Sherman is giving one of the city’s newest industrial businesses a break on its property taxes for the next five years.
The Sherman City Council approved a property tax abatement for J.P. Hart Lumber Co. during its first meeting of the new year on Tuesday. The agreement will abate 50 percent of the company’s property taxes for each of the first three years and then 25 percent for the fourth and fifth years.
“As you know, J.P. Hart Lumber has been working over the last several months to build and open a facility here in our industrial park, and they are basically there now,” City Manager Robby Hefton said. “So this agenda item is what we believe is the last steps really to put our incentives in place for them. What we’re proposing is a five-year tax abatement that complies with our internal policies here for the level of investment that they’ll have.”
With Hart Lumber investing $8 million in its new Sherman facility, the company’s operation in the city would have generated $171,000 in property tax revenues during the next five years without an abatement. The abatement agreement is expected to provide a $68,000 benefit to Hart Lumber over those same five years.
Before the council approved the abatement agreement, it held a public hearing on the proposed tax abatement to allow the public the opportunity to speak on the issue, but no one came forward.
The Grayson County Commissioners recessed their meeting Tuesday before taking action on an agenda item to consider a tax abatement for Hart Lumber for improvements within the industrial reinvestment zone. The commissioners are expected to consider the item Wednesday during a special meeting.
The Sherman council approved the creation of a commercial/industrial reinvestment zone for the Hart Lumber property during its last meeting. Hart Lumber, which provides building materials and supplies for residential and commercial building work throughout Texas, recently completed a $6.5 million facility in Sherman’s Progress Park industrial area that was built by Plyler Construction. Because of that connection, Mayor David Plyler abstained from the vote on the tax abatement during Tuesday’s meeting.
In a document provided to the council, city staff noted none of the property considered under the agreement is currently on the tax rolls, so the city would still see a net increase in property tax revenues with the abatement.
The Sherman Economic Development Corp. board approved a $510,000 incentive agreement for Hart Lumber in June 2016 and the company closed on its purchase of 30 acres along Progress Drive in July 2016, but the two entities worked on plans for the expansion into Sherman since November 2015.
Headquartered in San Antonio, Hart Lumber provides building materials and supplies for residential and commercial building work throughout Texas. The new facility in Sherman will be Hart Lumber’s sixth plant in Texas as it currently serves the Dallas-Fort Worth, Austin, San Antonio, Houston and Rio Grande Valley areas.
Hart Lumber is expecting to employ 29 people locally by June 2018 and 37 people by June of 2019.