Commissioners accept annual review of Smith County Tax Abatement Agreement

A report from the Smith County tax abatement committee on Tuesday showed six projects started by the county created over 2,300 jobs, including more than 700 retained, within roughly seven months.

During the Smith County Commissioners Court meeting, the commissioners accepted the 2021 annual review of the Smith County tax abatement agreement.

Dr. Felecia Herndon of the abatement committee reported that after reviewing the status of current Smith County initiated projects, the committee found that 2,366 jobs were created, and 719 jobs were retained since Dec. 31, 2020.

Over $340 million has been invested in improvements at area companies.

The six county-initiated projects reviewed were Dragline Service Specialties, GG Distributing, Jasper Ventures warehouse facility, John Soules Foods, Sanderson Farms processing plant and Wastequip.

Herndon added Smith County is also participating in seven additional projects started by the city of Tyler, Whitehouse and Lindale. These projects are Estes McClure & Associates, Fresenius Medical Care, Hiland Dairy, Homeland Title, Jasper Ventures office facility and Sanderson Farms hatchery.

Six companies were in compliance with all terms. A 100% tax abatement was recommended for two companies — Estes McClure & Associates and John Soules Foods, and an 80% abatement was recommended for GG Distributing, Sanderson Farms and Wastequip under their agreements.

Herndon reported six companies were not in compliance with terms. These companies were recommended for abatement based on the percentage of the required jobs compared to the actual amount of jobs brought in.

“While these companies are meeting their investment goals, they are not currently meeting their jobs goals,” Herndon said.

Dragline Services received a tax abatement of 66%. They were required to report 74 jobs but only reported 49.

“The main focus of Dragline Services is Caterpillar Mining Products distribution to service the mining industry which has been in decline. COVID-19 forced the company to put a freeze on hiring last year,” Herndon said.

Fresenius Medical Care received a 77% tax abatement for 2021. They were required to report 345 jobs but only reported 267.

“The company attributed its lower employment in 2021 to COVID. They are planning to add 100 new employees by the end of the year,” Herndon said.

Hiland Dairy received an 86% tax abatement for 2021, not complying with the requirement of providing 114 new jobs, but only reported 98.

“Hiland experienced some delays early on in their project but the company reports that they are now back on track to meet their job goals,” Herndon said.

Homeland Title received a 95% tax abatement for 2021. They were required to report 40 employees and reported 38.

“Homeland’s project was slightly delayed due to minor permitting issues and rain,” Herndon said.

Jasper Ventures received a 46% abatement for 2021. They were required to report 209 jobs but only reported 97.

“Jasper is suffering from a decline in the oil and gas industry and that was further compounded by COVID-19 as they were forced to cease operations and lost half of its workforce. At this time in 2019, they had 213 employees, so they’re down to 97,” she said.

Herndon said Jasper Ventures is looking at additional contracts and hopes to begin the process to slowly rebuild their business and begin hiring.

Commissioners said that after hearing the reports, they do want to reduce taxes for these companies, because the noncompliance may not be the company’s fault.

“We’ve been doing this a long time, and this is the first time that I can remember that this number of companies were adversely affected and not able to meet their goals, by large, these companies do well. They understand that there’s a compliance component,” Herndon said. “While these companies struggled in terms of their employment, they are all hitting their mark in their investment goals, they’re actually exceeding the investment that they made.”

Smith County Judge Nathaniel Moran said economic development assists the community in various ways, and in an effort to be good economic development partners, commissioners hope to see a dramatic increase in businesses next year.

Other actions

Commissioners also approved the motion to amend the Smith County Employee Handbook and employee leave policy to authorize paid quarantine leave for possible COVID-19 exposure while on duty for peace officers, detention officers, and emergency medical technicians in accordance with Texas House Bill 2073.

The court approved a lease renewal between Brookshire Grocery Co. and Smith County for 13157 U.S. Highway 271 North in Tyler, which will last until August 2022. Fees associated with the lease renewal are funded by a grant from the governor’s office.

Commissioners also listened to a workshop discussion regarding the pretrial department and veteran services department to better understand the departments, including operations, needs, challenges and areas for improvement.