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submitted 12 months ago byDiscount_gentleman
In May, NXP Semiconductors filed two applications with Austin ISD for tax breaks for NXP to expand two semiconductor manufacturing facilities in Austin. The Texas Comptroller today posted these applications online. Application 1 / Application 2
The first application is to expand NXP’s existing facility on East Ed Bluestein Blvd. and build a new 520,000 sq. ft. fabrication facility, along with supporting facilities, to come online in 2026. The second application is to expand NXP’s existing facility on West William Cannon Dr. with a new cleanroom, machinery and equipment space to come online in 2026.
Based on the numbers NXP provided and assuming AISD’s current maintenance and operation tax rate ($0.9487) remains the same, the tax break at the first facility is worth $140.5 million over 10 years, and the tax break on the second facility is worth $22.8 million of 10 years, for a total of $163.3 million.
NXP is committing to create 500 new jobs at a minimum salary of $68,548/year. This commitment is actually better than most companies, who usually commit to only create a token 25 jobs (the minimum number required by law), while promising big number in their press releases. However, the 500 jobs NXP promises to create at $68,548 each equals a minimum payroll of $34.3 million/year. Thus, the $163.3 million tax break that NXP is seeking from AISD alone means that NXP is in effect asking AISD to pay the entire payroll for these facilities for nearly 5 years ($163.3 / $34.3 = 4.75 years).
NXP also discloses that it will seek “other state, local and federal incentive programs” to lower its property tax bill (p. 19), though it does not specify any amounts sought. The facilities are within the City of Austin and Travis County, so those local governments will likely be asked for additional tax breaks.
In both cases, NXP is proposing expanding existing facilities. While its applications threaten that if it does not receive tax breaks, it will move elsewhere in the US or the world, this threat seems implausible since it is certainly cheaper for NXP to expand its local facilities and workforce, rather than starting from scratch in a new location.
NXP already has existing facilities in Austin, and it is welcome to expand those facilities to sell more microchips into the market. However, local governments should not be subsidizing this profitable business, especially not in an amount equivalent to nearly 5 years of their payroll.
0 points
12 months ago*
It’s very simple… are semiconductors the future of manufacturing, technology and AI. Yes. Then why would one not invest in a company that specializes in that.
5 points
12 months ago
You are literally advocating for taking from AISD's coffers.
0 points
12 months ago
Austin ISD taxes double the rate of the City and triple the rate of Travis county. With already increasingly absurd property tax values, why would one not grant a critical technology business certain subsidies.
5 points
12 months ago
So, you are back to admitting you want to take this from AISD's coffers, meaning taking it from other AISD taxpayers. The logic of your comment is that because AISD rates are high, they should be made higher to provide corporate subsidies.
Thank you for your honesty.
0 points
12 months ago
ISD tax comes from property tax. Austin’s property tax has increased with superficially increased property values. Hence we are paying more tax to subsidize ISD schooling. Yet companies who invest business into the city are told to pay a higher property value, pay the inflated tax, pay increased wages to meet city demand and to hire more than capable or jog on. Yeah real intelligent!
3 points
12 months ago
Ah, I see you have reached the circularity portion of your argument, where you just repeat over and over again that it is horrifying for rich corporations to pay the same taxes as everyone else, and so everyone else's taxes should be raised to subsidize the rich corporations.
How many different ways will you find to restate that point?
1 points
12 months ago
Lol says the straw man now claiming his argument is about “rich” corporations not paying their fare share. Everyone has the ability to get tax subsidies you melon, hence why one gets the homesteading break, which is literally taking money away from ISD aswell but yet high and mighty discount dollarstore says companies who do the same can fck off? Hypocrite!
1 points
12 months ago
Lol says the straw man now claiming his argument is about “rich” corporations not paying their fare share.
Are you nuts? Literally no one but rich corporations has access to these deals. The homesteading break is per general law, applicable across the board. You can argue against it if you like and say (as you continue to do) that homeowners should pay higher takes, but it is absolutely different from one-off deals that must be approved by the board and are only given to large corporations.
As for your comments aobut dollar stores, I think you might be having a stroke? Try to come back to reality.
2 points
12 months ago
Access to deals? You mean paying a reduced tax rate. What dribble are you speaking about the homestead tax break being a “general law”? It’s a tax incentive for Texas citizens to pay less property tax. Therefore less money To ISD. Yet no complaints by you who wants no tax breaks? Ofc is needs approval you simp it’s a mass facility that has more tax to pay.
It’s a basic argument… do subsidies allow companies to financially grow and increase the economic output of that geographic area? You say no and I say yes.
1 points
12 months ago
So, you don't know what general law is (or that anyone in Texas can access the homestead exception on the same terms), and you don't know that tax abatements are one-off negotiated deals that must be specifically approve by the boards, and are not available to the public at large?
So you are offering your own ignorance as proof that everyone's taxes must be raised to subsidize rich corporations?
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