solely was amended in 1982 to replace the word substantially, which was initially written in the bill.

“The Lewis group will deposit $5,000 into an escrow account for the initial feasibility of AB 3773 to determine what the deed restriction options are on the property,” Mendes said.

Mendes stated that if the outcome of amending the deed restrictions were favorable the city would be able to develop a master plan for the market property.

While the council members agreed the city needed to find a more secure source of funding, Farmer disagreed with pursuing an agreement with Lewis Acquisition.

“You are not coming in as a consultant, you are coming to purchase this property from the city of Galt,” Farmer said to Lewis Acquisition representative Jeb Elmore during the July 16 meeting.

Although Farmer was unsuccessful in his attempt to dissuade his fellow council members from voting in favor of entering into negotiations with Lewis Acquisition, the company will need to pursue legislative action to amend the AB3773.

If the company is successful in changing the language of the bill, the city of Galt is expected to move forward with Lewis Acquisition to create a mixed-use development master plan.

Mendes said both the city and developer will seek input from the public to create a project that fits the needs of the community.

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