Economic incentives for dairy deal take center stage | Local News
The city and county of Hunt have entered into a number of economic incentive agreements with HP Hood LLC, the Massachusetts company that is expected to invest $360 million and create hundreds of jobs by building a state-of-the-art dairy just outside west of Greenville.
Greenville’s ISD is still evaluating a request for a tax abatement and should consider a deal in the coming months, according to Superintendent of Schools Sharon Boothe.
Construction of the dairy at State Hwy. 66 and CR 2100 could begin in the second quarter of 2024, and commercial operations could begin in the fourth quarter of 2025, according to documents filed with the Texas Comptroller’s Office.
HP Hood proposed to build a state-of-the-art manufacturing facility to process extended shelf-life dairy and plant-based beverages. The proposed 350,000 square foot dairy facility would occupy separate buildings for laboratories, research and administrative offices; reception and processing of milk; product packaging; and storage, depending on the application.
In its initial phase, the dairy would employ around 225 people, and up to 400 in the future, according to a tax abatement application filed with the Comptroller’s Office. The company estimates that it will spend $360 million on the initial phase of the project.
The plant is located just outside the ETJ (extraterritorial jurisdiction) of the city of Greenville, an area that extends two miles from the city limits in all directions.
As part of HP Hood’s agreement with the city:
• The Greenville Economic Development Corp. would provide a $500,000 infrastructure grant to the project over five years;
• Dairy property would be protected from annexation for 15 years with two optional 15-year extensions;
• HP Hood would pay the city a payment in lieu of taxes equal to the amount of property taxes on buildings and land only, but excluding taxes on equipment and inventory;
• The city would provide fire and police protection and solid waste removal as it does for businesses within the city limits.
• HP Hood would pay for the extension of utilities, including electrical or natural gas lines;
• The city would provide potable water and sanitary sewer service to the site through line extensions financed by the company or a third-party contractor;
• The city would charge standard industry rates for water and sewer services.
The Hunt County incentive package, which was approved by the Court of Commissioners earlier this month, boils down to:
• A tax allowance of 50% ad valorem on eligible goods over 10 years, starting in 2027 or earlier;
• A personal property tax refund of 100% of eligible inventory taxes for 25 years from January 1, 2026.
These economic development incentives are authorized for cities and counties under Chapters 312 and 381 of the Texas tax code.
For its part, the Greenville Independent School District received a Chapter 313 petition from Hood that would entitle the company to a significant tax reduction over 10 years beginning in the 2026 tax year.
Under a Chapter 313 designation, a business agrees to build or install property and create jobs in exchange for a 10-year limit on the property’s assessed value for tax purposes. maintenance and operations (M&O) of the school district.
However, any loss of tax revenue by the school district would be compensated by the state, according to a spokesperson for the Comptroller’s Office. After 10 years, the school district would receive the full amount of property tax from Hood.
After construction of the dairy plant, the property would have an estimated assessed value of $360 million, and this amount is gradually decreasing through depreciation.
By the time Greenville ISD applies full taxation, the property will have an estimated assessed value of $247 million, based on the application of Chapter 313.
The gross property was appraised at $657,000 when last appraised in 2021, according to the Hunt County Central Appraisal District.