El Paso’s Paul Foster and a national development company, Regency Centers, told the El Paso City Council on Tuesday that they will need $12 million tax rebates from the city and county to make a $60 to $100 million lifestyle center possible on the 50-acre site of the old Farah Manufacturing headquarters near Cielo Vista Mall.

The 10-years of property and sales tax rebates, they said, would not help retailers in the new center but would defray nearly half of the developer’s initial $21 million cost of demolishing the Farah buildings and preparing the site for development.

Foster and Regency are seeking the rebate of $8 million in sales and property taxes from the city and $4 million from the county.

If the deal goes, the deserted buildings, now surrounded by cyclone fence and razor wire, where 10,000 garment workers were once employed would be replaced by a lavish, splashy,

outdoor shopping center called The Fountains.

In the works for nine months, the proposal was before City Council for discussion only, but it was apparent that the council members liked the idea, though not all the elements of the proposal.

Several major business organizations, including the Greater El Paso Chamber of Commerce, voiced their support for the project.

Chamber President Richard Dayoub noted that every developer that has proposed developing the Farah site came to the city for tax incentives to make it work as well.

“The current proposal is the least expensive proposal to day for the removal of the blight,” Dayoub said. “In each case, we have walked away.”

The public investment would come from taxes the city and county are not receiving now on a property now valued at $20.7 million that only generates $214,000 in property taxes a year.

Citing the Foster-Regency’s numbers, he said the construction project alone would employ 2,500 workers and cost more than $100 million.

“If we do not move forward with this project, any future development for this site will cost us dearly and a good deal more,” he said. “In past years, how many dollars in ad valorem taxes have we lost?”

Simon Properties, which owns the Cielo Vista and Sunland Park malls, opposes the project on grounds that it could lure retailers away from the malls and other shopping centers, diluting the market and creating vacancy problems in those shopping centers.

Paul Foster’s partner, Brent Harris, said Simon had been among the companies that sought to partner with Foster on the development of the Farah site.

“If we had gone with Simon, they would have been beside us asking for incentives,” Harris said.

He said the last developer that approached the city sought $17 million in tax breaks in 2005.

Mark Benitez, president of the Cielo Vista Neighborhood Association, said the people who attended two public meetings on the project overwhelmingly supported the project.

“We have an incredible opportunity to do something good for the city of El Paso,” he said.

Dan Olivas, president of the El Paso Board of Realtors, said Foster and Regency intend to put their money up first for the demolition and the construction and if for some reason the project is not completed and opened, the city and county would lose nothing.

“Our association is solidly behind this project, and we implore you to look favorably on it,” Olivas said.

At the end of the presentation and discussion, Mayor John Cook set the tone for the coming negotiations, saying he would support a 100 percent property tax rebate for 10 years or longer, and a significant break on dumping demolition debris at the city dumps.

He said he would also back rebates of sale taxes on retail sales for the retailers new to the El Paso region that move in to The Fountains but not for stores that are doing business in El Paso now.

Council members generally agreed with those terms and asked that the city’s economic development staff continue negotiating with Foster and Regency and try to come back with a revised proposal in two or three weeks.