County another step closer to new company
On Monday, Oct. 25, the Milam County Commissioners Court took another historic step forward to land the American Statesman Glove Company in Milam County.
By a unanimous vote the Court approved a reasonable tax abatement for the company that will provide a 70 percent abatement over the next 10 years. The abatement is a key provision in the Company’s equity financing for the project. Clearly, investors want a tax abatement before investing in the project.
Tax abatements for new businesses are specifically provided for in the Tax Code and almost all new businesses are granted a tax abatement. For example, the Samsung project was awarded a 92.5 percent abatement for its $17 billion investment. All new companies vie for the best tax abatements for the obvious reasons. Tax abatements give new businesses a financial “break” in the early years to get the business started. The early years are financially the hardest for any new company.
Here, the new jobs and investment will pay the taxes back in spades. If the glove company comes to Milam County, it plans to make a $775 million investment in the County. Thus, eventually the County will receive tax revenue on $775 million.
It also plans to employ about 1,500 people with start out pay at $20 per hour and it will also pay handsome fringe benefits. This will bring individual investment in the County in terms of houses, good and services. It will also increase sales tax revenue for all taxing entities in the county.
The agreement also provides that local contractors will be given every opportunity to perform the construction work on the project. As with the bitcoin miners local contractors will be given priority to clear the land, construct the massive buildings and build the other necessary infrastructure. The Company has agreed to hire locally and is now working with Temple College, Texas Workforce Solutions and the County to develop the necessary training.
Mr. Bill Hart, the CEO of American Statesman Glove Company made a promising presentation at Commissioners to update the Court on the Company’s progress. The future is bright for this new company. While no decision has been made as to where the company will land, our guess is that the tax abatement gives the county a distinct advantage. If we are selected, it will be a huge financial step for everyone in this County. There can be no doubt that the Commissioners Court wants the company to come to the County and we have and will continue to work hard to make that happen!