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Williamson County officials swing for the fence in bid to land Samsung Taylor site

Bob Sechler
Austin American-Statesman
Samsung's only U.S. manufacturing facility is in Northeast Austin. The company is planning to build a new state-of-the-art chip factory, but it is seeking publicly funded incentives for the project.

Williamson County and the city of Taylor are pulling out all the stops in hopes of landing a planned new Samsung factory — and beating out a site in Austin — by crafting a publicly funded incentive package for the project worth hundreds of millions of dollars to the South Korea-based maker of computer chips over the next few decades.

Combined with a potential property tax break from the Taylor Independent School District that's estimated at $314 million over 10 years, the overall amount of incentives being offered to Samsung if it selects Taylor as the site for its new factory is likely to easily surpass $1 billion over the life of the project.

Williamson County commissioners and members of the Taylor City Council are scheduled to discuss their proposed incentives at a specially called joint meeting Wednesday evening, although Samsung spokeswoman Michele Glaze said Tuesday that the company hasn't made a decision on where to build the manufacturing plant.

"All sites are under consideration and each community is performing the appropriate due diligence to put themselves in the best position for this opportunity," Glaze said. "The actions by Williamson County and city of Taylor are part of their due diligence."

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Samsung's investment in the next-generation semiconductor factory will total about $17 billion, the company has said, and the facility will employ 1,800 people.

Austin — where Samsung has had a big presence for nearly 25 years — has been considered a front-runner to win the new factory. It's already home to Samsung's only U.S.  manufacturing facility, and the company bought some land nearby less than a year ago to accommodate expansion.

Still, Samsung has said that a willingness to provide tax breaks will be key to its decision — a potential sticking point because an incentive deal to develop the project at the Austin site has been slow to come together.

Travis County officials previously said they wouldn't be able to complete negotiations and provide a sufficient interlude for public input in time for Samsung's target to have an agreement by mid-August. It's now several weeks past that target date, and a deal doesn't appear imminent.

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“Travis County staff is still working towards this project and trying to create a tax rebate incentive that will benefit the community and Travis County and Samsung," Travis County spokesman Hector Nieto said Tuesday.

The length of the negotiations has created an opening for Taylor — a community of about 18,000 in eastern Williamson County — as well as for other sites Samsung has said it's considering in Arizona and New York.

If Taylor is selected, the factory would be built on land Samsung has options to buy that's southwest of the city's downtown, near U.S. 79 and County Road 401. 

Taylor "is honored to be considered for this critical project and, if selected, we look forward to a long-term relationship benefiting the company and our community for generations to come," Taylor Mayor Brandt Rydell said in a prepared statement.

Samsung is considering building a new state-of-the-art semiconductor factory in Taylor, a town in eastern Williamson County with a population of about 18,000.

Under Taylor's proposed incentives — which can't be officially approved until Oct. 14 at the earliest, after public hearings are held — the city would annex the land and then provide Samsung with a 92.5% rebate on its property taxes during the first decade of the project, a 90% rebate during the second decade and an 85% rebate during the third. The city also would provide the company with expedited permitting and some other development help.

If there is no change in Taylor's property tax rate, the city rebates would total about $240 million to Samsung during the initial 10 years if they commenced in 2023, based on official estimates of the project's annual taxable value.

Williamson County, meanwhile, has proposed a 90% tax rebate for Samsung during the first 10 years, with a potential extension for another 10 years at an 85% rebate. The county rebates during the initial decade would total about $114 million, assuming the tax rate didn't change.

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It's difficult to estimate the value of the city and county rebates in later years, because future tax rates and the taxable value of Samsung's property are unknown. Regardless, the company would pay only a fraction of the property taxes that it would otherwise owe.

In exchange for the incentives, however, Taylor would land a globally prominent, high-tech employer that has the potential to be transformational for the small city. Taylor has been growing, but at a pace well below the boomtown levels of Austin and some other communities in the Austin metro area, such as Round Rock and Pflugerville.

Samsung's state-of-the-art new semiconductor fabrication plant will encompass a minimum of 6 million square feet, and the company has said initial annual wages for workers will average about $66,000.

Taylor's "historic downtown and quaint turn-of-the-century neighborhoods are testament to a glorious past, but Taylor’s future promises to be even more dynamic and exciting," said Rydell, the mayor. "We welcome businesses that are good corporate citizens, community-oriented, and committed to offering good jobs and still better opportunity."

At the Austin site for the potential new factory, Samsung has applied for a property tax break from the Manor Independent School District that is valued at $285.5 million over 10 years, according to the Texas Comptroller's Office.

In addition, documents filed with the state earlier this year pegged the value of tax breaks that Samsung intended to seek from the city of Austin at $872.5 million over 20 years, and the value that it intended to seek from Travis County at $610.5 million over 20 years — for a total value of city, county and school district tax breaks of about $1.77 billion.

None of those potential tax breaks has been approved by Travis County, the city of Austin or the Manor school district.

Samsung also has said it plans to seek incentives from the state in exchange for building its new factory at one of the two Texas sites it's considering.

Editor's note: This story has been updated to reflect the most recent estimates of the tax breaks that Samsung has sought from the city of Austin and Travis County. An earlier version relied on estimates contained in initial state documents that were later supplemented.