---

To make it even more interesting, the guy who suggested it is none other than downtown merchant and new council member, Bob Link, who fought hard against what was termed “leap frog development” at Plaza and 198 when Fresno developer Ed Kashian proposed a big retail/entertainment complex last summer.

But that’s the spot the council is ready to take a fresh look at and a location that may be car dealers top choice.  Assistant city manager Dianne Guzman says staff has been instructed to look at the idea and alternate sites including Plaza 198 and return “quickly” with recommendations.  The matter is expected to come to the Planning Commission within the next few months, she says.

Link says he is motivated by the need to relocate Razzari Ford out of the downtown area to make room for other more compatible development including a possible public square - a proposal that was echoed at the recent Downtown Visalians meetings.

“Yes, we’d like to move out of downtown,” says general manager for Razzari Ford, Bob Anderson.  “The city suggested the idea of a new auto mall some months ago but we haven’t heard anymore,” he says.

Link says the bottom line is there isn’t any place east of downtown - where the city sited a multi dealer auto mall - to accommodate more dealers and car lines that may want to come to town.

There is some land left at the auto mall on Ben Maddox at Main, but not prime pieces or for that matter, freeway visible land.  “That’s what dealers want,” says Link.  “The successful auto malls are on the freeway,” he believes.

The new look could delay Giant Automotive’s relocation to Ben Maddox where they have purchased the old Budweiser building last year and have drawn up plans for a new showroom.  That plan has been delayed for months and no dirt has moved at the site.  Jack Petty told the Voice they would break ground once an access issue was solved with the city.

Next door Saturn (GM) has purchased land also south of 198 on Ben Maddox for a new dealership.  But, it too has not broken ground.  Guzman says she understands that a possible change in city policy and the siting of a new auto mall could impact those two dealership’s plans.

But as part of a study of alternative sites, Guzman says she will make sure that the discussion of pluses and minuses are set out.  “Plaza Drive is going to have an awful lot of truck traffic in the future,” says Guzman, and may not be the right place for retail, busy car dealerships or a family fun park.  The council will be looking into alternative sites for a fun park as well, says Guzman, as a result of council urging.  Guzman says the city ought to look at expanding the auto uses east of Downtown along with freeway sites.

Link says the difference between what Kashian wanted to do out on 198 at Plaza “would have hurt Mooney and hurt Downtown” since it would have robbed Costco off Mooney and built a new movie theater “right after we completed the new downtown 10 plex.”  On the other hand he says there is a need “to create a new area for car dealers.”

Car dealer Don Groppetti says “I’m extremely disappointed the city would consider that idea since there was so much invested in this side of town.”  He says that “I don’t see any benefits from being on Highway 99.  It’s not like there is lots of commuter traffic like in some metro areas.”  Groppetti says there are “no car makers looking to come to Visalia right now.  Neither Lexus, Mercedes or Infiniti are expanding now,” he says.  “All car makers are reducing their dealer count” so the idea that lots of new lines would come to town is wrong.  Rather Groppetti says “there are multiple synergies from keeping car dealers together on this side of town.

“Go out and find 10 to 15 acres like across the street from where Giant wants to go,” he says. Groppetti says when his dealership was out on Shirk and 198 “all we heard from customers was how inconvenient it was to service their cars.”  Groppetti has a multi million investment in the auto mall on Ben Maddox along with the leasing of the old Putnam Windh facility.  “We can’t leave there unless the city want to buy us out,” he notes.

A decade ago the debate suggested that anchoring downtown’s east end with car dealers would benefit the infill of east Visalia with new investment and relocate some of the dealers out of the heart of downtown.  East Visalia has a huge number of old small businesses devoted to car repair and accessory sales that appear to work well in a city auto district.

Razzari for one was a player ( he rents his current location) - a potential buyer for a spot at the city owned auto mall but the deal fell through.  That spot is now taken by Don Groppetti’s Nissan dealership.  Razzari’s Merced dealership is right on the freeway.

The auto mall now has Nissan, Toyota, and the Frank Serpa lines including Hyundai and VW and Kia.  Putting a new auto mall elsewhere could potentially hurt this investment.  But others may argue that the redevelopment experiment in this small auto mall has not penciled.

---

Visalia - Consolidation in the insurance industry has meant both good news and bad news for Visalia’s employment base over the past decade.  As a lower cost location within California to do business, Visalia has gained a reputation as a logical relocation option for claims and call center operations in insurance circles.  That seemed to be the promise when Nationwide Insurance and Wausau Insurance discovered Visalia in the early 1990s.  Snagging Nationwide/Wausau was considered a coup by Visalia back then when city manager Don Duckworth went to company headquarters in Columbus, Ohio to make a deal.

But this week Wausau Insurance announced it will close its Visalia claims office next month according to a company spokesman, ending what had been a dream of west coast regional headquarters for Wausau and then sister company Nationwide Insurance.  The two built an impressive 150,000 sq ft office complex here in the early 1990s on south Mooney Blvd where as may as 800 were employed during one stretch.

The classy address was toasted as the town’s largest office building.  The busy Visalia office processed more than 51,000 claims each year out of their west coast regional office here.  At one point Bay Area and LA area Nationwide offices and Wausau offices were relocating employees here - a boon to the local real estate economy.
With the closing of the Wausau office the name on the building - now owned by the County of Tulare - will finally come off this spring replaced now the a Government Plaza sign.

Nationwide Insurance closed their Visalia operation last fall, says a company spokesman, transferring the work to Portland Oregon.

In a few weeks a sub-renter for Nationwide - Key Health - will close out their office here having gone out of business themselves as of January 1.  Wausau Insurance had been majority owner of Key Health at one point.  Vacating 35,000 sq ft at the County owned building will leave the Resource Department at the County able to relocate some employee groups in themselves, says Resources head Jim Larsen.  “We still have some groups scattered around the County we can bring in,” he says.
The demise of some insurance companies here is in vivid contrast with second insurance company whose star is rising, at least locally.  Cigna made a deal with the city of Visalia last year to buy 11 acres of land at Tulare and Akers where they are building a new 150,000 sq ft office complex of their own.  Even though construction of this flashy multi story building is well under way - this week the insurance company - through their architect - asked for city approval to add another 29,000 sq ft mailroom on the side of the new building and is expected to purchase another 3.3 acres they have had a five year option on.   “It will mean more jobs,” says assistant city manager Dianne Guzman.

Already at 1000 employees at their current office on Chinowth and 198, Cigna is expected to add 200 more by 2001.  The new office should open this summer on Akers.  Among others the expansion of Cigna here is expected to mean the consolidation of other Cigna offices including Fresno into the Visalia center.

The fortunes of the two big insurance companies in Visalia is clear from the 1994 profile Discover Visalia - a city of Visalia survey that found both Cigna and Wausau as the town’s two largest private employers both with some 500 employees.  Today Cigna has doubled that number and Wausau will soon have no employees here.
Regarding Wausau - the company was purchased by Boston based Liberty Mutual Group last year and in August they announced a “realignment” that would eliminate some 1500 positions by the end of the first quarter of 2000.  Brad Zweck, a spokesman for Wausau/Liberty Mutual says the Visalia office - now down to 17 employees would close by March 31.  He said 6 employees so far have accepted positions with the company in other locations outside California.  Liberty is one of the largest multi line insurance companies in the nation.  The Visalia Wausau office was a liability claims office most recently.  When Liberty Mutual bought Wausau the latter company had some 5300 employees.

Nationwide Insurance, once the major player in Visalia, has been downsizing here for the past 4 years citing the difficulty of making money in California.  This past year, however, they purchased California based Cal Farm Insurance but manage the company out of Sacramento.

---

Tulare - Dairyman’s Land O Lakes and US Cold Storage are counting on regulatory approvals in the next few weeks that will give them the green light on two new multi million investments in Tulare.

This week the Tulare County Board of Supervisors met in closed session because of potential litigation regarding a plan by the city of Tulare to expand its redevelopment boundaries.

The expansion will enable Tulare properties in the expanded district to be eligible for assistance from the redevelopment agency and infrastructure needed to be added in the area to be paid for.  The Board of Supervisors are interested in the issue because they stand to lose tax monies short term since the new tax base will go to the redevelopment agency in the new district.

 Despite that fact, all indications are “things are pretty cordial” according to one top staffer.  The County knows that plenty of jobs depend on their decision that essentially gives the companies a tax break to expand.

The city needs the County’s blessing to proceed with the March 13 joint planning commission/city council hearing on the redevelopment plan that would expand both the K St. zone boundary and the downtown redevelopment zone.  “The County asked us to amend some language in the plan,” says city manager Kevin Northcraft.  No word if the County asked the city to cut them in for a piece of the redevelopment pie.

Once the March 13 hearing is over both Dairyman’s Land O Lakes and US Cold Storage will be able to announce two very big deals in Tulare - only a block from one another they have each been busy working on.  Both projects are in the design stage.
LOL/Dairyman’s has been working on a new $145 million cheeseplant at their former Kraft (CPC) cold storage plant on Paige that they own.  They are remodeling the facility to accommodate cheese manufacturing.  Also they have an additional 18 acres adjacent that plant.  LOL plans not only a 300,000 sq ft cheeseplant, but an 80,000 sq ft whey manufacturing plant featuring a 120 ft drier connected by pipes to the main cheeseplant.  The plant will be a joint venture with Mitsui.  That whey plant will be located on the 18 acres LOL bought from Southern California Edison a few years ago.

Land O Lakes has announced the facility but haven’t announced its location to assure they could fully participate in the redevelopment project area.  The zone expands onto the block where the two properties are.

In addition, US Cold Storage would gain a second company owned plant in town with construction of a new facility north of Levin on 19 acres the company has in escrow now.  The new building would be some 60,000 sq. ft.

Confirming that the property is in escrow to be purchased from Kraft/General Foods - regional manager Rod Noll of US Cold Storage said the company is still studying the layout of the property.  In addition Noll confirmed the company will help pay for bringing rail access across Levin onto the big General Foods property - a line that could run clear to Bardsley on the large vacant parcel west of Blackstone.  Bringing rail access could help land another major company, says former Tulare city manager Lynn Dredge who has been helping with the US Cold Storage deal.  Currently rail is only on the south side of Levin.  This large parcel was also added to the K St. redevelopment zone in the latest expansion plan.

US Cold Storage already has a plant on Paige and they currently lease the former Kraft plant on Paige because they ran out of room at their other 210,000 sq ft facility - that was built in 4 phases.  “We need a place to store more product,” says Noll.
In addition to these deals, a major new truck hub operated by Indian River Transportation will be located at the corner of Levin and Blackstone.

Besides this deal the city hopes to entice Morningstar Farms to expand their north J St. plant - perhaps by moving a water basin with redevelopment monies, says Kevin Northcraft.

---

Visalia - News that Visalia had come to an agreement with the nation’s largest fabric retailer, Jo-Ann Stores, for their west coast distribution hub is welcome indeed.  The Ohio based company announced it will build a 630,000 sq. ft. warehouse on Plaza Dr. just north of Sequoia Beverage this year and hire 120 by start up - 300 locals by their fourth year of operations.

Construction of the $37 million project is expected to begin this fall on 57 acres with a future phase 2 of the project bringing the square footage to 1 million.  If only the first phase happens it will still be Visalia’s largest building.

Visalia officials say they had worked with Jo-Ann Stores for almost a year.  The site has been narrowed after a study by the company’s consultant, Deloitte Touche Tohmatsu International.  “Our computer models showed the central valley was where we wanted to be,” says Tom Biltz, Director of Logistics, Planning and Engineering for Jo-Ann.  “We’re making a major push with the new large format stores in the West,” he says “and this distribution center is key to that plan.”

“We are very excited about this new development and the jobs it will create,” said Steve Salomon, city manager for the City of Visalia.  “Economic development is a primary mission for the City Council and our staff and our hard work has paid off.”
The landing of a major employer is welcome after Visalia came in second place in the bidding for Leprino Foods in December when the big dairy processor decided to locate in Lemoore.  “This time we’re not just best man at the wedding,” says broker Mike Porte who handled the sale of the land owned by the Hayes family for the seller.  “This piece of land has been on the market for over 10 years - since I started working as a real estate agent,” says Porte noting that industrial inquiries remain strong in the new year.

While demand is strong for industrial land in Visalia, Porte notes the Hayes family and others have had to come down on their asking price to move it.  Originally, when he began marketing the Hayes family property - two large sections of land on both sides of Plaza - it was at $35,000 an acre.  Now the listing price is down to $25,000 an acre and this property was sold for less than that.

Visalians may be interested in the fact that the lead on this big development came through the State Dept. of Commerce through the Tulare County Economic Development Corporation and then out to the cities.  Dinuba and Visalia were among the Tulare County competitors for the big distribution center with Visalia winning out over offers of free land at two out of county locations, according to multiple sources.  Visalia officials had complained over the years that the EDC leads never seemed to land in Visalia.  Visalia also won out over Fresno.

“It makes sense for leads to come through the state,” says Karen Ford of the EDC, since the company was considering Reno as well as sites in California.  “That way you work with one agency who will give each town the leads,” she says.  Regarding the lack of a president to head up the agency Ford says “we’re doing the best we can but we look forward to someone coming on board.”  The EDC has remade itself with a 17 member board - 9 private members and is considering how to move forward on this issue.

According to Salomon, Jo-Ann Stores executives “seemed to appreciate our small town atmosphere and the fact that we welcomed and embraced them.  They also appreciated our technical skills, our depth and our ability to move quickly.”
The availability of a labor force was another critical selling point according to the city.  “The workforce is outstanding,” says Tom Biltz.  “The Private Industry Council will be our point man recruiting and hiring,” he says.

The company has an aggressive time table that calls for construction to begin this summer - beginning by September, construction completed by December and shipping by this time next year.  Biltz says Jo-Ann will select a contractor to do the construction project in the next few months.  Locals may have a shot at getting the bid, he says.

Biltz says the Visalia distribution center will service some 300 stores west of the Mississippi with 128 of them in California.  “We appreciate a location close to the highway,” he says.

The company’s Chief Financial Officer, Brian Carney, says the new format super-stores - 45,000 sq ft - sell on the average 40% more per square foot than it does in smaller Jo-Ann stores like we have in Visalia.  The new store name - ETC - are just beginning to open in the West.  The first one just opened in Torrance.  Nationwide there are 42 such stores.  The new stores have more than yards of fabric - they also sell custom furniture, framed art, crafting goods and home decor items, he says.

The company is betting the farm on expanding into the super-store model with as many as 300 such stores in major metros in the next 4 years.  While the fabric business has consolidated nationally - Jo-Ann itself bought House of Fabrics recently - there are few national players who are working this niche - one reason the company is moving on the new format stores.  Only Michael’s - which has a store on Mooney - has some of the same goods.  Currently, however, the company’s stock is in the doldrums having declined from $30 two years ago to $9 today.

The landing of Jo-Ann Stores for Visalia will impact our industrial park as well.  The city agreed as part of a “performance agreement” to put in a stop light at Ferguson and Plaza and extend Ferguson back to the Kelsey alignment.  In addition the city has an option to purchase right of way on the eastern part of the Jo-Ann property to expand rail service on the north clear to Riggin as part of the deal.  That would enable a future rail user to take advantage of the putting in the rails, says Bob Nance with the City Planning Department.

Putting in Ferguson and other infrastructure will benefit the entire industrial park as well,” says mayor Don Landers.  The city looks to extend Kelsey to Riggin and connect Sunnyview to Kelsey in the near future helping to drive development in this part of the industrial park.

The city offered the following incentives to attract the big company here:
1. abConstruct a traffic signal at the intersection of Plaza and Ferguson estimated at $150,000 plus related intersection improvements required to effectively control traffic turn movements (Fund 1111 - Gas Tax).

2. abPay for over sizing of street sections in Ferguson (12 feet over length of Phase I & II).

3. abCommitment of $250,000 in fee waiver or Ferguson Avenue construction Costs (CDBG Job Creation Funds).

4. abPay $100.00 for 3-year option to purchase an easement for $50,000 to extend the railroad spur to the north along the west side of the Kelsey alignment.

Jo-Ann officials commend the Allen Groups Harvey May for their help in the deal.  The Allen Group has an option to buy land on the Hays property on both sides of Plaza, but has also agreed to get out of the way if any end user like Jo-Ann wanted to buy the land.  The Allen Group is building industrial subdivision and buildings extending infrastructure to the east of Plaza and may help more of that land nearby to develop sooner rather than later.

Ground breaking for the new Jo-Ann building is expected in early April.

---

Tulare County - Other industries must innovate to survive - to remake themselves and to experiment with new products.  How about the Central Valley citrus industry?

If the dairy processor only made whole milk like ten years ago and the wine industry pushed only a few varieties onto the grocery shelf they would have been eaten up by foreign competition.  Take a look at the bread aisle at your local supermarket and look at the tremendous selection and types of product offered by bakers today.
Tulare County citrus growers may have missed the boat on planting what the consumer is demanding, say citrus researchers pointing to the world wide demand for easy-peeling seedless citrus varieties like Clementine Mandarins.  “We’re 15 years behind” other growing areas like Spain, says Ted Batkin head of the Citrus Research Board based in Visalia.  But, says Batkin, “growers are working to catch up.”  Locally there is a mandarin task force and trials are underway on varieties of EZ peel mandarins at Lindcove Field Station east of Exeter.

The big question is what varieties of mandarin - a cross between and orange and tangerine.  “We know we can harvest varieties of mandarins from late October through April,” says Batkin.  The central valley mandarin varieties that are planted today amount to no more than 3000 acres.  But Batkin says there’s plenty of interest on planting new trees here - expanding the total citrus acreage overall.  “I’m looking at a 10,000 acre crop within 4 years,” he predicts.

Many varieties can be harvested with a good crop in as little as three years, he says.  Right now there is some 116,000 acres of citrus planted in Tulare County - three quarters are navels and only a fraction is tangerines.

Besides selecting the variety, growers have to change their approach when planting Clementine mandarins - what Batkin calls “the hottest product in the citrus industry right now.”  He says growers must adapt to mandarin production - “the fruit is far more delicate, more labor intensive - more like stone fruit,” he says.

A South African researcher, Dr. Etienne Rabe, suggests than until recently there was no evaluation of mandarin varieties in California and that the fruit, since it is smaller and requires more handling, “will require much more manpower per pound of fruit produced.”  “But that could pay off with a more lucrative product,” says Rabe in a recent issue of Subtropical Fruit News.

Batkin says mandarin trees are cold tolerant but the fruit may be less tolerant than navel oranges - the mainstay of the industry here.  With a thinner skin it is more susceptible to frost.  Batkin says he sees new plantings of mandarins in southern Tulare and Kern counties in coming years.  He says right now we are losing our markets to Spain and other countries who are shipping into the eastern US with product.

---

The above stories are the property of The Valley Voice Newspaper and may not be reprinted without explicit permission in writing from the publisher. 

February 16, 2000