Some expansion and relocation projects may require significant infrastructure construction, including new roads, water and or sewer lines. The City of Richardson will consider participation at a variety of levels, from partial to full costs, depending on the project.
Richardson considers local property (ad valorem) tax abatements for companies on a case by case basis. By state law, existing property taxes cannot be abated: only new construction (facilities not land) and Business Personal Property (fixed assets such as equipment, machinery/computers) added as the result of business relocation or expansion can be considered for tax abatements.
State law also limits abatements to an annual percentage of not more than 100% and to a term of not more than 10 years. City of Richardson typical abatements range from 25% to 50% for a period of 5 to 10 years.
By statute, the city will initiate abatements and set the percentage and term. County or community college districts may elect to participate in the abatement (generally only for what would be considered a major project ~$15M+) and set their % and duration or they may decline to participate.
Under current state law, school districts which make up over 60% of property taxes, do not participate in tax abatements.
Fees paid to the City for building permits and certificate of occupancy may be waived.
No Impact Fees
Impact fees are collected by some DFW area cities to compensate for anticipated infrastructure costs arising from a new development. The City of Richardson does not assess impact fees.
Tax Exempt Financing
Tax exempt financing is made available through the Richardson Industrial Development Corporation.
The federal tax-free debt carries a lower interest rate.
Project must be primarily manufacturing
$10 million bond debt maximum
For financings under $1 million, additional underwriting fees generally equal or exceed the interest cost savings.
“Freeport goods" are defined as those which are warehoused in Texas for less than 180 days and then shipped outside the state. A "Freeport" exemption may exempt some or all of a company’s inventory (raw materials through finished goods) from local property taxes.
All tax jurisdictions have the option of granting the "Freeport" Exemption. Once granted, the exemption is irrevocable and applies to all businesses within the jurisdiction. When a city, the local school district and the county all grant the exemption, it's called “Triple Freeport”. In Texas, school districts account for nearly 60% of the total property tax bill and therefore, a location with a participating school district can offer a large manufacturing a significant financial advantage. The amount of savings depends on if the site is in Dallas County/Richardson ISD portion or in the Collin County/Plano ISD portion of the City of Richardson.