We encourage Denton County commissioners to keep an open mind about tax abatements as they talk with Holt Caterpillar about placing a new site in Little Elm.
While the facility could bring a number of jobs and a tax boon, commissioners are mulling a five-year, 50 percent tax abatement proposal from Holt Cat representatives.
“They are a fine company and I am delighted they’re interested in developing in Denton County,” County Judge Mary Horn said. “Certainly that 380 corridor needs business development to take the financial impact of the property taxes off the homeowners. But I have a longstanding position of being generally opposed to tax abatements.”
We can understand Judge Horn’s position on this issue, but in today’s competitive world, tax abatements are sometimes necessary to encourage development, and this agreement wouldn’t give Holt Caterpillar a free ride.
Sure, the county would be granting the company a slight break, but 50 percent for five years beats no development for five years. And working with the company now to bring in a quality project providing new jobs and boosting tax revenue should continue to pay dividends long after the agreement ends.
Holt Cat officials told commissioners the site would add an initial capital investment of $11.5 million and bring in anticipated taxable annual sales of $28 million. Holt Cat has more than 400 employees in the North Texas area. The Little Elm site is expected to add another 40 full-time and permanent positions.
“These would be high-paying, blue-collar jobs,” Michael Puryear, general counsel of the Holt Companies from San Antonio, told commissioners.
Jennette Killingsworth, executive director of the Little Elm Economic Development Corp., told commissioners that the benefits of having Holt Cat in Little Elm would increase current budget and sales taxes by approximately 10 to 15 percent and create high-paying jobs in the area.
Precinct 1 Commissioner Hugh Coleman said more employment opportunities were needed in the northern part of Denton County.
“We need to encourage this type of development. We just don’t want to be a bedroom community for Dallas,” Coleman said. “We need to develop economically so we can stand on our own two feet. The more jobs created in Denton County, the less traffic we have with people commuting to Dallas. And these are the kind of jobs we want: high-paying technical, blue-collar jobs.”
The town of Little Elm has approved an identical abatement agreement for the site, located at the southeast corner of FM1385 and U.S. Highway 380.
Holt Cat is the authorized Caterpillar dealer for 118 counties in South, Central, North and East Texas. Headquartered in Peoria, Ill., the company sells, services and rents Cat equipment, engines and generators for construction, mining, industrial, petroleum and agricultural applications.
If their project gets the green light, Holt Cat officials said they could open for business by the end of 2014.
We’d like to see that happen. Denton County needs new jobs, and we can’t afford to risk losing quality projects like this one.
Sometimes, it pays to make a deal, and in our view, trading a reasonable tax abatement for new jobs, a boost in tax revenue and continued stability is an investment worth considering.