2018-020 Incentive SummaryDate: February 15, 2018 Report No. 2018-020
INFORMAL STAFF REPORT
TO MAYOR AND CITY COUNCIL
SUBJECT: Summary of current and future economic development incentives
BACKGROUND:
Councilmembers requested information regarding economic development incentives that have
been approved by City Council. The attached spreadsheet briefly summarizes the currently active and future incentives. In
addition to those listed in the summary, nine incentives have completed their terms and another
four have been terminated.
The summary document is intended to give Councilmembers a quick overview of approved agreements. Staff is happy to answer further questions and provide more detail regarding the
background, terms, and performance of any incentive listed.
STAFF CONTACT:
Caroline Booth, Director of Economic Development 940-349-7751
Caroline.Booth@cityofdenton.com
Current and Future Incentive Agreement Summary
Company Industry Project Type Agreement
Term
Incentive Threshold/Requirement To Be Met To
Receive Incentive
Performing Incentive Paid thru
FY 16-17
Net Revenue
to City
Tetra Pak Materials aseptic food/beverage
packaging manufacturing
(North American
headquarters)
Expansion 2015-2018 65% on building and equipment (increment above
base valuation)
$5 Million above base year valuation
Yes $64,531 $52,515
Peterbilt Motors heavy-duty truck
manufacturing
(headquarters)
Expansion 2016-2023 70% on building and equipment (increment above
base valuation)
$18.5 Million above base year valuation No (did not
meet
threshold to
receive a
payment in FY
16-17, but
incentive does
not terminate
per
agreement)
N/A N/A
West Gate Business
Park
Class A
commercial/industrial
buildings
New construction 2018-2027 60% on improvements (> 60% provided for a HQ or
major employer tenant)
$3 Million above base year valuation
Not initiated N/A N/A
Denton Crossing retail New construction 2005-2019 one-third of local sales taxes generated by the
development
450,000 square feet of retail Yes $5.8 million $10.6 million
Unicorn Lake retail New construction 2010-2024 one-third of local sales taxes generated by the
development
35,000 square feet of retail Yes $392,071 $1.1 million
Rayzor Ranch retail New construction 2012-2032 one-half of local sales taxes generated by the
development
Phase I: 400,000 Sq. Ft.; Phase II: 300,000
Sq. Ft.Yes $4.3 million $6.5 million
Golden Triangle Mall retail Renovation/Redevel
opment
2016-2035 one-half of local sales taxes generated by the
development above the base year
$9.5 Million by mall owners alone; at least
$45 Million total by owners and tenants Yes $43,597 $5.1 million
Buc-ee's travel center New construction 2018-2042 one-half of local sales tax from retail and sit-down
restaurants; one-quarter of local sales tax for fast food
and service
Developer payment of $2 Million to TxDOT
for mobility improvements; Certificate of
Occupancy for travel center; DCAD
valuation of Travel Center of at least $25
million
Not initiated N/A N/A
Schlumberger oil and gas industry services Renovation/Redevel
opment
2012-2018 50% on bldg and equipment $5 million investment in renovation of
building; 80 jobs @ $45K Yes $279,817 $1.5 million
Mayday
Manufacturing
precision metalwork for
aerospace/defense
industries
Expansion 2013-2022 75% on improvements (increment above base
valuation)
$3 Million over base value
Yes $75,339 $50,409
Chapter 380 Agreements -- Sales Tax Rebate
Tax Abatement Agreements -- Property Tax
Chapter 380 Agreements -- Property Tax Rebate
Current and Future Incentive Agreement Summary
Company Industry Project Type Agreement
Term
Incentive Threshold/Requirement To Be Met To
Receive Incentive
Performing Incentive Paid thru
FY 16-17
Net Revenue
to City
West Gate Business
Park
Class A
commercial/industrial
buildings
New construction 2016-2025 70% on improvements One-time $50K grant and Bldg. 1 only, $3M
over base value
Yes $88,494
($31,348) (a
one-time grant
of $50,000 and
the ad valorem
rebate for
2016 make the
net negative)
Sally Beauty Co.direct-to-consumer retail
and professional beauty
supply (headquarters)
Expansion 2017-2019 50% on improvements (increment above base
valuation)
$28.6 Million total valuation of Sally's
Denton property; 250 jobs with an average
wage of $51,800
Not initiated N/A N/A
WinCo New construction 2017-2022 Infrastructure grant: $1M water and $860K
wastewater; construction sales & use taxes; 100% of
the tax increment of subject tract until costs of public
impr. reimbursed; City Grant 1: 60% on imprv. and
BPP/equip. until project costs paid; City Grant 2:
additional 4 years on imprv. & BPP
$50 Million DCAD valuation excluding
purchase price of the property, $850,000
for sales and use construction and FFE
taxes
Yes
$2.2 million
(infrastructure
grant and
construction sales
& use tax rebate)
WinCo will
receive all of
the TIRZ and
general fund
revenues it
generates until
they are
reimbursed for
the TIRZ Phase
1
infrastructure
The Railyard Renovation/Redevel
opment
2015-2019 $76,000 annually from Downtown TIF Fund TIRZ grant requires the commercial lease to
remain in effect, improvements in
accordance with Agreement
Yes $152,000 -10,128
Embassy Suites
Denton Convention
Center
New construction 2018-2042 100% rebate of property, hotel occupancy, and sales
taxes; 100% rebate of construction sales & use tax up
to $850,000, reduced to 50% after that
$80 Million investment and $20 Million
increase above base year valuation Not initiated N/A N/A
Chapter 380 Agreements -- Other