SAN MARCOS, Texas – The San Marcos City Council voted unanimously on Tuesday to approve an Economic Development Incentive Agreement with H-E-B, paving the way for a new grocery store in the city.
The agreement, passed 6-0 with one council member absent, marks the first step in bringing a 100,000-square-foot store to a 17.67-acre site at the southeast corner of Interstate 35 and McCarty Lane. The store will feature fuel pumps and a car wash.
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The addition of this H-E-B location is expected to create 212 full-time and 238 part-time jobs, a significant boost for the local economy.
Mayor Jane Hughson credited the City Council’s proactive steps in May 2024 to encourage grocery store development, which set the stage for discussions with H-E-B that began in August.
Under the agreement, H-E-B will receive a rebate on a percentage of property and sales tax collections over five years, based on a $55.35 million capital investment. The city anticipates retaining $604,000 in property taxes and $1 million in sales tax revenue during that period.
The incentive does not affect the revenue of other taxing entities, allowing Hays County and the San Marcos Consolidated Independent School District to collect an estimated $1.5 million and $2.4 million in taxes, respectively.
In response to the May 2024 resolution that supported grocery store incentives, city staff developed marketing materials for potential grocery companies.
The City Council will vote on the agreement’s final approval on Nov. 6.