From
Letecia McClendon
Title
Resolution granting 380 Incentive Agreement with Haier US Appliances Solutions, LLC d/b/a GE Appliances granting a 50% rebate on business personal property for nine years
Presenter
Marty Wieder, Economic Development Director
Recommended Action
Approve
Analysis
Haier US Appliances Solutions, LLC (doing business as GE Appliances, headquartered in Louisville, Kentucky), has operated at 1011 Isuzu Parkway in Grand Prairie for more than 17 years. They warehouse and distribute more than $29 million in GE Appliances across the Southwest U.S. out of this 470,000 square foot, rail-served facility.
GE's business has evolved and grown to the point that to continue to facilitate future operations, the company must make a change. GE is therefore pursuing a long term lease of 700,000+ square feet, to be constructed and developed according to their cross dock specifications. GE has considered numerous locations with various developers, narrowing their list down to two sites (Grand Prairie and Wilmer).
GE appliance executives communicated to Economic Development that there are significant financial considerations complicating this decision that have led them to apply for incentives. However they have also said that if Grand Prairie grants the incentives as requested, it will position GE to continue to make Grand Prairie their business home for several years to come.
Thus as an incentive for GE to expand its operations and remain in Grand Prairie, staff is recommending Council consideration of a nine-year, 50% property tax rebate on their business personal property.
This agreement was reviewed by the Finance and Government Committee on June 6, 2017.
Financial Consideration
Projected Investment - Added Real Estate Improvements: $22,000,000
Projected Investment - Business Personal Property: $29,000,000
Projected Added Investment - Business Personal Property: $1,000,000 per year (for 10 years)
Projected - Business Personal Property Rebate: $68,000 per year ($612,000 over 9 years)
Body
A RESOLUTION OF THE CITY OF GRAND PRAIRIE, TEXAS, TO ENTER INTO A 380 PROGRAM AGREEMENT FOR ECONOMIC DEVELOPMENT INCENTIVES WITH HAIER US APPLIANCE SOLUTIONS, INC. D/B/A GE APPLIANCES GRANTING A REBATE
Whereas, Haier US Appliances Solutions, LLC d/b/a GE Appliances is considering a long-term lease in a new 700,000+ S.F. facility to be developed and constructed according to their specifications in Grand Prairie; and
Whereas, the new expansion facility will add an additional $22,000,00 in new ad valorem real estate improvements, and will retain over $29,000,000 in business personal property in Grand Prairie; and
Whereas, a nine-year, 50% property tax rebate on the business personal property will induce Haier US Appliances Solutions, LLC d/b/a GE Appliances to expand its warehouse/distribution operations and remain in Grand Prairie for an additional 10 years; and
Whereas, the City Council has determined that it is in the public interest to enter into a Chapter 380 Program Agreement for Economic Development Incentives and partially rebate certain business personal property taxes.
NOW THEREFORE, BE IT RESOLVED, by the City Council of the City of GRAND PRAIRIE, Texas that:
Section 1. THAT the granting of an incentive through a Chapter 380 incentive agreement is approved and the City Manager is hereby authorized to execute contracts to effectuate this approval.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF GRAND PRAIRIE, TEXAS, ON THIS THE 6TH DAY OF JUNE, 2017.