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<br />( <br /> <br />c <br /> <br />Tax Impact Analysis for <br />Clay Development & Consulting, Inc. <br />Underwood Business Park, Phase III (UBP) in <br />Eastern Harris County <br /> <br />The attached tax impact analysis is based upon job growth and real property investment generated by the <br />location of the Clay Development & Consulting, Inc., (Clay Development) Underwood Business Park, Phase <br />ill (UBP) in the site located in Eastern Harris County. The inventory numbers and total investment are <br />estimates based upon current plans for the facilities if the current companies interested in the project can be <br />attracted to the project. <br /> <br />The first assumption used in the analysis is that the project decision is made and construction begins by early <br />2006. The second assumption is that the taxing authority is in agreement on the Foreign-Trade Zone (FTZ or <br />Zone) issue with Clay Development. <br /> <br />The City of La Porte Park (the City) will see significant benefit with this project. It will increase the value of <br />the land and will put a significant amount of investment into the land in terms of real property enhancement, <br />buildings and equipment that will add to the tax roles of the City. The Federal exemptions on inventory tax <br />collection at the facility will not negatively impact the City, since the inventory is not currently on the City's <br />tax roles. Furthermore, an estimated 60% of the inventory is currently estimated to qualify for the exemption. <br /> <br />Clay Development is seeking a letter of support or a letter of "no contest" from the City in conjunction with the <br />FTz Expansion Application that will be required to establish the Zone Site for the facility. The overall net <br />benefit to the City is anticipated to be an annual tax revenue stream of no less than $700,000 after the FTZ <br />exemption is granted. <br /> <br />Clay Development has identified that Zone status is a key factor for the marketing of these sites. If the letter of <br />suPport is garnered from the City, then the development will locate in Eastern Harris County. A failure to <br />realize a satisfactory FTZ status in Deer Park will make the marketing of the sites to companies versus <br />neighboring Counties more difficult. This analysis does not include any of the indirect economic benefits of <br />having this project, and the estimated 275 jobs it would create. <br /> <br />I:\PROJlClay DevelopmentlClay tax namtive City of La Porte.doc <br />