The Guidelines and Criteria governing Tax Abatement for Industrial Projects in the City of Lubbock have expired, and in order for the City of Lubbock to continue participating in tax abatement, new guidelines have to be adopted. The proposed guidelines contain minor grammatical changes, as well as updates to the capital investment and job creation criteria to qualify for application. Tax Code Section 312.002 requires that the governing body of a taxing unit hold a public hearing regarding the proposed adoption, amendment, repeal, or reauthorization of tax abatement guidelines and criteria, at which point members of the public are given the opportunity to be heard. This public hearing was held on April 9, 2024. Below is a general summary of the proposed industrial tax abatement guidelines:
- General Purpose: To promote high quality development in all parts of the City
- Maximum Term: 10 Years
- Eligible Property: Improvements to Real Property, Tangible Personal Property, onsite raw materials, works in progress, supplies and tools
- Non-Eligible Property: Real Property, finished goods, furnishings and other forms of movable personal property, vehicles, aircraft, housing, boats, hotel accommodations, motel accommodation, retail businesses, property owned by the State of Texas or any State agency, and property owned or leased by a member of the affected Jurisdiction that did not have an active tax abatement in place before they became a member of the governing body
- Types of Companies: Advanced Technologies and Manufacturing, Manufacturing, Research and Development, Medical Services (as defined in Section II, Definitions), Warehouse / Distribution, Corporate Headquarters of a Regional / National Service Center, Information and Data Centers, or, the project is not included as a target industry, but has the potential of generating additional significant economic development opportunities for Lubbock
- Location: Anywhere within the jurisdiction, inside an Enterprise Zone or a Reinvestment Zone
- Other Eligibility Requirements: To qualify, a company must modernize or expand an existing facility or construct a new facility and be a producer, manufacturer or distributor of goods and services of which 50% or more are distributed outside of Lubbock County
- Investment / Job Criteria:
- New Company: The project will add at least $10 million in real property improvements or new personal property, or a combination of the two, and 25 new permanent jobs
- Existing Company: The project will add at least $10 million in real property improvements or new personal property, or a combination of the two, and 25 new permanent jobs
- Qualifiers: Approving the guidelines does not obligate the jurisdiction to provide tax abatement to any applicant
Eight Industrial Tax Abatements have been granted in the City of Lubbock since 2010. Six are 5-year declining, and two are 10-year, 100% abatement:
- Red River Commodities: 5-year, declining abatement
- X-Fab Expansion (2011): 5-year, declining abatement
- X-Fab Expansion (2014): 5-year, declining abatement
- United Supermarkets Llano Logistics Distribution Center: 5-year, declining abatement
- Monsanto Seed Processing Facility: 10-year, 100% abatement
- Leprino Foods: 10-year, 100% abatement
- X-Fab Expansion (2023): 5-year, declining abatement
- DuraLine: 5-year, declining abatement
If approved, the effective date of the Industrial Tax Abatement Guidelines will be April 23, 2024. |