The City of Mesquite’s Office of Economic Development promotes, encourages, and enhances the creation of jobs and capital investments in Mesquite, Texas. Mesquite desires to attract and retain high quality businesses in the City. These businesses may be manufacturing, office, retail, commercial, or a mixed-use project. Any business wishing to have incentives considered by the City must first complete a Business Incentive Program Application and submit that to the Office of Economic Development. The offer of incentives is tied to an analysis of the impact on community services and to the goals of the community as established by the Mesquite City Council. The City Council has final authority on the implementation of City business incentives.
The State of Texas also offers business assistance and those resources are listed below. The City of Mesquite will work with businesses to secure the most favorable incentives available from the State.
Please click here to download Business Incentive Program Application
PROPERTY TAX RULE 9.105
The Texas Comptroller of Public Accounts offers a refund of franchise and sales/use taxes paid by companies owning certain abated property. A company who meets the following three conditions may apply for a refund:
- Paid property taxes to a school district on property located in a reinvestment zone;
- Is exempt in whole or in part from property tax imposed by a city or county under a tax abatement agreement; and
- Is not in a tax abatement agreement with a school district.
TEXAS ECONOMIC DEVELOPMENT ACT (HB 1200)
This act provides relief from school district property taxes for companies making large capital investments of $20 million to $100 million or greater. The appraised value of qualifying capital investments is capped based on a sliding scaled tied to the total property wealth of the school district where the investment is located. The investment amount is determined over a 2-year period. In general, a school district may abate 100% of the appraised value over the applicable cap of improvements and tangible personal property used in manufacturing for up to 8 years, beginning in the third year of investment. The company will pay taxes based on the full-appraised value during the first two years but is entitled to a refund of any amounts paid during that period on the value in excess of the applicable cap. In addition the company must create at least 25 new permanent jobs, pay at least 80% of a group health benefit plan for its employees, and pay at least 100% of the county average weekly wage.
EXEMPTION FOR POLLUTION CONTROL EQUIPMENT
A company that invests in pollution control equipment that will meet or exceed federal, state, or local environmental laws, rules, or regulations may apply for a positive use determination from the Texas Natural Resource Conservation Commission. This determination will exempt the property from ad valorem taxes.
NATURAL GAS AND ELECTRICITY SALES AND USE TAX EXEMPTION
Companies are exempt from paying state sales and use tax on electricity and natural gas used in manufacturing, processing, or fabricating tangible personal property. The company must complete a predominate use study showing that at least 50% of the electricity or natural gas consumed by the business directly causes a physical change to a product.
Manufacturing Machinery and Equipment Sales and Use Tax Exemption
Leased or purchased machinery, equipment, replacement parts, and accessories that have a useful life of more than six months, and that are used or consumed in the manufacturing, processing, fabricating, or repairing of tangible personal property for ultimate sale, are exempt from state and local sales and use tax. Texas businesses are exempt from paying state sales and use tax on labor for constructing new facilities. Machinery exclusively used in processing agricultural products by the original producer is also exempt.
CLEAN ROOMS EXEMPTION
Clean rooms used in the production of semiconductor components are exempt as manufacturing equipment.
TEXAS ENTERPRISE FUND
The 78th Legislature created the Texas Enterprise Fund, giving the Governor the ability to respond quickly to opportunities to bring companies and jobs to Texas. The fund is intended to attract high-impact facilities that have the opportunity to provide high returns for taxpayer investment. More information on the Texas Enterprise Fund is available by visiting the website of the Office of the Governor.
EMERGING TECHNOLOGY PROGRAM
This program is designed to help Texas create jobs and grow the economy over the long-term by expediting the development and commercialization of new technologies and attracting and creating jobs in technology fields. For more information regarding the application process or funding, contact Mark Ellison with the Office of the Governor at 512.463.1472.
CHAPTER 380 AGREEMENTS
Retail businesses are an important element in Mesquite’s economy and the City may consider incentives to assist in growing that portion of the City’s tax base. These incentives are negotiated between the company and the City.
TAX INCREMENT FINANCING
The city can designate a reinvestment zone to provide tax increment financing of project costs for public works or public improvements in the zone. Tax increment bonds or notes may be used to pay project costs. The proceeds from taxes on improvements within the zone are used to pay the debt service on the bonds or notes or for the cost of the project for a designated time as determined by a TIF plan adopted by the taxing entities participating. School districts are prohibited from participating in TIFs. Mesquite currently operates three TIF Zones.
INDUSTRIAL REVENUE BONDS
The City of Mesquite may issue tax-exempt bonds to finance land and depreciable property for manufacturing facilities. The maximum bond amount is $10,000,000 for tax-exempt issues, and the maturity of the bonds may extend to the lesser of 40 years or 120 percent of the depreciable life of the assets being financed. Eligible project costs include the acquisition by a business of an existing facility, acquisition of land, construction of new facilities, machinery, tools, equipment, and a limited amount of the bond issuance costs. The bonds are subject to the state’s private activity bond volume cap administered by the Texas Bond Review Board.
The City of Mesquite, the Mesquite Independent School District, and Dallas County have all adopted the Freeport Exemption making Mesquite a leading Triple Freeport Community in the north Texas region.
TAX PHASE-IN PERIOD (ABATEMENT)
The City of Mesquite may consider a tax phase-in period for certain projects. This incentive is designed to help off-set some of the initial costs of starting, relocating, or expanding a business and is offered after careful review of the project and its impact on the community and its compliance to the goals and objectives of the City.
INFRASTRUCTURE COST PARTICIPATION
The City of Mesquite may, as an incentive to a property owner or developer, give consideration to participation in the cost of water and sanitary sewer utility improvements, both off-site and on-site, required to serve an industrial or commercial park. The policy will be considered on a case by case basis and the project must meet the economic goals of the City.
The City of Mesquite owns land that may be suitable for certain businesses and may offer the land at a discounted rate to encourage development.