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ECONOMIC DEVELOPMENT INCENTIVES
CITY OF ROBSTOWN
Economic Development Corporations
• Created by cities to attract business and create job
opportunities. Cities may adopt a dedicated sales tax to fund industrial
development projects and improve their appeal as places to reside, work
and visit.
• Economic Development Sales Tax know as 4A or 4B
• 4A is more limited than 4B
• Robstown has a 4B Sales Tax
Tax Abatements
• Except for schools, taxing entities may abate 100%
of taxes for up to 10 years for new manufacturing operations or new
businesses
• Taxes on land, existing buildings (except for
improvements) and rolling stock are not abatable
Non-Annexation Agreements
• Cities may contract with new businesses within their
Extra Territorial Jurisdiction (ETJ) to not annex them for up to 7 years
• City may provide city services such as police and
fire protection for a Payment in Lieu of Taxes (PILOT)
Reinvestment Zone
• Cities may designate a contiguous geographic area a
Reinvestment Zone if the city determines development or redevelopment
would not occur solely through private investment
• Cities must prepare a financing plan for the zone
• To be selected the area must impair the sound
growth, deter an economic, social or health liability
Tax Increment Financing
• Used to publicly finance needed public improvements
and enhance infrastructure in a Reinvestment Zone
• Cost of improvements is repaid by future tax
revenue, known as Tax Increments, that is attributable to the increase
in property values due to improvements in the zones
• Except for schools, all taxing entities can
participate
• Can be initiated by a City or a petition of owners
of at least 50% of the appraised property within a zone
• City may issue TIF Bonds to pay for improvements
Industrial Revenue Bonds
• Industrial Development Corporations can issue tax
exempt, or taxable, bonds for industrial development
• Companies seeking IRB'S are responsible for finding
purchaser for the bonds or have the bonds privately placed
• IDC'S assist in structuring the issue to qualify for
a tax exemption and acts as a conduit through which funds are channeled
State of Texas Incentives
• Sales Tax Refunds-administered by the Comptroller,
allows some companies to receive reimbursement on their net sale and
franchise taxes for paying local school taxes
• Texas Main Street Program-helps cities revitalize
their historic downtowns
• Jobs-creation Franchise Tax Credit-allows a credit
of 5% of wages paid for new qualifying jobs created in Strategic
Investment Areas (counties having both higher than statewide
unemployment rates and lower than statewide per capital income)
• Capital Investment Franchise Tax Credit-allows a
credit of 7.5% against franchise taxes for qualified investments in an
SIA
• Workforce Investment Act-provides funds fore
services to help individual gain or regain employment
• Brownfield Cleanup-assists with the clean-up of
contaminated property for redevelopment
• Texas Capital Access Fund-increases the availability
of financing for businesses that face barriers in accessing capital
• Texas Leverage Fund-a source of financing for
communities that have passed the economic development sales tax
• Grants-the Office of Rural Community Affairs (ORCA)
awards grants to cities for certain projects to benefit low-to-moderate
income households
• Texas Enterprise Fund-"a deal closing fund" agreed
to by the Governor, lt. Governor and Speaker
Summary
Another major incentive is the state's low tax burden:
• 32% less than the national average
• No personal income tax
• No state tax on machinery and equipment used in
manufacturing
• No state tax on property used for pollution control
• No state tax on goods in transit
• There are a multitude of incentives available to
assist cities in their efforts to improve the economic stability of
their community
• Limited only by imagination, resources and state
laws
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