By Shana Daley
From the September/October 2013 issue
Month after month, the Lone Star State tops rankings for business climate, job growth and growing communities. This isn’t an accident. Texas isn’t resting on laurels or stuck on past platitudes. With a fair legal system that doesn’t suffer from frivolous lawsuits, a skilled workforce of more than 12.8 million people and a nation-leading state infrastructure, it’s ensuring the future is as bright as the present.
With multiple programs offering competitive incentives and financing to qualified recipients, Texas’ commitment to the economy, the people, and quality of life is without equal. These programs provide companies moving to or relocating within Texas opportunities at workforce development programs, tax incentives and grants above and beyond what can be offered at the local level. Two of these funds—Texas Enterprise Fund and Texas Emerging Technology Fund—have offered over $498 million and $203 million, respectively, to help ensure the growth of Texas businesses.
INVESTING IN THE FUTURE
Texas is investing in its future by offering competitive incentives to companies creating jobs and driving innovation in the state. This is exemplified by the Texas Enterprise Fund (TEF), the largest “deal-closing” fund of its kind in the nation. When a single Texas site is competing against viable out-of-state options, the TEF provides a financial incentive to bring home projects that offer significant job creation and capital investment. Award amounts, ranging from $194,000 to $50 million, vary based on the number of jobs to be created, the expected timeframe for hiring and the average wages to be paid. Through the end of 2012, the program had awarded $487.41 million in grants, announced 66,094 jobs and generated more than $17.38 billion in capital investment.
Another popular economic development incentive offered by the state is the Texas Enterprise Zone Program, which enables local communities to partner with the State of Texas to promote job creation and significant private investment, helping assist economically distressed areas of the state. Approved projects are eligible to apply for state sales and use tax refunds on certain expenditures, with the level and amount of the refund related to capital investment and jobs created at the qualified business site. Refunds can range from $25,000 to $3.75 million.
Manufacturing companies can qualify for significant tax exemptions, including state sales and use tax exemptions available to taxpayers who manufacture, fabricate or process tangible property for sale. The exemption generally applies to tangible personal property involved in the manufacturing process. Texas manufacturing companies may also be exempt from paying state sales and use tax on electricity and natural gas used in the manufacturing process.
The Texas Economic Development Act, popularly known as Chapter 313, allows an appraised value limitation to be extended to a taxpayer who agrees to build or install property and create jobs in exchange for an eight-year limitation on the taxable value of the property. The value limitation applies to the local school district maintenance and operations tax (M&O) portion of the property tax and a tax credit.
Texas’ commitment to growth through innovation is manifested in the Texas Emerging Technology Fund (TETF), a grant program designed to expedite the development and commercialization of new technologies through partnerships between the state, higher education institutions, and private industry. The TETF effectively focuses greater attention on the research, development, and commercialization of emerging technology. Through the end of January 2013, the TETF has allocated more than $200 million in funds to 140 early stage companies, and $216 million in grant matching and research superiority funds to Texas universities.
With a GDP estimated at $1.4 trillion, the Texas economy would be the 13th-largest in the world if it were a stand-alone nation. Texas’ vibrant economy—made possible by the state’s superior workforce, excellent business climate, central location, relatively low production costs and aggressive incentive funding—continues to draw companies from around the country and around the world, proving time and again that Texas really is “Wide Open for Business.”
In a national economy still recovering from a recession, Texas has forged ahead of the pack as a result of a superior business climate, ranking as the “Best State for Business” by Chief Executive Magazine for the ninth straight year in 2013. It’s no wonder that Texas is home to more than 50 Fortune 500 companies.
A key ingredient to Texas’ success is its comprehensive job creation strategy focused on six key industry clusters: Advanced Technology and Manufacturing; Aerospace, Aviation, and Defense; Biotechnology and Life Sciences; Information and Computer Technology; Petroleum Refining and Chemical Products; and Energy. As a result of focusing state economic development efforts in these areas, Texas has experienced robust job growth. In the last 10 years, Texas has generated nearly 1.8 million new jobs—more than three times the number of any other state. Texas’ climate of success and prosperity has led thousands of companies to move here, stay here, and grow here. From corporate giants to rising stars, businesses and jobs are flocking to the Lone Star State.
LUBBOCK IS THE HUB CITY
A “hub” for retail, health care, education and more, Lubbock is widely known as the “Hub City.” The nickname is also related to Lubbock’s accessible location on the crossroads of Interstate 27 (I-27) and four major U.S. highways. Lubbock’s diverse economy is based on manufacturing, agriculture, wholesale and retail trade services, as well as government, higher education and health care. Companies looking to expand or relocate look to the Lubbock Economic Development Alliance (LEDA) as a single point of contact when it comes to connecting resources for financial incentives, workforce initiatives, cost of doing business data, real estate, transportation information and more.
With a regional population base of more than 626,409 people, Lubbock’s size affords businesses access to dedicated community leaders and personalized service, while providing you with a pipeline of skilled and talented personnel to fill your workforce needs. In the third quarter of 2013, total employment in the Lubbock Metropolitan Statistical Area (MSA) was 145,608, a growth of 1.75 percent from the third quarter of 2012. A strong increase was shown in retail trade along with accommodation and food services, as well as construction. The greatest increase was found in professional, scientific and technical services with a growth rate of 6.14 percent.
Home to Texas Tech University, two private universities and a fast-growing community college, Lubbock County boasts more than 50,000 college students. Texas Tech is the only campus in the nation with a comprehensive university, a health sciences center, an agriculture college and a law school in one location. Texas Tech’s enrollment numbers have seen a steady increase over the past few years. The 2012 fall semester saw 4,564 new freshmen students, and the 2011-2012 school year saw 4,941 bachelors degrees conferred. Texas Tech, Wayland Baptist University, Lubbock Christian University and South Plains College continue to provide top-of-the-line education to students who have a high probability of joining the Lubbock workforce after graduation.
Every business should be assured that the utilities of an area can ably meet their current demands, as well as any future needs that they might have. Lubbock has met this challenge by keeping its utilities infrastructure current and has displayed foresight by taking the necessary steps to meet future demands should they arise. Lubbock is one of the most affordable cities in Texas in regards to the cost of doing business and the cost of living. In fact, Lubbock is ranked No. 1 in the nation for lowest cost of utilities and No. 32 in the nation for lowest cost of living according to The Council for Community & Economic Research (3rd Quarter 2012).
Lubbock’s real estate opportunities are vast and steadily growing. The Lubbock Business Park is a 586-acre tract of land located on I-27 approximately one mile south of Lubbock Preston Smith International Airport. Shovel-ready sites and notable companies reside in the Lubbock Business Park today. Located just north of the airport is the Lubbock Rail Port, a 526-acre tract of land that provides convenient access to I-27, the airport and the BNSF Railway. The Lubbock Rail Port is buzzing with activity thanks to an additional 200 acres and $1.5 million matching grant from the U.S. Department of Commerce Economic Development Administration.
Lubbock is ready for your business. Since 2004, LEDA has assisted 124 companies in their expansion or relocation to Lubbock. The team at LEDA offers a number of incentive options including financial resources to offset costs associated with the relocation or expansion of a business. LEDA believes that every economic development project is unique and that each project should get the attention it deserves.
MARBLE FALLS: GATEWAY TO CENTRAL TEXAS
Marble Falls is the gateway to the Highland Lakes of Central Texas. It is the regional hub for about 30,000 people living within 10 miles of town and has primary and secondary trade area populations of 66,000 and 140,000, respectively. The natural beauty of the Hill Country and constant-level lakes combine to make the area ideal for professionals and tourists alike. The area has many resorts and recreational opportunities, from wineries and state parks to spas and top-flight golf courses. Marble Falls has garnered acclaim for its special events and vibrant arts scene, and is consistently rated as one of the top retirement destinations in the country. Money Magazine, Southern Living, Texas Highways, and others have all recently chimed in on what makes Marble Falls special.
But being called “postcard pretty” (The New York Times, Nov. 2, 2007) doesn’t mean that Marble Falls is merely a great place to kick back and relax; the community is serious about business as well. Its central location—just about an hour’s drive from Austin or San Antonio, and about three hours from Dallas/Fort Worth or Houston—makes Marble Falls a great choice for commercial prospects. US 281, RM 1431, and SH 71 provide access to several areas zoned for light industrial uses as well as a Business & Technology Park that continues to expand. Low land costs in the Park, infrastructure support, and a triple freeport exemption are among the incentives available to businesses relocating to or expanding in Marble Falls.
Moreover, the Marble Falls leadership community has worked hard over the last several years to streamline the development process. New planning documents, including an updated Comprehensive Plan and Master Plans for both the Park System and Downtown, convey the vision desired by area citizens.
In addition, higher education opportunities are developing in the area. Currently, Texas Tech University and Central Texas College offer a variety of courses and degree programs to meet the needs of students in the Highland Lakes area. While many people travel to Marble Falls to take courses, workforce development is clearly a benefit.
It is also interesting to note that Marble Falls is one of the top ten producers of sales tax per capita in the state of Texas. Retailers range from big-box establishments to quaint boutiques, and from franchise restaurants to locally-owned eateries, including the world-famous Blue Bonnet Café. Daily traffic counts surpass 35,000 vehicles in the center of town.
Those who live and work in Marble Falls contribute to a very desirable quality of life. With a cost of living significantly lower than the national average, recognized schools, over 100 acres of park space, easy access to amenities, and a high level of community involvement, it is easy to see why Marble Falls is becoming such a popular destination.
TOMBALL IS TRUE TO ITS ROOTS
When Thomas Henry Ball convinced the Trinity and Brazos Railroad to run through Tomball in the early 1900s, little did he know what a significant economic impact that would have on the area. A few decades later, the discovery of oil made an even more momentous influence in the development and success of the community.
But one thing can be said for Tomball, no matter how much time goes by and things change, the railroad and oil industries are still major players in the local economy. Many area residents are saying the community’s history is now coming full circle with the addition of well-known oil businesses that will no doubt bring even more prosperity to an already very successful region.
Located along State Highway 249, just 28 miles northwest of downtown Houston, Tomball is included in a part of Texas, nicknamed the Energy Corridor. The area gained this title thanks to the many companies that were attracted to it after the oil boom in the early 1930s. Today, two of those companies are setting up shop and expanding facilities in the community.
Baker Hughes, an existing Tomball employer, currently operates its Pressure Pumping Technology Center in the city with a focus on pressure pumping products and services for the oil and gas industry. The company operates with more than 58,000 employees in 80 countries. In 2012, Baker Hughes announced plans to construct a new Western Hemisphere Education Center to be located at the corner of FM 2920 and FM 2978. The Baker Hughes Western Hemisphere Education Center project involves the development of a 72,445 square foot 3-story education building with 40 classrooms, auditoriums, breakout rooms, simulation rooms, a laboratory, cafeteria and office space, a 36,000 square foot five-bay workshop, and a 156,000 square foot yard with two non-producing training wells.
With the new Baker Hughes Western Hemisphere Education Center anticipated to be complete by 2014, Tomball will be host to approximately 66,000 trainees and corporate professionals from around the world each year. This project builds upon Baker Hughes’ existing presence in the city of Tomball and shows a tremendous commitment to expand our local economy. The Baker Hughes Eastern Hemisphere Training Center is located in Dubai.
Additionally, ExxonMobil has begun constructing a 385-acre campus that will be situated in close proximity to Tomball. The company will relocate several of its divisions including ExxonMobil Chemical Co., ExxonMobil Research and Engineering Co. and ExxonMobil Fuels, Lubricants & Specialties Marketing Co., to the site when completed. The location will house upwards of 10,000 employees when it’s fully staffed in 2015. However, those individuals will be using more than just office space in the development. Plans are in the works for conference and training centers, a childcare facility and a wellness center.
TAYLOR, TX: LAND OF OPPORTUNITY
Located northeast of downtown Austin, Taylor is on the progressive edge of a suburban landscape. Taylor offers idyllic small town charm, with activities and opportunities that families and businesses seek out.
Taylor offers free or reduced cost land with the Taylor Economic Development Corporation’s (TEDC) Land Grant Program, which is a forgivable loan program based on the market value of the land. There is no down payment to enter a land grant contract and the borrower owns the land for equity at closing. As long as net community impact requirements are met, there is no principal or interest payments required. If the project is successful and the number of required jobs and capital investment projections are met, the loan converts to a grant upon maturity at the end of ten years.
Other opportunities in Taylor include:
- Taylor EDC owns land in two industrial parks that can be considered for the Land Grant Program.
- The City of Taylor offers a generous rental assistance program for companies locating in downtown Taylor.
- Aggressive incentives are also available for qualified projects.
- The Taylor General Aviation Airport, rail system and highway system provide quick and easy access to the area.
- Workforce in Taylor is plentiful; over a hundred thousand potential employees are within a 30-mile radius of Taylor. Texas is a right to work state and there is no state income tax, resulting in lower labor costs. Entrepreneurial workshops and leadership programs are sponsored by the Taylor EDC and are held on a regular basis to enrich the skills of the local workforce.
- Small business counseling services are also available through the Taylor EDC.
New additions to Taylor include HDI Plastics, Inc. a local company that recycles thermoplastic waste into reusable resin pellets. The pellets are purchased by manufacturers who create new plastic products. HDI Plastics is the only location in Central Texas that recycles polystyrene (plastic #6).
JMF Materials is a welcomed addition to Taylor, having relocated from Round Rock. With their 8,000 square foot building under construction, they will soon be ready to transport sand, concrete, gravel and rock.
Growing by leaps and bounds, international company Durcon, Inc. has created an additional 80 jobs in Taylor this year, bringing their total number of employees to 470. Durcon, Inc is the world’s leading manufacturer of laboratory-grade work surfaces.
Taylor is home to the Operations Center for ERCOT (The Electric Reliability Council of Texas). ERCOT manages the flow of electric power to 23 million Texas customers—representing 85 percent of the state’s electric load. ERCOT schedules power on an electric grid that connects 40,500 miles of transmission lines and more than 550 generation units.
As a member of Texas One, Taylor EDC benefits from statewide economic development programs that target corporate decision makers and site selectors. As a member of the Greater Austin Chamber of Commerce, Taylor EDC also benefits from a more localized approach to economic development efforts.
Existing businesses in Taylor also get help from the TEDC through our vigorous Business Retention and Expansion Program. This program is used to assist Taylor businesses with expansions and resolution of critical issues, as well as keeping open the lines of communication and building relationships within the community. Studies show that up to 80% of new job growth comes from existing businesses.
In an effort to keep Taylor businesses and citizens informed of the activities of the TEDC and community, we hold a public breakfast meeting on the First Friday of each month.
Taylor provides a one-stop shop for a new company’s business development, including incentives, permitting, utilities, and workforce development. The Taylor EDC will serve as a liaison to help meet all needs in these areas.