Schedule I

Schedule II

TX Enterprise Zone

Property Tax 9.105

Property Tax Rule 9.105  The Texas Comptroller of Public Accounts offers a refund of franchise and sales/use taxes paid by companies owning certain abated property.  A company who meets the following three conditions may apply for a refund:

• Paid property taxes to a school district on property located in a reinvetment zone. 
• Is exempt in whole or in part from property tax imposed by a city or county under a tax abatement agreement.
• Is not in a tax abatement agreement with a school district.

Tx Economic Development Act (HB1200)

Texas Economic Development Act (HB 1200)  This act provides relief from school district property taxes for companies making large capital investments of $20 million to $100 million or greater.  The appraised value of qualifying capital investments is capped based on a sliding scaled tied to the total property wealth of the school district where the investment is located.  The investment amount is determined over a 2-year period.   In general, a school district may abate 100% of the appraised value over the applicable cap of improvements and tangible personal property used in manufacturing for up to 8 years, beginning in the third year of investment.  The company will pay taxes based on the full-appraised value during the first two years but is entitled to a refund of any amounts paid during that period on the value in excess of the applicable cap.  In addition the company must create at least 25 new permanent jobs, pay at least 80% of a group health benefit plan for its employees, and pay at least 100% of the county average weekly wage.

Foreign Trade Sub-Zone

The U.S. Department of Commerce recently approved the modification of Gregg County’s Foreign Trade Zone to provide a new benefit for businesses. The new designation, the Alternate Site Designation, is the first of its kind in the nation and will allow companies located within Gregg County to secure Foreign Trade Zone status for warehousing and distribution operation within approximately 30 days, faster than the usual timeframe. Manufacturing companies benefit from the streamlined procedures as well. 

Freeport Tax Exemption

Pollution Control Equipment Exemptions

Utility Tax Exemptions

Natural Gas and Electricity Sales and Use Tax Exemption  Companies are exempt from paying state sales and use tax on electricity and natural gas used in manufacturing, processing, or fabricating tangible personal property.  The company must complete a predominate use study showing that at least 50% of the electricity or natural gas consumed by the business directly causes a physical change to a product.

MM&E Tax Exemptions

Clean Room Exemptions

Texas Enterprise Fund

Emerging Technology Program

ED Sales Tax Incentives

The Kilgore Economic Development Corporation (KEDC) was created by the voters in 1990 to use the revenue generated by a ½ cent sales tax for economic development to encourage the creation and retention of jobs and capital investment in Kilgore. The KEDC Board of Directors works with interested parties for the use of these funds as an incentive to locate or expand in Kilgore.  The amount and type of the incentive depends upon the economic impact of the project and the specific needs of the company.  Incentive funds can be applied to costs associated with land or facility acquisition, facility construction, remodeling, infrastructure, training programs, etc., according to the terms of an economic development performance agreement between KEDC and the company. 

Texas Capital Fund

Designed to promote growth in non-entitlement areas, the Texas Capital Fund can be used for businesses creating new full-time jobs, a majority of which benefit low to moderate-income persons.  This program requires an application and competitive rating process which sometimes delays the funding process.  If the timing of the project makes it possible, the TCF programs available to Kilgore are:

TCF Infrastructure Grant Program

 Funds may be used for construction and/or improvements of water or wastewater facilities, public road construction, natural gas line services, rail spurs, and electric power services.  Minimum and maximum awards are $50,000 and $750,000 and may not exceed 50% of the total project cost.

TCF Real Estate Development Program

Funds may be used to acquire, construct, or rehabilitate real estate to support a for-profit or a non-profit entity willing to commit to creating or retaining jobs primarily for low or moderate income persons.  Minimum and maximum awards are $50,000 and $750,000 and may not exceed 50% of the total project cost.

Funds may be used for:

       acquisition of land and/or buildings

       construction of new buildings and site improvements

       rehabilitation of buildings and site improvements

Terms 
The minimum award is $50,000 and the maximum is $1,000,000 inclusive of administration costs. Awards of more than $750,000 require a greater level of job creation/retention and matching funds, and are limited to two (2) per year.  The award may not exceed fifty percent (50%) of the total project cost. Required minimum equity injection of the total project cost by the business:

       ten (10%), if operating for 3+ years

       thirty-three percent (33%), if operating for less than 3 years

Applicant must not sell/transfer ownership for a minimum of five years.

The business must remit to the applicant a monthly lease payment equal to the award amount divided over a maximum 240 month period.

Applicant may elect to deposit lease payments in a revolving loan fund for use at the local level and receive one award per program year; or return payments to the state for use in a state revolving loan fund, which allows the applicant to be eligible for as many awards per program year as it has eligible projects.

The lease agreement with the business must be for at least three years or until the contract between the applicant and the Texas Department of Agriculture is satisfactorily closed.

Collateral
An applicant may use the real estate as collateral to secure additional funding for the real estate improvements.

Chapter 380 Incentives

The City may offer a range of incentives designed to promote local economic development.  These incentives are normally negotiated between the company and the City but can include reimbursement of certain expenses. Chapter 380 agreements are often offered in lieu of tax abatement.

Tax Increment Financing

The City can designate a reinvestment zone to provide tax increment financing of project costs for public works or public improvements in the zone. Tax increment bonds or notes may be used to pay project costs. The proceeds from taxes on improvements within the zone are used to pay the debt service on the bonds or notes or for the cost of the project for a designated time as determined by a TIF plan adopted by the taxing entities participating. School districts are prohibited from participating in TIFs. The TIF can be used to finance improvements required by a project in order to locate in the City of Kilgore.

Industrial Revenue Bonds

KEDC may issue tax-exempt bonds to finance land and depreciable property for manufacturing facilities. The maximum bond amount is $10,000,000 for tax-exempt issues, and the maturity of the bonds may extend to the lesser of 40 years or 120 percent of the depreciable life of the assets being financed. Eligible project costs include the acquisition by a business of an existing facility, acquisition of land, construction of new facilities, machinery, tools, equipment, and a limited amount of the bond issuance costs. The bonds are subject to the state’s private activity bond volume cap administered by the Texas Bond Review Board.

NETEDD Revolving Loan Fund

Chapman Revolving Loan Fund

SBA 504 Loan Program

Small Business Administration 504 Loan Program is a direct-lending program providing long-term financing for fixed assets at a fixed rate of interest at or below New York prime rate. Designed to create and retain full-time jobs and to help businesses start-up or expand, the loan usually includes a senior lien from a private-sector lender covering 50% of the project cost and at least 10% equity injection. Generally the business must create or retain one job for every $35,000 provided by the SBA. The maximum loan is $1,000,000 for job creation. Companies located in Kilgore have access to the program through the East Texas Regional Certified Development Company.

SBA 7a Loan Program

Economic Development Administration

TX Capital Access Program

The program is designed to increase the availability of financing for businesses and non-profit organizations that face barriers in accessing capital.  Eligible borrowers can be any small business with less than 500 employees or a non-profit corporation.  The proceeds may be used for working capital or the purchase, construction, or lease of capital assets including land, buildings, and equipment.

Linked Deposit Program

Agricultural Business Programs

Industry Development Loan Program

The Texas Industry Development (TID) Loan Program provides capital to Texas communities at favorable market rates. The main objective of TID is to support projects that will stimulate the creation of jobs. TID loans can be used for a variety of purposes including community infrastructure development. TID financing is available for loans above $5,000,000.

The TID program operates within a non-profit corporation under the Development Corporation Act of 1979 (Vernon's Texas Civil Statutes Article 5190.6), Texas Small Business Industrial Development Corporation (TSBIDC). The 67th Legislature in 1981 authorized TSBIDC to issue bonds for economic development projects and is administered by the Office of the Governor.

Product Development Fund

The Texas Product Development Fund provides financing to aid in the development, production and commercialization of new or improved products within the state. Products appropriate for the Fund are inventions, devices, techniques, or processes that have advanced beyond the theoretical stage and are ready for immediate commercial application.

Small Business Fund

The Texas Small Business Fund provides financing to foster and stimulate the development of small businesses in Texas. Preference for funding will be given to the state’s defined industry clusters within emerging technology fields including semiconductors; nanotechnology; biotechnology and biomedicine; renewable energy; agriculture and aerospace.

Skills Development Fund

Kilgore College Workforce Development

 The Workforce Development Department at Kilgore College works with business and industry to design customized training to match the needs of a specific company.  The college will work with business to access any training funds available for the project (such as Skills Development Fund), write the application for those funds and handle the administrative requirements of the grant. The college can provide pre-employment testing and screening. KC also offers certificate and degree programs in a variety of fields and technical areas.  Every program created by Kilgore College Workforce Development is a unique customized response to each company’s specific needs.  KC Workforce Development’s customer-directed, industry-driven approach provides a business with affordable solutions for skills training.  For more information, contact Martha Woodruff, Director of Workforce Development, at 903-983-8287.

Local Workforce Development

Local boards oversee training funds for specific regions and have some programs available for training certain qualified populations.

Texas State Technical College

Located 35 miles from Kilgore, TSTC works with industry in a number of ways, including the following:

• Provide customized training programs, incorporating the employers’ goals and objectives
• Offer technical training through certificate and degree programs
• Handle administrative aspects of the Skills Development Fund
• Contact:  903-935-1010, Ext. 2250

Economic Development Sales Tax Incentives

The Kilgore Economic Development Corporation funds can be applied to costs associated with training needs according to the terms of a negotiated economic development agreement between KEDC and the company and according to the requirements in state law in lieu of or in addition to other KEDC grants.

Industrial Revenue Bonds

KEDC may issue tax-exempt bonds to finance land and depreciable property for manufacturing facilities. The maximum bond amount is $10,000,000 for tax-exempt issues, and the maturity of the bonds may extend to the lesser of 40 years or 120 percent of the depreciable life of the assets being financed. Eligible project costs include the acquisition by a business of an existing facility, acquisition of land, construction of new facilities, machinery, tools, equipment, and a limited amount of the bond issuance costs. The bonds are subject to the state’s private activity bond volume cap administered by the Texas Bond Review Board.

NETEDD Revolving Loan Fund

SBA 504 Loan Program

Small Business Administration 504 Loan Program is a direct-lending program providing long-term financing for fixed assets at a fixed rate of interest at or below New York prime rate. Designed to create and retain full-time jobs and to help businesses start-up or expand, the loan usually includes a senior lien from a private-sector lender covering 50% of the project cost and at least 10% equity injection. Generally the business must create or retain one job for every $35,000 provided by the SBA. The maximum loan is $1,000,000 for job creation. Companies located in Kilgore have access to the program through the East Texas Regional Certified Development Company.

SBA 7a Loan Program

TX Capital Access Program

The program is designed to increase the availability of financing for businesses and non-profit organizations that face barriers in accessing capital.  Eligible borrowers can be any small business with less than 500 employees or a non-profit corporation.  The proceeds may be used for working capital or the purchase, construction, or lease of capital assets including land, buildings, and equipment.

Linked Deposit Program

Agricultural Business Programs

Industry Development Loan Program

The Texas Industry Development (TID) Loan Program provides capital to Texas communities at favorable market rates. The main objective of TID is to support projects that will stimulate the creation of jobs. TID loans can be used for a variety of purposes including community infrastructure development. TID financing is available for loans above $5,000,000.

The TID program operates within a non-profit corporation under the Development Corporation Act of 1979 (Vernon's Texas Civil Statutes Article 5190.6), Texas Small Business Industrial Development Corporation (TSBIDC). The 67th Legislature in 1981 authorized TSBIDC to issue bonds for economic development projects and is administered by the Office of the Governor.

Leverage Fund

Introduced in 1992, the Texas Leverage Fund (TLF) provides an additional source of financing to communities that have adopted an economic development sales tax. Communities may leverage future sales tax revenues to support job retention or creation.

Terms

Available for interim, long-term or gap financing, TLF loans provide flexible financing terms to match the unique needs of communities, with maturities of up to 15 years available. Generally, EDCs are eligible to borrow four to five times annual sales tax revenues, up to $5 million. TLF loans are low-cost, providing capital to communities at floating Prime Rate, as published in the Wall Street Journal.

Future sales tax revenues serve as collateral for loan repayment with required debt service coverage ratios specified in the Texas Leverage Fund Program Guidelines. Pledged tax collections not needed for actual debt service are available for other projects.
 

Texas Product/Business Fund

Capital loans for product commercialization and businesses
The Texas Product/Business Fund provides asset back financing to companies currently doing business in the state.  Financing is done in the form of direct asset based loans with a variable interest rate tied to London Interbank Offered Rate (LIBOR).  Loans can be amortized up to the life of the asset.  Texas companies or out-of-state/international companies doing business in the state are eligible to apply.  Applicants can submit a free brief pre-assessment in order to check eligibility.

Attributes of the Texas Product Fund:
• Asset Based Loans
• Competitive Loan-To-Value (LTV)
• Positive EBITDA not required
• Secure Loans with Property Plant & Equipment (PP&E)
 

The Office of the Governor, Texas Economic Development Bank administers the Texas Product Fund at the direction of the Governor’s appointed nine member board.  Preference for funding is given to the states’ defined industry clusters including, but not limited to: nanotechnology, biotechnology, biomedicine, renewable-energy, agriculture, and aerospace.  Job creation and retention within Texas will be considered within funding priorities.  For more information e-mail TexasProductFund@governor.state.tx.us