BuddysBud said:
zigag09 said:
What about government transparency?
Don't the residents of Grimes County deserve to know the specifics of the deal the county made with a private company?
The entirety of all three tax abatement agreements are public documents. I don't know what happened during the negotiations. I have a feeling that the county left some money on the table because they didn't want to lose the project. SpaceX wanted the location, had already invested in the project and were unlikely to leave. The county probably was in a stronger negotiating position than they thought. Instead of a fixed $20,000,000 per year, I would have preferred that it would eventually increased periodically to take inflation into account. Overall it is not a bad deal for the county.
I've seen companies spend quite a bit on environmental and engineering assessments of multiple sites at once as they narrow it down to the final site. Obviously Grimes was SpaceX first choice, but it is possible they could have punted on Grimes County and pivoted to the second choice without too much of a delay. Supposedly, they had been in negotiations on another site. This was a project that will eventually exceed 50 billion. It isn't like a few million on a backup site would really matter.
The 20 million per year (with 10 million up front) for the initial years is a pretty good deal for the county. That is the equivalent of roughly a 5 billion valuation, which wouldn't be reached until the minimum investment of 5 billion by 2030 was reached. So it front loads revenue the county will need to get a jump on infrastructure needs.
For reference, the 20 million annual payment roughly doubles the "tax revenue" for Grimes county. That is a sweet deal for the county, and that might have been a factor. In all likelihood there will be additional associated businesses that want to locate close to SpaceX. What Grimes needs to do is be a little stingy with the tax incentives of those, and be just a little sweeter than Brazos and CoB/CoCS.
Another thing to consider: the 20 million cap on the backend end only applies to county M&O taxes. Bond/debt payments, road and bridge fund, and voter approved special purpose taxes appear to be excluded. The complete project at $50-100 billion (relative to the roughly $5 billion of other taxable property) would effectively be paying any debt service for the county.