City works to grant tax relief to steel plant
Posted on 2/28/2018 8:35:00 AM.
(Seguin) -- The city of Seguin is working to help provide a little bit of tax relief for a large local employer. The Seguin City Council Tuesday approved the city's participation in the Texas Enterprise Zone Program. The enterprise zone designation, if granted by the state, would benefit the CMC Steel Texas mill in Seguin.

Seguin Economic Development Director Josh Schneuker told the council that they've been working with CMC and its consultant for months to help bring this application forward.

"The Texas Enterprise Zone Program is an economic development tool for local communities to partner with the state of Texas to promote job creation and significant private investment that will assist economically distressed areas of the state. For a business to receive benefits under this program, the first step is a local community must nominate a business for Enterprise Project Designation. These designated projects are eligible to receive and apply for state sales and use tax refunds on qualified expenditures. These applications for the program are accepted on a quarterly basis with deadlines on the first working day of March, June, September and December. Enterprise Project Designation is for a period for up to five years. Employment and capital investment commitments must be incurred and met within the period starting 90 days before the application date through the designation's expiration date," said Schneuker.

Schneuker says CMC would benefit from the designation. In exchange for the incentive, the company will continue to invest tens of millions of dollars into the local operations.

"Staff has been working with Structural Metals also know as CMC Steel Texas and they are consulted on preparing a nomination as an Enterprise Project. The ordinance presented to city council authorizes the city of Seguin's participation in the program and designates myself as the liaison to essentially communicate and negotiate with the governor's office through their economic development and tourism division through the economic development bank, oversees zone activities and communications with qualified businesses and other entities within the zone or affected by an Enterprise project and essentially nominating Structural Metals to the office of the governor, economic development and tourism division as an Enterprise project. Structural Metals meets the criteria as an Enterprise project under Chapter 23.03 subchapter F of the act. Under these grounds, Structural Metals is a qualified business since it will be engaged in active conduct of business at a qualified business site within the governing body's jurisdiction located just outside of an Enterprise Zone and at least 35 percent of the businesses' new and or retained employees will be residents of an Enterprise Zone, economically disadvantaged individuals or veterans. Structural Metals is prepared to commit a capital investment of at least $150 million over the five year period," said Schneuker.

The council approved the application on first reading. A second and final reading of the authorization must be approved before the action becomes official. Mayor Don Keil says they want to move this forward as quickly as they can, and the council has tentatively scheduled a meeting for 5:30 p.m. Tuesday at Seguin City Hall.
SEDC; city of Seguin

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