State and local officials announced Wednesday that Dollar General will build a 1 million-square-foot distribution center in Janesville that by 2019 would employ 552 people.
While the jobs will pay less — $15 an hour — than what had been offered at the now-idle General Motors Assembly plant, the news, coupled with an aggressive building schedule, was welcomed by economic development leaders in Rock County and at the state level who say the project will have an impact not only within the city but the region.
“Dollar General will put the equivalent of nearly 1 percent of Janesville’s population to work,” said Mark Freitag, Janesville’s city manager. “While many businesses have recently chosen to call Janesville home, the scale of the Dollar General project will give a strong boost to the growth of our local economy. This is a great example of collaboration between the private sector and state, county and city government.”
The Janesville City Council on Monday will consider two tax increment financing development agreements and a Transportation Economic Assistance grant application for the facility, which would be built on 124 acres in the city’s Highway 11 Business Park at Innovation Drive and Beloit Avenue.
The packages, valued at $11.5 million, include $4.2 million in land costs, $3.9 million paid out over 10 years based on a guaranteed value of $40 million to the building and $1.3 million paid out over 10 years providing Dollar General creates $25 million in personal property value in the facility, said Gale Price, director of the city’s economic development office.
“An employer like this with this level of pay really helps right the ship for people who are under employed or holding two jobs,” Price said. “This is the kind of wage that people will be willing to move to the community for, and that’s a big deal from an economic development standpoint.”
Dollar General intends to break ground on the $75 million facility in October with occupancy by the end of 2016. The center is scheduled to be fully operational by July 2017 and by 2019 support up to 552 full-time jobs. The facility will support Dollar General’s retail sales distribution network in the Midwest and include an onsite truck maintenance facility and dispatch center.
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Dollar General operates 12,198 stores in 43 states, including 122 stores in Wisconsin that employ more than 900 people, according to the company.
Todd Vasos, chief executive officer of Dollar General, said his company considered two other Midwest locations, but the Janesville site offered a quick construction turnaround and is near major transportation lines like Interstate 39-90, and highways 11, 26 and 51.
“Janesville offers an ideal location to service the growing needs of our business in the Upper Midwest,” Vasos said in a statement. “Janesville provides a great location, a strong business environment and a great workforce to draw from to fill the 552 jobs that are anticipated to be created by this new distribution center.”
The Wisconsin Economic Development Corp. is providing $5.5 million of potential tax credits to the company through 2019. The contract with WEDC requires Dollar General to create 552 new positions with an average starting wage of $15.57 per hour and make a capital investment of $75 million in the Janesville facility, according to details released by the WEDC.
The project is a partnership between Dollar General, Alliant Energy/Wisconsin Power and Light, the Janesville Economic Development Office, the Rock County Development Alliance, WEDC and the state Department of Transportation.
“This project provides a visible example of how strategic alignment, collaboration and positioning generate positive outcomes,” said James Otterstein, economic development manager with the Rock County Development Alliance.
Dollar General is the second Fortune 200 company to locate a distribution center in Wisconsin in the past two years. In 2013, negotiations with WEDC led Amazon to build a $250 million, 1 million-square-foot distribution center in Kenosha that has the potential to create 1,100 jobs.
It also marks the second major jobs announcement for Janesville this summer. In July, A.M. Castle, a global distributor of specialty metal and plastic products, announced that it would consolidate its plants in Chicago and Minneapolis into a 208,000-square-foot facility that is being built at 3800 Enterprise Drive in Janesville. The move is expected to bring 90 jobs to the city.