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<br />e <br /> <br />e <br /> <br />(c) New and Existing Facilities. Abatement may be granted for <br />new facilities and improvements to existing facilities for <br />purposes of modernization or expansion. <br /> <br />(d) Eligible Property. Abatement may be extended to the value <br />of buildings, structures, fixed machinery and equipment, <br />site improvements plus that office space and related fixed <br />improvements necessary to the operation and administration <br />of the facility. <br /> <br />(e) Ineligible Property. The following types of property shall <br />be fully taxable and ineligible for abatement: land; <br />inventories; supplies; tools; furnishings, and other forms <br />of movable personal property; vehicles; vessels; aircraft; <br />housing; hotel accommodations; deferred maintenance <br />investments; property to be rented or leased except as <br />provided in Section 2(f); improvements for the generation <br />or transmission of electrical energy not wholly consumed by <br />a new facility or expansion; any improvements, including <br />those to produce, store or distribute natural gas, fluids <br />or gases, which are not integral to the operation of the <br />facility; property which has an economic life of less than <br />15 years; property owned or used by the State of Texas or <br />its political subdivisions or by any organization owned, <br />operated or directed by a political subdivision of the <br />State of Texas. <br /> <br />(f) Owned/Leased Facilities. If a leased facility is granted <br />abatement the agreement shall be executed with the lessor <br />and the lessee. <br /> <br />(g) Value and Term of Abatement. Abatement shall be granted <br />effective with the January 1 valuation date immediately <br />following the date of execution of the agreement. One <br />hundred percent of the value of new eligible properties <br />shall be abated for up to two years during the period of <br />construction and for five years thereafter. If the period <br />of construction exceeds two years the facility shall be <br />considered completed for purposes of abatement and in no <br />case shall the period of abatement inclusive of <br />construction and completion exceed seven years. <br /> <br />If a modernization project includes facility replacement, <br />the abated value shall be the value of the new unit(s) less <br />the value of the old unit(s) . <br /> <br />(h) Economic Qualification. In order to be eligible for <br />designation as a reinvestment zone and receive tax <br />abatement the planned improvement: <br />(1) must be reasonably expected to increase the value of <br />the property in the amount of $5 million after the <br />period of abatement has been expired; <br /> <br />- 4 - <br />