HUTTO – The Hutto Megasite will soon be home to the new 225acre Skybox Datacenters campus, according to Mike Arismendez, chair of the Hutto Economic Development Corporation.
On Nov. 17 city council approved the creation of a new Tax Increment Reinvestment Zone (referred to as TIRZ 3) to fund the infrastructure needed at the site in order to build the new facility.
“This is a project the EDC has been working on for about a year and we’re glad that we’ve finally been able to ink the deal,” Arismendez said. “With Skybox now coming in that’s going to give us the opportunity to impact on the positive side for the city of Hutto, not to mention the fact it will be a big boom in the property tax base which will be beneficial to everyone here.”
Benefits discussed included well-paying jobs, improved internet connectivity, an increase in regional economic investment and increased growth of businesses in similar or supportive industries.
Skybox provides data services for Fortune 500 and Fortune 100 companies at its six facilities nationwide. Skybox CEO and co-founder Rob Morris said the Hutto campus will be their largest. The company is working with Prologis Logistic Services to build the site.
“(Prologis is) the world’s largest owner of real estate with about 1.2 billion square feet of real estate globally and just under $200 billion of assets under management,” Morris said.
Morris explained that a financially strong partner means reliable access to capital in an unreliable economy and a long-term strategic outlook. He also said the company expects to reveal their facility plans at the end of the year.
TIRZ 3 was created in order for the city to make necessary infrastructure improvement so that the Hutto Megasite can accommodate this type of industry growth.
Bob Farley, director of Hutto EDC, noted that these types of financial tools are commonly used by local governments in areas where there are potentially large capital investments to be made in a specific geographic area.
“Essentially it’s grabbing future tax revenues from participating tax units and using those to pay for improvements,” he said.
Travis James, vice president of Austinbased economic analysis and public policy consulting firm TXP, laid out the details of the TIRZ for the council members.
The borders of the zone encompass about 1500 acres, most of which is currently agricultural land with approximately a $1.6 million base value, he explained. By approving the TIRZ before the end of the year, the base tax rate will be calculated at the agricultural value, and the increases realized by switching to industrial use will be counted as incremental taxes.
The TIRZ period is set for 25 years. The city has agreed to direct 50% of the increased portion of taxes collected during this time to the TIRZ fund, and an interlocal agreement with Williamson County to do the same is in the works, James said.
“I think what’s important to remind folks is it’s not a tax increase. The tax rate goes up and down. This doesn’t impact the tax owner, the tax payers or the citizens,” he said.
City council approved a seven-person TIRZ board, naming council members Dan Thornton, Amberley Kolar and Randal Clark to the board with Thornton acting as chair. Shawn Lucas and Rick Hudson were also appointed, and two positions are designated for the county to appoint members.
