After a 15-minute debate about spending incentive money to create jobs in nearby communities, the City Council approved a $152,000 grant from the Lubbock Economic Development Alliance (LEDA) for TTX, which plans to build (in phases) an almost $36 million railcar repair facility in Slaton.
LEDA, the city’s economic development arm, said grant will pay for itself in less than a year.
TTX’s project will create at least 31 new jobs, according to city documents and add more than $2 million in yearly payroll. Clifton Shaw, Slaton mayor, said it will be even more than that.
The project is expected to include 30-to-35 welders plus another 11-to-13 supervisory and office positions, Shaw said.
Lubbock Mayor McBrayer said, “I would prefer for those [incentives] to be used – utilized within the city of Lubbock for the benefit of businesses in the City of Lubbock.”
After the discussion, McBrayer voted yes. Two other council members also expressed a sense of caution about spending money outside the city before eventually voting yes.
This happened a day after the Lubbock County Commissioners passed on creating a tax abatement for the project (more on that below).
Paying for itself
Chris Rankin, LEDA vice president, said, “Those projects do have an impact on our city, on our citizens. Those folks, a lot of times, are buying homes and living in the City of Lubbock.”
LEDA’s grant comes from sales tax revenue, Rankin said, adding it’s not just the employees, but TTX itself would also contribute to Lubbock’s sales tax.
“They’re buying their equipment in the City of Lubbock and paying sales tax,” Rankin said.
“We run an impact analysis on these projects. That impact analysis had a payback to our community entities as a whole or taxing entities of 0.7 years for this particular grant,” Rankin said.
According to a written summary from LEDA, the TTX project will generate $21.9 million in taxable sales over 10 years.
Councilman Tim Collins, District 6, said, “We appreciate those folks who come from Slaton to shop with us in Lubbock. … While I understand your thoughts, mayor, I feel like we’re getting a much larger benefit from our neighboring communities than what this expense might be.”
McBrayer responded, “I guess my concern is it is a finite pool of money and I’d rather see it spent here in Lubbock than outside the city. And so that’s just my feelings on that matter.”
Jennifer Wilson, councilwoman for District 5, said she felt the same as McBrayer. She was willing to vote yes but urged caution.
“I could see how that would look like our money’s going outside of our community,” Wilson said.
Christy Martinez Garcia, councilwoman for District 1, said, “We’re not spending the money. We’re making an investment.”
What’s the project?
TTX is a railcar pooling company owned by major railroads. It offers railcar fleet services including repair and refurbishing.
When finished, TTX plans to expand its operations in Slaton to include a 72,000-square-foot facility for maintenance and/or scrapping.
In an email statement, TTX spokesman Darryl Carr said, “There is an opportunity for future expansion, allowing us to adapt and grow as needs evolve. … The facility is being built to increase the operations in Lubbock County and we are confident this will contribute positively to the community and simulate growth throughout the county.”
Slaton provided a different kind of tax incentive on Monday evening – a 10-year abatement, according to Shaw. It starts at 100 percent and goes down year-by-year to 90 percent, 80 percent and so on.
“Slaton is such a good fit for them,” Shaw said.
“They told us last night at the [Slaton] council meeting that there would be probably around 11-to-13 service salary jobs, which means supervisors – office personnel and that stuff to go along with the 30-to-35 welders,” Shaw said.
“They actually had 26 miles of track they bought so they can store their cars,” Shaw said.
Jason Corley, county commissioner for Precinct 2, including Slaton, said that’s enough track to store 1,300 or more cars.
“The rail cars sitting out there are worth $80,000 to $100,000 a piece. With Lubbock [County’s] tax rate, that’s $460,000 a year. That’s why I was fully in support of this,” Corley said.
Property tax includes how much inventory a company has on its site January 1.
LEDA Summary (click to show)
Source: LEDA
TTX Company is a privately held corporation that provides its owner-railroads with standardized fleets of intermodal, automotive and general equipment railcars. The company operates a network of maintenance facilities across 26 states in North America.
This project represents TTX’s strategic investment in Slaton’s industrial base, delivering job creation, infrastructure improvements, and increased economic activity. The combination of private capital investment, high-quality employment opportunities, and sustained operational spending positions TTX’s development as a strong contributor to the city’s long-term economic vitality.
As part of this expansion, the company will invest $35.8 million in its repair station operations, including infrastructure improvements, equipment purchases, and other capital expenses necessary to support long-term growth. According to Impact DataSource projections, the Project’s operations will support employment and generate broader economic activity within the community. The 31 workers directly employed by the Project are expected to earn approximately $22 million in total wages over the next 10 years. This direct activity will support indirect and induced workers in the community, earning an additional $15.8 million in wages over the next 10 years.
When accounting for taxable sales and purchases associated with the Project, including business activity, employee spending, and related economic activity, the Project is estimated to support approximately $21.9 million in taxable sales over the same period.
From a fiscal perspective, the Project is projected to generate an estimated $7.84 million in benefits to the applicable taxing jurisdictions over the next 10 years.
*The economic and fiscal impacts outlined above are based on projections prepared by Impact DataSource using its Total Impact™ model. This analysis incorporates company-provided data, along with local rates and assumptions specific to Lubbock County, to estimate the Project’s overall effect on the regional economy.
Earnings impact reflects the total compensation paid to employees, including wages, salaries, and benefits. Value added impact, or the Project’s contribution to Lubbock County’s Gross Regional Product, represents the additional economic value created through operations, including earnings, taxes, and business profits, and is calculated as revenue less the cost of external goods and services.
The fiscal impact analysis includes estimated taxable sales generated by business operations, employee spending, and related economic activity. Net benefits to taxing jurisdictions are expressed in present value terms, which accounts for the time value of money by discounting future revenues and costs into today’s dollars using standard discount rates for each taxing entity.
This analysis also applies industry standard multipliers from Economic Modeling Specialists International to estimate indirect and induced impacts, providing a comprehensive view of how the Project supports additional economic activity throughout the community.
Click here to read LEDA’s resolution which includes information about the project.
The county said ‘no’
At Monday’s County Comissioners Court meeting, Corley put an item on the agenda to offer a “reinvestment zone” which is the first step in doing a tax abatement for TTX.
No one seconded his motion and it died without debate.
Because there was no second and no discussion, company officials were not allowed to make a presentation to the commissioners.
Corley spoke to LubbockLights.com right after the city approved the LEDA incentive. He said he wished the county would have supported the project.
“Great facility. It’s good jobs – heavy manufacturing. That’s what we need more of – getting more businesses like TTX coming in here. That helps you build your tax base; that helps you lower your tax rate,” Corley said.
Slaton’s mayor said, “I did talk to the judge [Curtis Parrish] this morning. He came to me with his hand out, saying, ‘Are we still friends?’”
“I think they [TTX] were going to do it anyway. But it was a little disappointing that Lubbock County didn’t even allow them to speak,” Shaw said.
Correction: The district number for Tim Collins was corrected and updated.
