AMARILLO, Texas (KAMR/KCIT) — Officials from the Amarillo Economic Development Corporation, along with the Amarillo City Council, expressed numerous times how historic Tuesday’s regular meeting was, with the council passing five economic development-related measures that could bring in billions of dollars in economic impact if two new companies choose to call Amarillo home.
“This might be a grand slam,” Amarillo Mayor Ginger Nelson said during the meeting. “Thirty-three years the EDC has been in existence, looking for projects to incentivize similar to this… This is a tremendous and unique impact. We’re very grateful to have this in our community. We don’t have to vote for it. We get to vote for it and what a privilege.”
The Amarillo City Council unanimously passed various economic development-related items, including location incentive agreements and tax abatements, to help convince Producer Owned Beef, LLC and CVMR (Texas) Inc. to bring their new facilities to Amarillo. The agreement with CVMR (Texas) Inc. is the largest agreement ever brought to the Amarillo City Council, officials said.
Producer Owned Beef, LLC
According to the agenda item for Tuesday’s regular City Council meeting, Producer Owned Beef, LLC is looking for locations to build a 600,000 square feet food processing facility. In Amarillo, the company is looking at 1,108 acres located between I-40 and US Hwy 287 west of FM 1912.
Kevin Carter, the president and chief executive officer of the Amarillo EDC, said during the meeting that the company was established to address increasing beef packer margins and the imbalance between fed cattle production and harvesting capacity. Producer Owned Beef, LLC will help create new harvesting capacity, giving producers direct access to controlling cattle harvesting, helping strengthen the link between cattle ranchers and consumers.
“It will be a huge benefit to our local producers. It will allow them to own two parts of that. They will be producing and then also harvesting,” Carter said after the meeting.
Various highlights of the project include $650 million in estimated improvements, 1,600 new employees and $75 million of new annual projected payroll. Carter expects that this project would bring $7 billion in economic impact over 20 years, if Producer Owned Beef, LLC picks Amarillo.
For this specific project, the Amarillo City Council unanimously passed three items, aiming at incentivizing Producer Owned Beef, LLC to build its facility in Amarillo. The items passed were:
- Location Incentive Agreement between the Amarillo EDC and Producer Owned Beef, LLC
- Under the agreement, the Amarillo EDC would provide Producer Owned Beef $8 million for the creation of jobs to be paid out over five years as they are created.
- The Amarillo EDC would also convey 610 acres, valued at more than $3.1 million, to Producer Owned Beef.
- Tax Abatement Agreement between the city of Amarillo, the Amarillo EDC and Producer Owned Beef, LLC
- The agreement would provide for an abatement of future taxes on the construction and equipment costs at 100% abatement for 10 years on $650 million estimated costs of improvements.
- Chapter 380 Economic Development Program Agreement between the city of Amarillo and Producer Owned Beef, LLC
- The city agrees to design and construct a water main extension and associated meter at an approximate cost of $3.45 million.
- The city agrees to participate in an amount not to exceed $120,000 toward a sanitary sewer extension.
- There will be a one-time permit fee amount of $1,290,000 for plan reviews and building permit.
- There will be a water rate structure agreement for the same rate as the fed cattle beef production facility, located northeast of the Rick Husband International Airport.
- Producer Owned Beef, LLC consents to future annexation of the property.
Amarillo City Councilmember Cole Stanley praised the Amarillo EDC for bringing forward this project, stressing that this kind of project is the kind of thing that will help Amarillo in the long run.
“When (the Amarillo EDC brings) a deal like this to us, it makes my job so much easier in the fact that this is exactly what you’re created to do,” Stanley said during the meeting. “This is what the (Amarillo EDC) is meant to do… It does bring about the economic impact that we need.”
CVMR (Texas) Inc.
According to the agenda item, CVMR (Texas) Inc. is looking for locations to build a 500,000 square feet mineral processing facility. In Amarillo, the company is looking at 540 acres located at US Hwy 60 west of Parsley Road.
This project, if the company chooses Amarillo, would include $1.5 billion in estimated improvements, 1,000 new employees in the first phase of the project, with the potential of up to 2,500 employees in future phases, as well as $97 million of new annual projected payroll. Carter said this is the largest project ever brought to the Amarillo City Council.
Carter said this facility would be a manufacturing and processing facility of rare earth metals, bringing in the refined elements to process and produce the various materials. Officials would bring the elements over from another state and they would be processed in Amarillo.
“The reason why is the central location in the United States that Amarillo offers, along I-40,” he said. “One of our slogans is that we are in the middle of everywhere so we certainly want to capitalize on that.”
For this project, the Amarillo City Council unanimously passed two items, to help convince CVMR (Texas) Inc. to build its new mineral processing facility in Amarillo. The items passed were:
- Location Incentive Agreement between the Amarillo EDC and CVMR (Texas) Inc.
- The Amarillo EDC will provide CVMR (Texas) Inc. with $20 million for the creation of jobs to be paid out over 10 years as they are created.
- The Amarillo EDC will convey 540 acres, valued at $4.8 million, to CVMR (Texas) Inc.
- Tax Abatement Agreement between the city of Amarillo, the Amarillo EDC and CVMR (Texas) Inc.
- The agreement would provide for an abatement of future taxes on the construction and equipment costs at 100% abatement for 10 years on $1.5 billion estimated costs of improvements.
During his comments, Stanley pointed out that it will cost the city around $80 million over the course of 10 years, what officials said would be the largest tax abatement the city has ever approved.
“So, how can we justify giving away taxes like that?” Stanley asked. “Well, $12 billion economic impact over 20 years… If you believe in capitalism, you also believe in incentivizing growth like this that produces capitalism, produces small business, produces growth in your economy.”
Overall, Nelson said these two projects are awesome, which she stressed was a “genuine expression” from the council as a whole, to have projects of this magnitude.
“Well, I think it just proves that we’ve got a great product to sell here in Amarillo,” Carter said in response to Nelson during the meeting.” Things are going really really well and you certainly want to capitalize. It’s our time, and let’s capitalize on it. That’s what we’re trying to do with these projects today.”
Now that the respective economic development-related items were passed by the council, it is in the hands of the respective businesses on whether or not they will bring the respective facilities to Amarillo.
Carter said that he hopes that the decision will be made by the two businesses in the next few months. Carter said that it is going to take educational entities, including the area school districts, along with Amarillo College, West Texas A&M University and Texas Tech University to fill the hiring needs of these companies, if they decide to come to Amarillo.
“It’s going to take all of those entities to make this thing work,” he said. “But we believe that we can. We believe that people will move here for the kind of wage that both of these projects are offering… We believe that we have enough time to get those people and that people will move to Amarillo for the opportunity because of the great product that we have here.”
If Producer Owned Beef, LLC chooses Amarillo, Carter expects that project to be around a 30-month buildout. For CVMR (Texas) LLC, Carter expects that project to be around a 30-36-month buildout if they choose Amarillo. Carter said this would give the area time to build the workforce for these two projects.
“We are going to have to get our young people coming out of high school,” Carter said. “We are going to have to retain that talent here in Amarillo and not have them move away. For the amount of money these jobs are offering, you can have a really good quality of life here in Amarillo.”
For more information about the Amarillo Economic Development Corporation, visit its website.