The Stephenville City Council made a unanimous vote in favor of economic development and an expanded workforce at their Tuesday meeting.
In two separate votes, the council designated a reinvestment zone for 40 acres at 2825 West Washington Street, the site of FMC Technologies, Inc., and authorized Mayor Nancy Hunter to execute a tax abatement agreement with the local manufacturing facility.
Fernando Camuzzi, operations manager for FMC, said the proposed expansion project, which currently is in the design phase, was spurred by a high demand for FMC products used in the fracturing of formations that encase oil and gas. He said the fracturing market is currently a booming business, which is expected to continue to grow at a moderate pace.
What that means for the city of Stephenville and surrounding area is more jobs and eventually more property on tax rolls.
Camuzzi said the company estimates that the expansion project will bring 80 -100 new jobs to the city, 85 percent being machinist and assembly positions and 15 percent being dedicated to administrative and support staff with a total annual payroll of about $4.1 million.
FMC presented information to the city that said certain jobs will require a specialized skill set, meaning an estimated 50 percent of the new employees will be brought from outside of the area.
Looking at the fiscal impact, Camuzzi said an estimated $26.2 million in real and personal property will be added to the tax rolls, and approximately $64,000 in sales tax will be generated from project expenses.
The abatement approved by the council means that FMC will not be immediately taxed on the property tied to the new construction, but the company will not get a tax cut on existing property.
In explaining the process, City Administrator Mark Kaiser said the abatement allows the city to partner with industry to allow for economic development. He also said there will be no decrease seen on the tax roll or no impact on other taxpayers since the break applies to property not yet on the rolls.
"We are not hindering taxpayers but assisting them through new development," Kaiser said.
Camuzzi said project organizers estimate that $17 million will be spent on the project in 2011.
As for the appearance of the current facility, information presented to the council showed the local facility's existing 225,000 square feet will increase to 297,000. The additions and renovations will equate to 60,000 square feet of manufacturing and assembly area, 12,000 square feet of warehouse space and 4,000 square feet of new offices.
For more details on the multi-million dollar expansion project, read Sunday's edition of the Empire-Tribune.