Oak Ridge North approved its first sales tax preservation agreement with a business in the city’s B-2 Secondary and Highway Business District on May 27, months after approving a zoning amendment in the district to facilitate the revenue-generating STP program there.

The city’s first STP agreement was made with The Woodlands-based Preva Health and Spring Pines LLC for space at 26620 I-45 N., Oak Ridge North. The agreement was unanimously approved by council in a 5-0 vote following a closed executive session.

The new program allows prospective nonretail tenants to apply to enter the highway business district, which is now zoned for only retail stores, restaurants and wholesalers with a retail component. Through individual STP agreements, nonretail tenants approved by the council may operate in the B-2 district if their property owner provides the city with quarterly payments in lieu of the sales tax that would otherwise be generated by a retail- or dining-based tenant.

The program was developed last year to allow property owners more options to fill their vacant spaces given the B-2 district’s retail restrictions while providing the city with revenue lost from bringing in new businesses that do not generate sales tax. The agreement approved May 27 will provide the city with $1.50 per square foot annually at the I-45 frontage road office for the first two years of the agreement, City Attorney Chris Nichols said. That rate will rise to $1.80 per square foot in either the third or sixth year of the 100-month agreement depending on whether or not a purchase at the property is completed within the initial two-year period.

Earlier in the meeting, council members also unanimously approved a $42,800 payment to MMG Contractors for adjustments to a water line and water valves in the area of Montgomery County’s Robinson Road expansion project on the city’s western edge. Council had previously approved spending up to $75,000 for the work, which was identified as an issue in the midst of the county contractors’ project and deemed necessary to keep those improvements on track.

“The contractor did everything and fixed the leak and gave us three new good valves so that we can isolate that whole system now a whole lot better, which we weren’t able to do,” Public Works Director Joe Sherwin said. “We did the project in about a week, and the county was not impacted in their schedule.”