By Tim Olsen
From the September/October 2014 issue
If Texas seems laser focused on creating jobs, it’s because the Lone Star State loves to compete. Without a doubt, Texas has been crushing the competition in the high stakes battle for jobs for more than a decade.
Texas is home to just eight percent of the U.S. population, but 35 percent of all new private sector jobs in America since 2000. In survey after survey—including the 2014 Business Facilities annual Rankings Report—the state’s economy consistently ranks among the best in the nation, and employment in Texas has grown three times faster than other large states.
In 2014, for the 12th consecutive year Texas has led the nation in exports. In January, the state surpassed California, home of Silicon Valley, to become the country’s top exporter of technology. A key factor in that success is the state’s high quality infrastructure. TX was the top-ranked state for Best Infrastructure in our 2014 State Rankings Report.
It’s no surprise, then, that more people are moving to Texas than any other state—along with companies like Apple, SpaceX and Toyota, all of which have announced major expansions in the Lone Star State in recent months.
It might sound miraculous, but don’t call it the “Texas miracle” within earshot of Gov. Rick Perry. “A miracle can’t be readily explained,” Perry counters. “The Texas experience can.”
Perry and Texas business leaders cite an employer-friendly combination of low taxes, fair courts, smart regulations and a world-class workforce as the secret to the state’s success.
With no corporate income tax or personal income tax, Texas has the 4th lowest overall tax burden in the country. Manufacturers can qualify for significant tax exemptions, and state leaders also have reinstated the R&D Tax Credit for qualified research activities. Local governments offer significant property tax breaks, in exchange for jobs and capital investment.
And when it comes to incentives, Texas plays to win. The state continues to leverage the power of the Texas Enterprise Fund, a deal closing fund that is the largest 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 close deals that offer significant job creation and capital investment.
To date, the program has awarded $575 million in grants to win projects that will generate $24 billion in capital investment and create 77,000 direct jobs.
Texas also is betting on early-stage tech companies with the Emerging Technology Fund, which to date has offered $205 million in incentives to help start-ups bring their ideas from the lab to the marketplace. The fund also lures top talent to Texas universities.
THE CITY OF SUGAR LAND: AHEAD OF THE CURVE
The City of Sugar Land is an award-winning community located 20 miles southwest of Houston. This master-planned community has achieved its sustainable, strong local economy through a strategically focused and aggressive economic development program, creating new wealth and jobs.
As a regional employment center, the City is home to numerous high-profile regional and international corporations, including Minute Maid, Schlumberger, Fluor Corporation, Noble Drilling Services, Texas Instruments, Bechtel EO, Aetna and UnitedHealth Group, housed in over 25 million square feet of commercial space.
Sugar Land’s location stands high above the rest with easy access to highways, rail and air transport. The Sugar Land Regional Airport provides corporate aviation services with U.S. Customs to over 100 Fortune 500 corporations and its Fixed Base Operator (FBO), Global Select, is consistently ranked among the top FBOs in the Americas. In addition, Sugar Land is close to two major commercial airports (Bush Intercontinental and Houston Hobby).
Sugar Land’s highly educated workforce also is ahead of the curve with 55 percent with a bachelor’s degree or higher. Sugar Land is home to higher education institutions, such as University of Houston at Sugar Land and Wharton County Junior College. In addition to undergraduate and associate programs, the campuses offer non-credit courses that cater to community and business needs, including workforce training programs in partnership with the Office of Economic Development.
Sugar Land has positioned itself as a hub for premium shopping, dining and entertainment. Venues such as the Houston Museum of Natural Science at Sugar Land and the minor league ballpark Constellation Field—home of the Sugar Land Skeeters—further establish the community as a cultural and entertainment destination. Additionally, the City expects to break ground on an approximately 6,500-seat performing arts center, a public-private partnership with ACE Theatrical group, before the end of the year. This project was identified by a 2007, citizen-appointed Visioning Task Force as a preferred entertainment venue that would fulfill the vision of developing Sugar Land as a destination location for living, working, shopping, health care, education and entertainment.
Sugar Land’s Office of Economic Development continues to be successful in attracting numerous high-profile regional and international corporate relocations in a variety of industries including engineering, technical services, energy exploration and production, technology and research, life sciences and communications. In addition to attracting new companies, the City is proud of its existing businesses that are continuing to prosper. This is evident through the recent expansion announcements.
Applied Optoelectronics, Inc. (AOI)—a leading provider of fiber-optic access network products for the cable broadband, internet data center and fiber-to-the home markets—has announced that it will expand its headquarters and manufacturing facility in Sugar Land, a move that will bring over $30 million in investments, retain 235 jobs and add 530 new jobs over a 10 year period.
AOI has experienced significant growth over the past year, achieving a 70 percent revenue increase in the first six months of 2014. Given the foreseeable growth in laser components in the markets AOI serves, the company plans to expand its headquarters and build new research and development (R&D) and manufacturing facilities, totaling approximately 111,600 square feet.
The company decided to expand its facilities in Sugar Land after evaluating options overseas. The new facilities will be located adjacent to AOI’s existing building in the Sugar Land Business Park. Construction is expected to be completed late 2015. The City of Sugar Land and the Sugar Land Development Corporation approved agreements to support AOI’s development plans.
Nalco Champion, an Ecolab company, has announced plans to consolidate its Houston-area offices and centralize its headquarters in Sugar Land. The company will build a new, approximately 133,500-square-foot facility with 1,000 parking spaces. Existing buildings will be reconfigured to maximize office space, accommodate supply chain needs and create additional space for the expansion of the company’s R&D facilities. Construction is expected to be completed by early 2016.
The company decided to centralize its headquarters in Sugar Land after a comprehensive evaluation of other regional opportunities. The new, centralized Nalco Champion headquarters and expanded R&D represents more than $45.4 million in new capital investment, creates more than 860 new jobs, recaptures nearly 250 jobs previously moved to Houston from Sugar Land and retains more than 340 jobs. The multi-faceted incentive package was created by the City’s Office of Economic Development and approved by both City Council and the Sugar Land Development Corporation to secure the retention and expansion of Nalco Champion’s office and R&D presence in Sugar Land.
The Office of Economic Development provides site location services, incentive packages, demographics, wage and labor data, permit fast tracking, comparative site and impact analysis, tax data, mapping and other relocation services.
MARBLE FALLS, TX: OPPORTUNITIES ABOUND
Known for scenic vistas and pristine waterways, 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 community is able to strike the perfect balance between small-town charm and big-city amenities, leading to an unparalleled quality of life. 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 all have 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. The newest business in the Park is a philanthropic microbrewery that is earning accolades every week. 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. Today, the amount of building activity is unprecedented, with more than $108 million worth of building permits issued in the last twelve months. Initiatives such as Build Marble Falls—a program that waives building permit and tap fees for all new, single-family homes constructed in the city—illustrate the City’s commitment to making Marble Falls affordable for young families.
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.
Healthcare in the region also is expanding with the opening of the Baylor Scott & White specialty clinic in 2014 and the Hurd Regional Medical Center in 2015. More than 500 people will be employed at these facilities, and the projected economic impact to the community over the next 10 years is nearly a billion dollars—this is a strong addition to an already-robust economy.
With more than $350 million in annual taxable sales, Marble Falls is one of the top 10 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.
Young professionals are finding prosperity in Marble Falls. With a cost of living lower than the national average, recognized schools and over 100 acres of connected park space, it’s easy to see why Marble Falls is becoming such a popular destination.