CC MEETING: December 5, 2023
DATE: November 27, 2023
TO: Erin Rinehart, City Manager
FROM: Robert Winningham, Director of Economic Development
Marc Guy, Assistant City Manager
Title
Consider A Resolution Authorizing The City Manager To Negotiate And Execute An Economic Development Incentive Agreement With DuraPlas, Inc., Establishing A Program Of Tax Rebate Grants To The Company For The Relocation Of Its Headquarters And Manufacturing Operations To 2395 Midway Road, In Amounts Equal To Fifty Percent (50%) Of Taxes Paid To The City On The Assessed New Value Of Business Personal Property For A Maximum Term Of Three (3) Years, And A Second Grant In Amounts Equal To Fifty Percent (50%) Of Taxes Paid To The City On The Assessed New Value Of Business Personal Property And Real Property For A Maximum Term Of Three (3) Years After Issuance Of A Certificate Of Occupancy On A New Building To Be Constructed, For A Total Incentive Amount Not To Exceed $481,284.
Body
BACKGROUND:
This agenda item is to consider a resolution authorizing the City Manager to negotiate and execute an economic development incentive agreement with DuraPlas, Inc.
DuraPlas, Inc. is a manufacturer of plastic products used primarily in the agriculture sector. The company is considering relocating its headquarters and manufacturing operations to 2395 Midway Road in Carrollton.
The company will acquire and redevelop the property, removing existing structures valued at approximately $23.4 million. During the first three (3) years of site planning and demolition, the company will use a portion of the property to store approximately $3 million in business personal property.
DuraPlas, Inc. will begin construction in year four of at least 650,000 square feet of office, manufacturing and warehouse space, adding new product lines that would require the installation of new machinery with an approximate value of $50.5 million, plus approximately $40 million in improvements to the property. Additionally, the company plans to create 304 full-time jobs with an average annual salary of $50,680, plus benefits, over the first ten (10) years of operation in Carrollton.
FINANCIAL IMPLICATIONS:
Staff recommends establishing a program of rebate grants to the company in amounts equal to fifty percent (50%) of taxes paid to the City on the assessed new value of business personal property for a maximum term of three (3) years, and a second grant in amounts equal to fifty percent (50%) of taxes paid to the City on the assessed net new value of business personal property and real property for a maximum term of three (3) years after issuance of a Certificate of Occupancy on a new building to be constructed, for a total incentive amount not to exceed $481,284.
IMPACT ON COMMUNITY SUSTAINABILITY:
Should DuraPlas, Inc. choose to relocate its headquarters to 2395 Midway Road the company will create new jobs and increase the net ad valorem value of the property by constructing a new headquarters and manufacturing building.
STAFF RECOMMENDATION/ACTION DESIRED:
Staff recommends City Council approval of a resolution authorizing the City Manager to negotiate and execute an economic development incentive agreement with DuraPlas, Inc. for its relocation to 2395 Midway Road.