Officials say it will add $2 million a year to Taylor general fund
Taylor City Council, after months of secret negotiations with Samsung Austin Semiconductor, approved amended tax-benefit agreements with the South Korean company to take into account a two-year delay in the $18 billion project.
The estimated annual income from the $281 million property on Taylor’s southwest side is expected to be about $1.9 million a year, said city spokesman Daniel Seguin. Under an amended agreement approved this past week, those monies will go into the city’s general fund, officials said.
Property-tax abatements and other tax breaks from the city were part of the deal the city cut with the company to bring in an advanced semiconductor manufacturing and research facility first announced in November 2021.
Construction on the massive foundry started in 2022, with manufacturing operations slated to commence in late 2024. Changes in the market, including demand for even smaller chips, led to delays in meeting certain milestones to get the property- tax breaks, including job creation. The facility on 1,200 acres near Taylor High School is now expected to be operational by the end of 2026, the company confirmed to the Press in April.
The Samsung property sits inside a Tax Increment Reinvestment Zone that allows a large portion of the property taxes collected on the value of the improved property to flow back to Samsung to reimburse it for the infrastructure on the site.
Property taxes in the TIRZ do not go to the city’s general fund for running the city, paying first responders or filling potholes.
The amendment passed Wednesday night in a special council meeting carves out the taxable asset of Samsung contractor Linde Gas, which is located with Samsung in the reinvestment zone.
That means taxes assessed on Linde’s improvements to the property and equipment on site will now go into the city’s general fund to spend on any needs the city has.
The city also was able to cap the amount of money it spent on contracting ongoing inspections of completed construction projects and phases on the Samsung site at $9 million.
“This reduction is tied to Samsung having at least $2 billion of equipment installed and commissioned by the end of 2026,” said Mayor Dwayne Ariola from the dais after the unanimous vote approving the deal. “I really want to commend the (city) staff for working with Samsung because initially we had started this in 2027, but we wanted to reap those benefits in ’26.”
If the dollar amount of operational equipment at the foundry is less than $2 billion, then the city would only be on the hook for as little as $5 million in inspection costs.
Ariola also said there is an agreement with Samsung, although working out the details has just begun, that would allow the city access to water purchased privately by Samsung from Epcor for use in emergency shortages and to get some of the treated wastewater for resale by the city.
“This is huge for us. It’s just in its infancy and they just in good faith work with us,” Ariola said of the of the letter of intent with Samsung. “This is a forward-looking initiative that will enhance our water resilience and promote sustainability.”
Even though the terms of the agreements with Samsung needed to change because of unexpected delays, Councilman Gerald Anderson said Samsung had been a good partner with the city from the beginning and that relationship will continue for years to come. “We need to appreciate everything they’ve done for Taylor thus far,” Anderson said. “The $5 million it took to clean up after the winter storm was salesand- use tax money from Samsung (construction) so the benefits have far outweighed what we’ve had to go through.”
Sales-and-use tax from materials purchased for the construction has ebbed and flowed from month to month, but one banner month in 2022 put $6 million in city coffers, enough to conduct the cleanup from 2023’s Winter Storm Mara without incurring debt.
“The actions taken by the city of Taylor demonstrate mutual commitments to the success of Samsung’s project in Taylor,” said Samsung Austin Semiconductor spokeswoman Michele Glaze. “We appreciate the partnership and leadership of the city of Taylor in aligning on adjustments to ensure the project proceeds as planned.”
