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If your company locates in the New Braunfels Enterprise Zone and qualifies as an Enterprise Project, you could qualify for up to $2,500 per job in sales tax refunds for qualified equipment purchases & building construction. Both local and state sales tax would be utilized in the calculations. 

FRANCHISE TAX DEDUCTION

As an Enterprise project in New Braunfels, your company could be eligible to deduct from its taxable capital 50% of its capital investment.The deduction may be taken on each franchise tax report based on your fiscal year. 

After apportionment, deductions from both capital and earned surplus are allowed for enterprise zone investments.The state tax rate on capital assets is $2.50 per $1,000 of taxable capital and the earned surplus tax rate is 4.5%.Specifically, enterprise zone projects are eligible for a deduction from taxable capital that equals to 50% of the project's capital investment in the enterprise zone.The allowable deduction from taxable earned surplus is 5% of the qualified investment. 

SCHOOL PROPERTY TAX REFUNDS

In 2001 during the 77th Legislative session House Bill 1200 sponsored by Congressman Brimer provided relief from school property taxes for large capital investments.The law applies only to a corporation or limited liability company that is subject to payment of state franchise taxes.In addition the company must create at least twenty-five new permanent jobs, pay at least 80% of a group health benefit plan for its employees and pay at least 110% of the county average weekly wage.

INDUSTRIAL DEVELOPMENT BOND FINANCING

Governed by the Texas Development Corporation Act of 1979, political subdivisions are authorized to create non-profit lending corporations to provide tax exempt financing for commercial, industrial and manufacturing projects.

The Comal County Industrial Development Authority acts as issuer for tax-exempt industrial revenue bonds.A number of projects have been approved and bonds sold to finance projects in New Braunfels. 

NEW BRAUNFELS UTILITIES IMPACT FEE WAIVER POLICY

In order to promote industrial development and economic growth in New Braunfels and its surrounding area, New Braunfels Utilities has formulated an Impact Fee Waiver Policy.The waiver shall be available to manufacturers and service industries which own qualifying real and personal property and are willing to execute a contract with New Braunfels Utilities for the waiver of impact fees designed to promote long-term significant positive economic impact to the community. 

A manufacturer or service industry requesting a waiver must apply for water or sewer service and agree to expend a designated sum of money or provide a certain number of jobs according to the scoring formula in use by the City of New Braunfels and Comal County for property tax abatement.

ECONOMIC DEVELOPMENT CORPORATION FINANCING

The City of New Braunfels has a sales tax for economic development.A corporation has been established by the City Council. They will be able to consider the following for qualified projects:

Business Development:  Direct Loans, Guarantees, Interest Subsidies, Grants, Relocation and Moving Expenses, Subsidized Land & Building costs, Equipment purchases, GAP financing.

Facility Development:  Building construction, Existing Building expansion and upgrades, Industrial Land Development.

Infrastructure Development:  Utility Extensions to Industry, Utility Development to key industrial areas,Infrastructure upgrade, rail spurs for industry.

Workforce Development:  Job Training Costs, Equipment for Training Programs, coord. with ISDS, supplement Skills Development Fund grants, Technical/Vocational center.

TAX ABATEMENTS 

The City of New Braunfels is committed to the promotion of high quality development in all parts of the City and to an ongoing improvement in the quality of life for its citizens. Insofar as these objectives are generally served by the enhancement and expansion of the local economy, the City of New Braunfels will, on a case-by-case basis, give consideration to providing tax abatement and other incentives as stimulation for economic development in New Braunfels.It is policy of the City of New Braunfels that said consideration will be provided in accordance with the guidelines and criteria outlined in this document.Nothing herein shall imply or suggest that the City of New Braunfels is under any obligation to provide tax abatement to any applicant. All applicants shall be considered on a case-by-case basis, and the decision to approve or deny tax abatement shall be at the discretion of the City Council.Tax abatement agreements are made with the owners of real property to exempt from taxation a portion of the value of the real property or of tangible personal property, or both.The duration of an agreement may be for a period of time determined appropriate by the City Council, based on the economic life of the improvements and consistent with the provisions of this policy, but in no case for more than ten years in accordance with state law.Special terms and conditions may be set in the agreement governing each specific tax abatement.

Eligibility & Criteria

A. Eligible Facilities:Tax abatement may be granted for new facilities and for expansion or modernization of existing facilities. The economic life of a facility, and/or eligible property must exceed the duration ofthe abatement.

B. Eligible Property: Tax Abatement may be applied to both real and business personal property.Inventory and supplies are not eligible for tax abatement.

C. Eligibility Criteria: In order to be considered for tax abatement, the project must be located within one of the following categories and be a targeted industry type as shown in # 4 below:

1. Citywide: Eligible facilities located in a reinvestment zone and resulting in a minimum added value of $200,000 in real and business personal property (excluding inventory and supplies.

2. New Braunfels Enterprise Zone: Eligible facilities located in the New Braunfels Enterprise Zone resulting in a minimum added value of $100,000 in real and business property (excluding inventory and supplies).

3. Downtown New Braunfels: Eligible facilities located in downtown New Braunfels, which includes the Downtown Zoning District, resulting in a minimum added value of $50,000 in real and business personal property (excluding inventory and supplies).

4. Target Industry Type: 

(a) A project is considered to be a Target Industry Type if it fits within the economic development strategic plan, and shall be eligible for tax abatement only upon a finding by the City Council that the project will make a unique or unequalled contributionto the economy, development, redevelopment, tourism or employment opportunities in the City of New Braunfels.  Targeted industry categories are:

Targeted Categories
-  Product Fabrication
-  Assembly & Processing - Electronic, Aircraft, Bio-medical & Consumer Products
-  Distribution/Warehouse
-  Headquarters - Corporate/Regional - all categories
-  Business Services - Financial, Personnel, Industrial, Educational, Aviation-related, 
      Communications and Computer-oriented services
-  Research & Development
-  Aviation-related Industries
-  Technical-Related Education & Training

The above categories to include the following:
-  Commercial Machinery
-  Electrical & Electrical Machinery
-  Electronic Computers
-  Equipment
-  Fabricated Metals, Plastics & Wood
-  Food & Kindred Products
-  Furniture Fixtures
-  Instruments & Computer Related Devices
-  Miscellaneous Manufacturing Industries
-  Micellaneous Plastic Products
-  Parts of the Lumber & Wood Products
-  Parts of the Paper & Allied Products Category
-  Printing, Publishing & Allied Industries
-  Parts of the Paper & Allied Products Category
-  Stone & Concrete Products
-  Telecommunications
-  Transportation Equipment

Non-Targeted Categories:
1.  Those industries with processes requiring excessive use of environmentally unsafe material or those that produce air emission or waste that would be detrimental to the community's environment.

2.  Those industries that over duplicate the types of industry already existing in the community or those not compatible with the labor force or its availability.

The above statements concerning the following:

Non-Targeted Categories:
-  Chemicals & Allied Products
-  Petroleum Refining & Related Industries
-  Primary Metal Industries
-  Parts of the Lumber & Wood Products Category
-  Parts of Paper & Allied Products
-  Plus,     Metal Products
                Fur Goods
                Leather Tannin & Finishing
                Shell Products
                Abrasive, Asbestos & Misc. Non-metallic Mineral Products
                Ordinance & Accessories
                Jewelry, Silverware & Plated Ware
                Hazardous Waste Disposal
 

Criteria and Value of Abatement Tax abatement may be granted for eligible targeted industry types on all or a portion of the increased taxable value of eligible property over the base year value according to the following:

1. Tax abatement of up to 20% will be considered for a project meeting or exceeding the minimum added value requirements. A tax abatement of up to 40% will be considered for a high impact project resulting in a minimum added value as described in Exhibit B below.  In no event will a tax abatement granted under this section alone commence until the increased taxable value of eligible property meets or exceeds the minimum added value requirement as specified in the agreement.

2. A tax abatement of up to 60% on a high impact project will be considered for a project granted tax abatement if the project will be considered for a granted tax abatement if the project creates or retains one hundred (100) or more "qualified" jobs citywide, fifty (50) or more jobs in the Enterprise Zone, or ten (10) or more jobs in the Downtown District. In no event will this bonus apply in any year of the agreement that the project does not create or retain the minimum number of jobs specified in the tax abatement agreement, which may require the creation and/or retention of more than the minimum number of jobs used to determine eligibility.

3. A tax abatement of up to 80% on a high impact project will be considered if the project meets the communities economic development strategic plan objectives, makes contributions to the public infrastructure of the city, contributes sales and/or room taxes, and minimizes investment by the taxing authorities in order to serve the project.

4. The maximum percentage of tax abatement granted in accordance with this policy statement shall not exceed 80% per agreement.

5. Exhibit B:  Suggested scoring formula:

EXHIBIT B

Suggested Scoring Formula

One (1) point is scored for each $100,000 increase in value in real and personal property included in project (rounded to nearest $100,000).

One (1) point is scored for each ten (10) permanent full-time qualified employees compensated to equal the most recent published covered employment average county wage hired within twelve months of project completion.  Qualified employees are those receiving access to benefits via the employer, i.e. medical, vacation, etc. and work not less than 2000 hours per year.

One (1) point is scored for each ten (10) qualified jobs paying 25% above the most recent published employment average county wage hired within twelve (12) months of project completion.

One (1) point is scored for each ten (10) qualified jobs paying 50% above the most recent published covered employment average county wage hired within twelve (12) months of project completion.

One (1) point is scored for each $50,000 invested by the company in worker training within the first twelve (12) months of the project.

Only that increase in the fair market value of the real property directly resultant from the development, re-development and improvement specified in the contract will be eligible for a tax abatement and then only to the extent that such increase exceeds any reduction in the fair market value of other real property of an owner located within the jurisdiction creating the reinvestment zone.  The length of the tax abatement contract will, as indicated above, begin with the successful completion of the development, redevelopment or improvement of the project.
 

Employment Requirements:

1. Full-time position, i.e., 35 hours per week with company subsidized benefits, will be considered as one (1) new job.

2. Two part-time position, i.e., 25 hours per week with company subsidized benefits, will be considered as one (1) new job. 

3. No temporary positions will be considered as full-time positions for tax abatement purposes.A 90-day transfer period will be allowed for temporary positions to be converted into permanent jobs. 

4. All positions must include company-subsidized benefits.The benefit package must include medical coverage where the company pays the majority of the employee's cost.Medical benefits must be accessible to the employee's dependents. The benefit package must also include holiday, vacation and sick pay. 

5. Qualified employees is defined as compensated to at least equaling or exceeding the most recent published covered employment average county wage.


WORKFORCE TRAINING

The community established the Central Texas Technology Center in 2005 to further meet the needs of local employers.  The campus, operated by the Alamo Community College District (ACCD), specializes in technical skills training.  The campus is owned by the City of New Braunfels and offers a wide range of academic, technical, and continuing education programs to include Associates Degrees.  The CTTC is the regional workforce development center for New Braunfels, Seguin, and the regional area.

QUALITY OF LIFE PROJECTS:

The following quality of life projects may also qualify for tax abatement: recreational parks, amusement parks, indoor and outdoor sporting areas, golf complex, sports complex or stadium type facility for spectator sports and entertainment.  The proposed capital investment will be figured on the scoring formula in Exhibit B above.  Capital investment: A quality of life project must have a minimum capital investment of $500,000 to qualify for tax abatement.

Projects that are qualified as a quality of life project will not need to meet any of the job requirements.The abatement percentage will be determined by the project's level of investment only. 

The maximum length of abatement for quality of life project is five years. "Quality of Life" facility means building and structures, including fixed machinery and equipment, used or to be used in providing amusement and/or entertainment through the paid admission of the general public. A  facility cannot restrict admission because of age.

ECONOMIC DEVELOPMENT ASSISTANCE

The Greater New Braunfels Chamber of Commerce, Inc. via professional services agreements with the City and local economic development foundation is responsible for recruiting and retaining business and industry in New Braunfels and its environs.

The professional staff of the Chamber of Commerce has the capabilities and resources to assist prospective new companies in all phases of site selection.Assisting existing businesses and industries is a high priority. 

The community is committed to quality development in all parts of the area and has established numerous economic development programs designed to enhance our business climate. 

The following economic programs are offered to assist interested business and industries in their expansion or relocation:

• Tax Abatement and other Economic Development Incentives
• Reinvestment Zone Designation
• Industrial Development Bond Financing
• Development Grants
• Freeport Exemption  -  The City of New Braunfels, Comal County and the Comal ISD allow personal property tax exemptions for companies that deal with goods-in-transit or inventories used in the manufacturing process.  Freeport property qualifies for an exemption from ad valorem taxation only if it has been detained in the state for 175 days or less for the purpose of assembly, storage, manufacturing, processing, or fabricating.
  
   

BUSINESS SERVICES INCLUDE:

Texas Enterprise Zone Program:

The purpose of the Texas Enterprise Zone Program is to encourage job creation and capital investment in areas of economic distress by providing communities with an economic development tool through which they can offer state and local incentives and program priority to new or expanding business located in these designated areas.
 

Alamo WorkSource Development: 

Alamo WorkSource Development (AWD) serves as the leadership and governing board for the regeional workforce development system.  The mission of AWD is to ensure that the workforce system and human development services it provides makes the region's employers and residents more competitive in the global economy.

Texas Leverage Fund:

The Texas Leverage Fund (TLF) is an "economic development bank" offering an added source of financing to communities that have passed the economic development sales tax.This program allows the community to make loans to local businesses for expansion or to recruit new industries. 

State of Texas Industrial Revenue Bond Program:

The State of Texas Industrial Revenue Bond Program is designed to provide tax-exempt financing to finance land and depreciable property for eligible industrial or manufacturing projects.The Development Corporation Act allows cities, counties, conservation and reclamation districts to form non-profit industrial development corporations or authorities on their behalf.The purpose is to issue taxable and tax-exempt bonds for eligible projects in their jurisdictions. 

Texas Linked Deposit Program:

The State of Texas Linked Deposit Program ("Linked Deposit Program") was established to encourage lending to historically underutilized businesses, child-care providers, non-profit corporations, and/or small businesses located in an Enterprise Zone by providing lenders and borrowers a lower cost of capital. 

For further information or assistance, please contact:

Office of Economic Development and Tourism
(OEDT)
1700 N. Congress Ave.
SFA Bldg, Suite 130
Austin, TX 78711

E-Mail: finance@TDED.state.tx.us
Internet: http://www.txed.state.tx.us

Phone: 512/936-0223
FAX: 512/936-0193
Relay Texas: 800/888-0511