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A location near Taylor is competing with Austin for Samsung’s new $ 17 billion chip manufacturing facility, and the Taylor School District is considering an incentive deal that would give the tech giant a $ 314 million tax break over $ 10, according to new documents filed with the state Years could bring Thursday.
Filings with the Texas Audit Bureau earlier this year showed that Samsung was seeking more than $ 1 billion in incentive agreements with several Travis County tax authorities to build the facility – which the company said will create 1,800 jobs – on a site next door its existing operation in Austin.
But the new filing – a proposed incentive agreement between Samsung and the Taylor Independent School District – confirms that a Williamson County location is also in the running. This had previously been reported by multiple media outlets, but Samsung declined to confirm. Thursday’s filing does not indicate the exact location of the property other than that it is near Taylor.
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Samsung is also considering two locations in Arizona – near Goodyear and Queens Creek – and one location in Genessee County, NY. Samsung is also negotiating with all three potential locations, according to the documents. The company evaluated locations for talent access, the existing semiconductor manufacturing ecosystem, rapid time to market, and strong public-private partnerships.
Samsung’s new manufacturing facility is expected to be the company’s most advanced to date and would expand Samsung’s competitiveness with other chip makers.
“No decision was made”
Samsung spokesman Michele Glaze said Thursday that a decision has not yet been made as to where the facility will be built.
“As Samsung plans to invest in expanding its foundry capabilities in the US, we are continuing our due diligence in multiple locations for possible future expansion,” she said in a statement. “At this point, however, no decision has been made. We are fortunate to be considering opportunities in Arizona, New York, and Texas. We consider a variety of factors, from a strong talent pool, semiconductor ecosystem, to competitive economic development opportunities are sufficient.” and a stable supply infrastructure. “
Amber Gunst, CEO of Austin Technology Council, said Central Texas has had a longstanding relationship with Samsung and hopes the company will choose one of the local locations.
“Central Texas’ relationship with Samsung continues to be one of our strongest technology and manufacturing alliances. The jobs they have brought to our region have changed so many lives for the better, ”said Gunst. “I am confident that this relationship will continue to grow.”
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Austin is already home to Samsung’s largest operation outside of its South Korean headquarters and its only US manufacturing facility. The company says it has about 10,000 employees at its main plant in Austin, 3,000 of whom are Samsung employees and the rest are contractors. Samsung also has a research and development facility in Austin.
“Because of its strong connections to the local community and the successful past 25 years of manufacturing in Texas, Samsung Austin Semiconductor intends to continue investing in the region and state,” Samsung said in the filing on Thursday.
The proposed 10-year deal with the Taylor School District would cap the value of Samsung’s facility and property to $ 80 million for calculating the maintenance and operating portion of school taxes. Samsung, for example, estimates the facility will have a market value of $ 4.35 billion in the sixth year of the transaction, but the property would still be valued at only $ 80 million in maintenance and operations taxes to the Taylor School District.
In the sixth year alone, the tax break for Samsung could amount to $ 44 million. Cumulative over 10 years could add up to 314.1 million US dollars.
The proposed incentive deal – which has not yet been approved by the Taylor Schools Board or accepted by Samsung – is a Chapter 313 agreement. Chapter 313 refers to the section of Texas tax law that allows school districts to provide property tax breaks for economic development projects .
The company is also seeking Chapter 380 and 381 tax breaks and assistance from the Texas Enterprise Fund, the filing said. It said it will pursue incentives related to infrastructure and utility improvements, price cuts and other monetary benefits to help build and operate the site.
“The potential value is exceptional”
Industry analysts told the American Statesman last week that central Texas is a strong contender for Samsung’s new facility.
A new facility in central Texas would build on the region’s strong technology manufacturing industry, including fabs operated by NXP Semiconductor and Infineon. The Austin regional manufacturers’ association says about a quarter of all manufacturing output in the region comes from semiconductor companies.
Ed Latson, the executive director of the manufacturers’ association, said it was not surprising that Samsung is considering Taylor. He said it was critical to the region’s future that either Austin or Taylor land the new Samsung facility.
“Samsung’s investment is unprecedented and the potential value is exceptional for all of us,” he said. “It will drive billions of dollars in salaries and economic development to the area, be a huge stream of cash for local schools, and keep our semiconductor sector up to date with the latest technology.”
Tia Stone, President and CEO of the Taylor Chamber of Commerce, said the project would bring more resources to the school district and help expand the community if Taylor pulled in the Samsung facility.
Stone said she believed Samsung and its employees would feel welcome in the smaller community.
“It’s a great community to walk in, be it the grocery store or the Texas Beer Co., and you know the people who are there,” she said. “It’s comforting and there is a great supportive community.”
Travis County Incentives
According to documents filed with the state, Samsung has already pursued $ 1 billion incentives in Travis County, showing the tech giant is demanding tax breaks from Travis County, the city of Austin, and the Manor School District, as well as incentives from Texas Enterprise Fund.
Yoojin Cho, a spokesman for Travis County, confirmed Thursday that Samsung had filed for an economic development agreement with the county. The Travis County Commissioners Court is due to receive a briefing on the project application on Tuesday.
“Travis County can confirm that Samsung Austin Semiconductor has filed an application for an Economic Development Performance Agreement for the Silicon Silver Project. Travis County Commissioners Court looks forward to evaluating the application and ensuring that any agreement that may arise with the company benefits the Travis County community in a fair and equitable manner, “Cho said in a statement.
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Documents filed with the state in February indicated that Samsung was planning to apply for an 85 percent tax break from Travis County, which could be worth $ 610.5 million, over a 20-year period. Of the city of Austin, Samsung said it was planning an 85% tax break that could be worth $ 872.5 million over 20 years. The company is considering a Chapter 313 agreement with the Manor School District that could translate into tax savings of $ 252.9 million.
Incentive filings also indicated that the expansion could create 1,800 jobs, and Samsung is suggesting an average starting wage of $ 66,254 for employees. It is estimated that the facility could have a local economic impact of $ 8.6 billion in its first 20 years of operation.
Samsung’s decision on a location for the fab could be months away as agreements across the various states are ongoing. It also remains to be seen whether network stability problems could affect the chances of the locations in central Texas. Samsung was one of several major industrial power consumers in the city ordered to shut down or shut down during the February freeze when millions of Texas homes and businesses lost electricity and the state power grid was on the verge of shutting down.
The American government employees Bob Sechler and Andrea Klick contributed to this report.
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