TO: Urban Renewal Agency Board
THROUGH: Krishna Namburi, Executive Director
FROM: Kristin Retherford, Community Planning and Development Director
SUBJECT:
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Grant exceptions to the Riverfront Downtown Urban Renewal Area capital improvement grant for grocery and food services at 435 Liberty Street NE.
Ward(s): Ward 1
Member(s): Tigan
Neighborhood(s): CANDO
Result Area(s): Strong and Diverse Economy; Welcoming and Livable Community.
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SUMMARY:
summary
Urban Renewal Agency Board action is needed to allow an exception to the mandatory requirements and approve an exception to the maximum grant amount of $300,000 and approve a total grant award of $470,000. The Riverfront Downtown Urban Renewal Area capital improvement grant program guidelines permit the Director to approve grant requests up to $300,000. Grant funds will be used to help fund the costs to improve the existing building and install equipment for grocery and commercial kitchen food services.
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ISSUE:
Shall the Urban Renewal Agency approve an exception to the mandatory requirements and an exception to the maximum grant amount from the Riverfront Downtown Urban Renewal Area capital improvement grant program for a total grant award of $470,000 for building improvements and equipment for grocery and food services?
RECOMMENDATION:
recommendation
Approve an exception to the mandatory requirements and an exception to the maximum grant amount from the Riverfront Downtown Urban Renewal Agency capital improvement grant program for a total grant award of $470,000 for building improvements and equipment for grocery and food services.
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FACTS AND FINDINGS:
The proposed El Torito Supermarket (Applicant: El Torito Supermarket LLC, Liliana Perez, principal, Property Owner: ACV CFT Salem, LLC, Kelly Allred, principal) will improve the vacant building located downtown at 435 Liberty Street NE and provide new products and services for residents and visitors. The applicant owners have built a successful regional chain with multiple locations in Oregon, including two existing stores in Salem. Their commitment to quality and community service have resulted in a loyal following as they look to revitalize this highly visible part of downtown.
On February 27, 2026, the Director approved a $300,000 grant to allow El Torito to begin construction while awaiting final contractor estimates for project completion. With those final costs now received, an additional $170,000 in capital improvement grant funding is requested.
The Agency approves exception criteria to determine eligibility for grant requests greater than $300,000. The El Torito Supermarket will need an exception to criterion 1), since the project only meets one of the two minimum objectives, item 1) e. expansion, retention, or recruitment of a new business that results in creating new jobs.
Capital improvement grant program exception guidelines:
Mandatory requirements
1) Project must meet a minimum of two capital improvement grant program objectives:
a. New construction
b. Mixed-use, including housing
c. Alley improvements
d. Historic preservation projects that require Historic Landmarks Review
e. Expansion of existing business, retention or recruitment of new business that results in creating new jobs
f. Upper floor renovations, improvements that make currently unleasable space to a level it can be occupied
2) 4:1 leverage of private/public funds; and
3) Project must meet one of the following ‘other’ criteria
a. Third party grant pay back analysis of increased tax increment that reflects payback of grant over a 7-10-year period or sooner, or
b. Project is characterized as blight as follows; 1) raw land or building that has been vacant for more than 5 years; or building has been designated as a derelict building by the City of Salem, or
c. Housing, or
d. Adaptive reuse of an existing building where grant eligible projects costs exceed $3 million
The project satisfies 1) e. where the new business anticipates adding 30 new jobs over time. Item 2) ratio of 4:1 is met because the eligible project costs are over $2 million, and the final requirement, 3) b. is met by alleviating a blighted building.
BACKGROUND:
El Torito Supermarket will be in the former Rite Aid building at 435 Liberty Street. This building has been vacant and problematic for years. All grants are conditioned upon qualified contractors and meeting all city zoning and permitting requirements. If the exceptions are approved, they will be required to provide contractor transparency information.
Construction progress will be shared with council in quarterly economic development reports, as applicable.
Tory Banford
Project Manager
Attachments:
1. None