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TAX INCENTIVES

Policy Overview 

The City of Carrollton is dedicated to achieving the highest quality of development, infrastructure, and quality of life for its citizens. These objectives are met, in part, by the enhancement and expansion of the city’s economy. Additionally, the competitive nature of other municipalities on the local, state and international levels necessitates additional inducements to attract business to the community. The City’s “pro-business” philosophy is designed not only to attract high quality companies but to retain them as well. These incentives are offered on a “case by case” review of each tax incentive application. Nothing herein shall imply or suggest that the City of Carrollton is precluded from considering other options which would further the best interests of the City. A reduction in Taxes may be granted by a tax abatement or a grant utilizing 380.001 of the Texas Local Government Code.

Review Criteria

Any consideration for a tax reduction is reviewed by the Carrollton City Council. The review process is considered on the “Value Added” elements of the project. Other factors taken into consideration are total employment, inventory value and facility value. Specific considerations will include the degree to which the individual project furthers the goals and objectives of community, as well as the relative impact of the project.

A tax reduction applies to:

  • new construction activities, whether a new facility or expansion of an existing building
  • large inventory companies relocating or expanding in the City

The tax incentive is in the form of a rebate on the City of Carrollton real and/or personal property taxes.

Value of Incentives

After it has been determined that a tax reduction be offered, the approximate value of that incentive can be calculated from the following table. However, this table should only be used as a guide for incentives, since each project is evaluated individually.

Value of Project terms of reduction % of reduction
$50,000,000 10 years 50%
$35,000,000 9 years 50%
$20,000,000 7 years 50%
$10,000,000 5 years 50%
$ 5,000,000 3 years 30%

Tax Incentive Application 

 

TRIPLE FREEPORT EXEMPTION

The City of Carrollton offers Triple Freeport Exemption from all local taxing authorities, City, County and School Districts. The exemption applies to inventory that is brought into Carrollton from outside Texas and then reshipped out of state within 175 days is exempt from inventory tax. Carrollton also has special taxing districts such as Valwood Industrial Park.

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RETAIL REDEVELOPMENT INCENTIVES

Retail Redevelopment and Rehabilitation Program

Performance-Based Matching Grant

The Program is sponsored by the City to provide financial incentives to existing retail shopping centers and other retail facilities for enhancements and/or redevelopment. Improvements must enhance the tax base related to the retail facilities and surrounding development. The Program is retention-based with the goal of rehabilitating the retail facilities for aesthetic or architectural appeal. Each application is determined on a case by case approach.

This is a matching grant program. The City may elect to make a grant in an amount up to 100% the cost of the improvements (refer to eligible expenses below).  Such grant will not to exceed $1 million of public funds for each grantee.

1. Acceptable Categories of Improvements

The following are the eligible expenses:

  • Upgrade or enhanced landscaping improvement costs
  • Parking lot improvement costs
  • Signage upgrade costs
  • Center façade improvement costs
  • Center redevelopment; mixed-use/residential or office improvement costs

2. Eligibility Criteria for Eligible Retail Facilities

  • The retail facility or facilities must be older than twenty (20) years.
  • The property on which the retail facility or facilities is located must be in excess of 2 acres, unless a smaller acreage is approved by the City.
  • Potential impact of the reinvestment project on surrounding neighborhoods.

3. Application and Approval Process

  • An application for incentive must be submitted to the City's Office of Economic Development by the land owner. The application should include a detailed description of the project including renderings or drawings of the finished project, a project budget including sources of funds and a project timetable. The application should describe how the project will enhance the ability of the shopping retail center to attract and retain tenants.
  • Project review of each application is required by staff including appropriate comments and recommendations for changes prior to submission to the City Council Retail Subcommittee (the "Retail Subcommittee").
  • All applications will be reviewed by the City Council Retail Subcommittee. Applicants may be asked to present their project before the Retail Subcommittee and any modifications to the application will be made prior to forwarding the application to the full City Council with a recommendation for approval or denial.
  • City Council will review the recommendation of the Retail Subcommittee and vote to either approve or deny the grant application.
  • Grant incentives will consist primarily of cash payments payable upon successful completion of all facility improvements or redevelopment as outlined in an incentive agreement to be entered into between the City and the owner of the retail facility or facilities receiving the grant.

Back-fill and Specialty Retailer Incentive Program for Vacant Grocery Store Anchors

The Redevelopment Subcommittee met on May 5, 2009 and made the recommendation that Council adopt the Back-fill and Specialty Retailer Incentive Policies. City Council adopted the Retail Redevelopment Grant Program in 2007 which provides grant monies to aging and underutilized retail facilities. These policies are an extension of that program in order to encourage retailers or specialty retailers to back-fill vacant grocery store anchors in excess of 50,000 square feet in the City. The back-fill policy is for those tenants who can fill more than 50 percent of the total anchor square footage; while the specialty retailer policy is for those tenants who cannot fill the required 50 percent of the total square footage, but must have a demised space of greater than 10,000 square feet.

Back-fill Incentive Program for Vacant Grocery Store Anchors

The goal of the program is to make grants of public money to promote and stimulate local economic development of vacant anchor stores of greater than 50,000 square feet.

1. Vacant Anchor Incentives:

  • The vacant anchor incentives could include grants for exterior tenant improvements: 
         o Façade improvements including: painting; lighting, awnings, doors, windows, etc.;
         o Signage on storefront and perimeter signage;
         o Landscaping; and
         o Parking
    • The anchor must be in excess of 50,000 SF.
    • Demised space must be a minimum of 50 percent of the total anchor square footage.
    • This incentive offers eligible recipients an “Exterior Tenant Improvements Allowance” only which may include façade improvements, doors, windows, signage, painting, lighting, landscaping, awning, and parking.
    • The allowance is a one-time only grant and there will be a maximum amount that is eligible for funding.
    • The incentives offered would be determined on a case-by-case basis.

    2. Eligible Types of Businesses

    • Retailer or specialty retailers.
    • There must be a public benefit to the neighborhood such as the provision of goods and services currently not available, new jobs, etc.
    • For profit, sales tax paying businesses.
    • The applicant may own the real estate in which the business is located. Alternatively, the applicant must have a fully executed lease, with a term of not less than five years.
    • Private investment must exceed the amount of the grant given by the City for tenant improvements.
    Ineligible Types of Businesses:
    This program is for specialty retailers only. The City of Carrollton may decide on a case-by-case basis to exclude other business activities which it believes does not benefit the health, safety, and welfare of the community and/or do not meet the objectives of this program.

    3. Eligibility Criteria:

    Prior to the property becoming vacant, the property must have been a grocery store for at least five years. This incentive is for the attraction of new specialty retailers who move into a vacant grocery anchor store. The tenants’ eligibility for funding will be determined based on factors such as: 

  Job creation 
  Private investment 
  Square footage of the retail or leased space
  Ability to attract other traffic generators or retail stores 
  Uniqueness 
  Sector of market served 
  Minimum of a five-year lease

4. Eligible Tenant Improvements:

• The applicant’s plans and permitting process could be expedited.
• Exterior Tenant Improvements allowance: façade improvements, doors, windows, signage, painting, lighting, landscaping, painting, awing, and parking.
• All grants will be made on an invoice-reimbursement basis only.

5. Funding Eligibility:

Funding for this program will be a maximum of $2-$5/square feet for the tenant space occupied (gross floor area), not to exceed the total square footage of the vacant anchor. These monies will be given to the owner/developer of the respective property for reimbursement of eligible tenant improvements. The allowance is a one-time only grant.

6. Application and Approval Process:

• An application for incentive must be submitted to the City's Office of Economic Development by the owner/tenant. The application should include a detailed description of the project including renderings or drawings of the finished project, a project budget including sources of funds and a project timetable. The application should describe how the project will enhance the ability of the shopping retail center to attract and retain tenants.
• Project review of each application is required by staff including appropriate comments and recommendations for changes prior to submission to the City Council Redevelopment Subcommittee (the "Redevelopment Subcommittee").
• All applications will be reviewed by the City Council Redevelopment Subcommittee. Applicants will be interviewed by the Redevelopment Subcommittee and any modifications to the application will be made prior to forwarding the application to the full City Council with a recommendation for approval or denial.
• City Council will review the recommendation of the Redevelopment Subcommittee and vote to either approve or deny the grant application.
• Grant incentives will consist primarily of cash payments payable upon successful completion of all facility improvements as outlined in an incentive agreement to be entered into between the City and the owner/tenant of the retail space or facility receiving the grant.


Specialty Retailer Incentive Program for Vacant Grocery Store Anchors

The goal of the program is to make grants of public money to promote and stimulate local economic development of vacant grocery anchor stores of greater than 50,000 square feet specifically for specialty retailers who back-fill less than 50 percent of the vacant grocery store anchor space.

1. Specialty Retailer Definition:

A retailer concentrating on selling one merchandise line of goods or services for a particular and usually selective clientele. Examples are stores selling sporting goods, organic food, electronics and movie theatres. Specialty retailers have a narrow but deep selection in their specialty.

2.  Specialty Retail Incentives:

• The specialty retail incentives could include grants for: 
    o Façade improvements including: painting; lighting, awnings, doors, windows, etc.;
    o Signage on storefront and perimeter signage;
    o Landscaping; and
    o Parking
• If the owner/tenant cannot back-fill 50 percent or more of the vacant grocery store, the owner/tenant may fill a portion of the vacant grocery store total square footage. However, the demised space must be a minimum of 10,000 square feet.
• This initiative offers eligible recipients an “Exterior Tenant Improvements Allowance” only which may include façade improvements, doors, windows, signage, painting, lighting, landscaping, awing, and parking.
• The allowance is a one-time only grant, and there will be a maximum amount that is eligible for funding.
• The incentives offered would be determined on a case-by-case basis.

3. Eligible Types of Businesses:

• Specialty retailers including home furnishings, electronics, sporting goods, movie theatre and organic, natural or gourmet food stores.
• There must be a public benefit to the neighborhood such as the provision of goods and services currently not available, new jobs, etc.
• For profit, sales tax paying businesses.
• The applicant may own the real estate, in which the business is located. Alternatively, the applicant must have a fully executed lease, term not less than five years.
• Private investment must exceed the amount of the grant given by the City for tenant improvements.

4. Ineligible Types of Businesses:

This program is for specialty retailers only. The City of Carrollton may decide on a case-by-case basis to exclude other business activities which it believes does not benefit the health, safety, and welfare of the community and/or do not meet the objectives of this program.

5. Eligibility Criteria:

Prior to the property becoming vacant, the property would have to have been a grocery store for at least five years. This incentive is for the attraction of new specialty retailers who move into a vacant grocery anchor store. The tenants’ eligibility for funding will be determined based on factors such as: 

  Job creation 
  Private investment 
  Square footage of the retail or leased space 
  Ability to attract other traffic generators or retailers 
  Uniqueness 
  Sector of specialty market served 
  A minimum of a five-year lease

6.  Eligible Tenant Improvements:

• The applicant’s plans and permitting process could be expedited.
• Exterior Tenant Improvements allowance: façade improvements, doors, windows, signage, painting, lighting, landscaping, painting, awning, and parking.
• All grants will be made on an invoice-reimbursement basis only.

7. Funding Eligibility:

Funding for this program will be a maximum of $2.00-$5.00/square feet for the tenant space occupied (gross floor area) not to exceed the total square footage of the vacant anchor. These monies will be given to the owner/tenant of the respective property for reimbursement of eligible tenant improvements. The allowance is a one-time only grant.

8.  Application and Approval Process:

• An application for incentive must be submitted to the City's Office of Economic Development by the owner/tenant. The application should include a detailed description of the project including renderings or drawings of the finished project, a project budget including sources of funds and a project timetable. The application should describe how the project will enhance the ability of the shopping retail center to attract and retain tenants.
• Project review of each application is required by staff including appropriate comments and recommendations for changes prior to submission to the City Council Redevelopment Subcommittee (the "Redevelopment Subcommittee").
• All applications will be reviewed by the City Council Redevelopment Subcommittee. Applicants will be interviewed by the Redevelopment Subcommittee and any modifications to the application will be made prior to forwarding the application to the full City Council with a recommendation for approval or denial.
• City Council will review the recommendation of the Redevelopment Subcommittee and vote to either approve or deny the grant application.
• Grant incentives will consist primarily of cash payments payable upon successful completion of all facility improvements as outlined in an incentive agreement to be entered into between the City and the owner of the retail space or facility receiving the grant.

Retail Redevelopment & Rehabilitation and Back-fill & Specialty Retailer Incentive Program Application

 

Redevelopment Incentive Policy for Planned Development 169 (PD 169)

1. Performance-based Matching Grant

The Program is sponsored by the City to provide development incentives for residential and commercial property owners in PD 169 for the replacement of existing development with redevelopment of a site or infill development of vacant lot(s). Any improvements must enhance the tax base related to the residential/commercial properties and surrounding development. The incentives are limited to reimbursement of development fees. Each application is determined on a case by case approach.

2. Criteria:

• The site must be located in PD 169.
• The development must be in accordance with all City ordinances regarding PD169.
• The redevelopment of the site should include the replacement of existing development or an infill development on vacant lot(s).
• Threshold of a minimum of $250,000 of new construction value.
• Prior to the reimbursement of any fees, a Certificate of Occupancy must be issued for the development, and the City must declare that the project complies with the approved Incentive Agreement, the building permit and other code compliance inspections, and is in conformance with all applicable state and local laws and regulations or a valid wavier thereof.
• Post-improvement taxable value of the project must result in an increased assessed valuation of at least 50%.

3. Requirements:

• Completed construction drawings with floor plans and elevation drawings are to be submitted as part of the Development Plan.
• Aesthetic and/or architectural appeal of the improvement will be considered.
• All incentives are on a reimbursement basis only.
• An Incentive Agreement with established enhancements is required to be executed.

4. Eligible Incentives:

• Limited to a grant which rebates development fees (which had been paid to the City):
- Planning fees
- Building permit fees
- Impact fees
- Inspections fees
- Water and sewer fees

5. Application and Approval Process:

• An application for an incentive must be submitted to the City's Office of Economic Development by the land owner.
• Project review of each application is required by staff including appropriate comments and recommendations for changes prior to submission to the City Council Redevelopment Subcommittee (the "Redevelopment Subcommittee").
• All applications will be reviewed by the City Council Redevelopment Subcommittee. Applicants will be interviewed by the Redevelopment Subcommittee and any modifications to the application will be made prior to forwarding the application to the full City Council with a recommendation for approval or denial.
• City Council will review the recommendation of the Redevelopment Subcommittee and vote to either approve or deny the grant application.
• Grant incentives will consist of payments payable in accordance with this Policy and an Incentive Agreement to be entered into between the City and the owner of the residential or commercial property receiving the grant.

Redevelopment Incentive for PD 169 Application

 

Sign Incentive Program for PD 169

1. Performance-Based Grant

The Program is sponsored by the City to provide financial incentives to existing commercial property owners in PD 169 for sign replacements/upgrades. Improvements/upgrades to the existing signage must enhance the tax base related to the commercial properties and surrounding development. The Program is retention-based with the goal of replacing the existing signage for aesthetic appeal. Each application is determined on a case by case approach.

The Program is a performance-based grant program. If a grant is to be utilized, the City may elect to make a grant in an amount up to 100% of the cost of the improvements (refer to eligible expenses below); such grant of public funds may not exceed $4000 for monument signs and $2000 for wall signs for each grantee.

2. Acceptable Categories of Improvements

The following are the eligible expenses:

  • Signage upgrade costs

3. Eligibility Criteria

  • Applicant must have a valid certificate of occupancy in PD 169
  • Replacement /upgraded signage must have potential impact on the surrounding community

    For Monument or Permanent Freestanding Signs:
  • $4,000 maximum grant per sign
  • If replaced by 01/01/2010, reimburse up to 100% of the $4000 limit
  • If replaced by 06/01/2010, reimburse up to 50% of the $2000 limit
  • If replaced by 12/31/2010, reimburse up to 33% of the $1000 limit
  • All will be reimbursement based—must complete work, and then applicant must present invoices or have contractor provide invoice to city in order to be reimbursed

        Wall Signs:

  • $2,000 maximum grant per sign
  • If replaced by 01/01/2010, reimburse up to 100% of the $2000 limit
  • If replaced by 06/01/2010, reimburse up to 50% of the $1000 limit
  • If replaced by 12/31/2010, reimburse up to 33% of the $500 limit
  • All will be reimbursement based—must complete work, and then applicant must present invoices or have contractor provide invoice to city in order to be reimbursed

4. Application and Approval Process

  • An application for a Sign Incentive Grant must be submitted to the City's Office of Economic Development by the applicant.
  • Project review of each application is required by staff including appropriate comments and recommendations for changes prior to submission to the City Council Retail Subcommittee (the "Retail Subcommittee").
  • All applications will be reviewed by the City Council Retail Subcommittee. Applicants will be interviewed by the Retail Subcommittee and any modifications to the application will be made prior to forwarding the application to the full City Council with a recommendation for approval or denial.
  • City Council will review the recommendation of the Retail Subcommittee and vote to either approve or deny the grant application.

Grant incentives will consist primarily of cash payments payable upon successful completion of all sign improvements as outlined in the Incentive Agreement to be entered into between the City and the owner/tenant of the commercial property receiving the grant.


Sign Incentive Application


Section 380 Economic Development Program

Public/ Private Agreement Program for Transit-Oriented Development

PURPOSE: It is the purpose of this program to provide assistance only for projects where such assistance is necessary to stimulate private investment to add further value to the project above current zoning requirements. Accordingly, the program is available when agreements between the City and private parties that are not tax-exempt are approved by City Council prior to investment occurring. Projects seeking economic incentives must provide written assurance that ‘but for’ the incentives sought, the proposed project would be substantially altered such that the economic returns to the city would be reduced or the project would not otherwise occur in the City. In addition, all certified LEEDs projects will be given special consideration.

1. CATEGORIES OF PARTICIPATION:

TAX REBATE: Temporary abatement of either real estate or personal property taxes is not available within the TIRZ district.

INFRASTRUCTURE COST PARTICIPATION: City may pay a portion or the entire amount of the required City infrastructure (within ROWs or easements dedicated to the City). For those projects where certain City escrow fees will be required, a waiver of such fees may be considered. In addition, third party utility improvements may be rebated to facilitate aesthetic requirements of the Transit Center District. Participation is considered on a ‘case by case’ basis with limits outlined on the table below.

DEVELOPMENT FEE REBATES: City may rebate a portion or the entire amount of all City fees charged in the regulation of land development. Participation is considered on a ‘case by case’ basis with limits outlined on the table below. Rebates are payable only after a Certificate of Occupancy is granted.

CITY-OWNED REAL PROPERTY/ PUBLIC RIGHT-OF-WAY: The City may transfer ownership of real property at or below market rate (or City’s purchase price, whichever is less) and as required by statute. In the case of public right-of-way, the City may rebate fees charged by the City for abandonment of public rights-of-way. Participation is considered on a ‘case by case’ basis with limits outlined on the table below. Rebates are payable only after a Certificate of Occupancy is granted. Transfer of real property will occur upon issuance of building permit for a fully financed project.

2. Eligibility Criteria:

  • Project located within City’s TIRZ #1 as described in Ordinance 3034.
  • Project meets the purpose of this Program and assistance is necessary to stimulate private investment to add further value to the project above current minimum zoning requirements.

3. Application and Approval Process:

  • An application for incentives must be submitted to the City’s Office of Economic Development by the land owner/ developer. The application should include a detailed description of the project, including renderings or drawings of the proposed project, and a project budget including sources of funds and a project timetable.
  • Project review of each application is required by staff including appropriate comments and recommendations for changes prior to submission to the City Council Transit-Oriented Development Subcommittee (the TOD Subcommittee).
  • All applications will be reviewed by the TOD Subcommittee. Applicants may be interviewed by the TOD Subcommittee and any modifications to the application will be made prior to forwarding the application to the full City Council with a recommendation for approval or denial.
  • City Council will review the recommendation of the TOD Subcommittee and vote to either approve or deny the application.
  • Incentives will not be granted until a successful binding incentive agreement is entered into between the City and the owner/ developer.

4. Table of Incentives

    Tax Rebate Infrastructure Cost Participation Development Fee Rebates City Owned Real Property/ Public ROW
  Minimum Eligibility Percentage on added real estate or personal property value
City pays portion of infrastructure Rebate of fees charged by the City in the regulation of land development Transfer of Ownership
City’s Master Developer Project located within boundaries of TIRZ #1

$5 Million Minimum Development Cost*
None Case-by-case

Up to 50% maximum

Participation shall not exceed 30% of total on-site improvement costs

Waiver of Development Escrow
Case-by-case

Up to 100% maximum rebate on not-to-exceed basis

Payable after Certificate of Occupancy issued
Case-by-case

Rebate up to 100% maximum based on City’s purchase price and related fees
All Other Development Project located within boundaries of TIRZ #1

$3 Million Minimum Development Cost*
None Case-by-case

Up to 40% maximum

Participation shall not exceed 20% of total on-site improvement costs

Waiver of Development Escrow
Case-by-case

Up to 80% maximum rebate on not-to-exceed basis

Payable after Certificate of Occupancy issued
Case-by-case

Rebate up to 80% maximum based on City’s purchase price and related fees

TOD Incentive Application

For further information, please contact Mr. Brad Mink, Director of Economic Development, at 972-466-3391.

 

Last updated: 10/8/2012 11:34:37 AM