MH firm buys Dan Gamel RV Center dealership
Morgan Hill’s Dan Gamel RV Center, a major sales tax generator for the city, has been sold to Alpine Recreation for an undisclosed price.
The ownership change will be effective April 1.Employees at the Gamel dealership have been invited to fill out job applications for Alpine, said Pat Kennedy, Alpine president.
Some of the approximately 50 people based in Morgan Hill have been offered jobs at the other seven Gamel RV dealerships.
“It was the economic situation there in Silicon Valley,” Gamel owner Wayne Barnes said Tuesday from the firm’s Fresno headquarters about the sale. “A lot of jobs continue to move out of the area.”
Kennedy sees the deal as positive for Alpine and Gamel.
“We’re going to be expanding our service. There will be a lot more room,” Kennedy said Tuesday. “We’ve outgrown our existing facility (19380 Monterey Road). We will be a lot more visible in the community and the Highway 101 corridor. I’m really happy we’re able to stay in Morgan Hill.”
City Manager Ed Tewes said the two dealerships are in the top five of sales tax revenue for Morgan Hill. Sales tax is the top revenue source for the city’s general fund that pays for public safety, recreation and most administration costs, among others.
“The RV industry is important to the city. The good news is that Alpine wants to expand,” Tewes said, “although it is disappointing to lose such a major sales tax generator.”
The city receives 1 percent of the 8.25 percent tax levied on purchases subject to sales tax. In September 2004, the city and Gamel agreed to a second 10-year sales tax sharing plan. The low rung of the new agreement was that the city would return 30 percent of sales tax revenue for annual sales up to $32 million and 67 percent of sales up to $90 million.
The initial agreement, which expired in September 2001, called for the city and Gamel to share equally in sales tax revenue.
The city is on track this fiscal year to receive $4.9 million in sales tax revenue from all sources. In fiscal year 2001-02 the city’s sales tax revenue topped out at $5.5 million. Its lowest point was $4.1 million in 2003-04.
The revenue decline occurred during a national recession that hit Silicon Valley industries hard. Also, Tewes pointed out, residents continue to make purchases outside the city, which reduces potential city revenue. Morgan Hill Gamel employees were told of the sale Monday by Barnes.
“Businesswise, it was a no-brainer,” Barnes said. “Emotionally it was tough. My first day on the job in the RV industry was in the Morgan Hill store.”
Alpine, which has been Morgan Hill since 1964, offers new RVs, pre-owned RVs, parts and accessories and service. The price range for new and used RVs is $5,000 to $550,000.
Gamel sells Fleetwood manufactured RVs. Barnes said he anticipates Fleetwood will allow Alpine to service that company’s vehicles.
