Edinburg construction figure passes $163 million
For the second consecutive month, construction activities in Edinburg were down, but the year-to-date total remains ahead of last year’s record-breaking pace, the Edinburg Economic Development Corporation has announced.
Between January and November, total construction in Edinburg passed $163 million, compared to $161 million during the same period in 2004.
For the month of November, total construction activities, which include everything from installing plumbing to building the structures, saw building permits approved for more than $6.7 million in residential and commercial construction, down from more than $12.1 million during the same month last year.
For the month of October, total construction saw building permits approved for more than $8.8 million in residential and commercial construction, down from more than $13.1 million in October 2004.
Jaime Lozano and Ector Casas were issued building permits for November’s largest projects, which were both valued at $250,000.
Lozano received a building permit for construction of a multi-family unit at 713 Logan Drive in the Sprague Landing Subdivision, while Casas was issued a building permit for a single-family residence being built at 211 Conquest Boulevard in the Shea-Val Subdivision. <>
Rafael Selgado received a building permit for the most expensive single-family residence in November, a structure being built at 3120 Hawthorne that is valued at $200,000.
Building permits are permits taken out in order to allow excavation and to protect public safety.
Building permits represent the estimated cost of construction, not the selling price.
A start in construction is defined as the beginning of excavation of the foundation for the building and is composed primarily of residential housing.
A building permit is permission issued by a city’s planning department to oversee and approve any changes to structures.
They are documents designed to guarantee that any construction work, from remodeling to demolition to building a new home or business facility, meets the city’s building codes
The building and repairs of single-family and multi-family homes dominate construction activities in the three-time All-America City.
The building permit values of the 691 new homes, which began construction from January through November 2005, total more than $61.2 million.
By comparison, the city had issued building permits for 790 single-family homes, valued at more than $67.4 million, during the same period in 2004.
For the month of November, the pace of work authorized for 46 single-family homes reached almost $4 million, down from more than $6.7 million for 84 new homes in November 2004.
Those figures do not include the construction of multi-family residential units.
Construction of multi-family residences – duplexes, triplexes, fourplexes, and apartments – reached almost $2.1 million for 19 buildings for the month of November, down from the almost $2.6 million figure attained for 32 buildings in the same month last year.
Year-to-date, almost $30.9 million worth of work on 320 multi-family homes have been approved for construction, compared to more than $35.8 million between January and November 2004 for 302 multi-family residences.
So far this year, construction has been approved for 258 duplexes, 43 triplexes or fourplexes, and 19 buildings with five or more units. <>
During the same time last year, construction was approved for 230 duplexes, 39 triplexes or fourplexes, and 33 buildings with five or more units.
For the month of November, the value of construction of new commercial buildings was reported at $450,000, down from more than $2.3 million in the same month last year.
Between January and November, the city issued building permits for almost $39.8 million in new commercial facilities, compared to almost $40.1 million during the same period last year.
In 2005, the city has issued building permits for almost $17.5 million in new non-taxable structures, such as government buildings or churches, compared to no permits for such facilities during the same period last year.
No building permits were issued in November for alterations of non-taxable structures, the same as in November 2004.
Year-to-date, the city has issued building permits for alterations, valued at almost $1.6 million on non-taxable structures, down from more than $5.4 million in the same period last year.
In November, alterations for existing commercial buildings reached more than $128,000, compared to $387,000 in the same month last year.
Year-to-date, alterations of commercial buildings total more than $9.4 million, compared to more than $7.9 million during the same period in 2004.
In November, alterations for single-family residences were valued at more than $157,000, compared to more than $60,000 for the same month last year.
Year-to-date, alterations for single-family residences have reached more than $2.6 million, compared to more than $3.3 million during the same period in 2004.
Highlights of construction in November of commercial buildings, not including multi-family residences, valued at $100,000 or more include:
• Ector Casas, 211 Conquest Boulevard ($250,000); and
• Javier García, 1102 N. Closner ($150,000).
Highlights of construction in November of multi-family residences valued at $100,000 or more include:
• Jaime Lozano, 713 Logan Drive ($250,000); <>
• Bordeaux Construction, 413 Pacific Avenue ($195,000);
• Bordeaux Construction, 2302 West Stubbs Street ($195,000);
• Felipe Aguayo, 2320 W. Stubbs Street ($184,000);
• Bordeaux Construction, 2314 W. Stubbs Street ($182,000);
• Bordeaux Construction, 2308 W. Stubbs Street ($182,000);
• Noeme Maxwell, 1908 Western Drive ($180,000);
• R&R Construction, 2304 Moonlight ($180,000);
• Rubén Gutiérrez, 2224 Moonlight ($150,000);
• José Chapa, 603 Logan Drive ($150,000);
• José Peña, 1703 Phoenix ($140,000); and
• Juan Carlos Velez, 2607 Ft. Brown Avenue ($140,000).
Highlights of construction in November of single-family residences valued at $100,000 or more include:
• Rafael Selgado, 3120 Hawthorne ($200,000);
• Jaime González, 1913 Ariel Lane ($175,000);
• José Peña, 4916 Hummer Lane ($160,000);
• Rey Benavides, 719 Sable Avenue ($150,000);
• Frank Guerrero, 1510 Armagoza ($139,899);
• David Rogers, 2340 Llano Grande Lane ($133,000);
• Joe D. and Norabel Treviño, 5313 N. Expressway 281 ($120,000);
• David Rogers, 2320 Llano Grande Lane ($117,000);
• David Rogers, 3829 Drury Drive ($116,900);
• David Rogers, 2108 Gary Lane ($116,600);
• David Rogers, 2327 Llano Grande Lane ($115,000);
• David Rogers, 1340 Kokopelli Drive ($110,900);
• Delfino Benavidez, 912 Loyola Drive ($110,000);
• David Rogers, 2319 Llano Grande Lane ($105,000);
• Jabed Khan, 312 Glasscock Avenue ($101,000); and
• Marín González, 2720 Sydney Avenue ($100,000).
Legislative Media reports on the major legislative issues that affect South Texans.
By DAVID A. DIAZ“
Edinburg’s economy approaches 19 percent improvement over retail sales during 2004
Edinburg’s retail stores registered the largest yearly increase among the major Valley cities this year in local sales tax revenue, a major indicator of a strong economy, the Edinburg Economic Development Corporation has announced.
The city’s retail economy, as measured by local sales taxes generated, has posted an almost 19 percent improvement over last year, according to the latest sales tax report released December 9 by Texas Comptroller Carole Keeton Strayhorn.
The latest monthly collection of city sales tax revenue also showed that Edinburg generated more than $913,000 in local sales taxes, up almost 13 percent over the same period last year.
The figures represent local sales tax allocations made by the state to local governments in December.
November state sales tax collections and December sales tax allocations to local governments mainly represent sales that occurred in October.
Edinburg’s annual improvement of 18.63 percent, which totals $11,509,0398.80, compares to $9,701,437.49 sent back from the state to the city treasury in 2004.
Local sales tax figures provided by the state give an accurate idea of how much taxable commercial activities, from retail to manufacturing, are going on in a community.
In Edinburg, as in most major Valley communities, the local sales tax is two percent, which includes a local one-half cent economic development sales tax.
The one-half cent economic development sales tax in Edinburg is collected by the EEDC, which is the jobs-creation arm of the Edinburg City Council.
Businesses in each city send their local and state sales tax collections to the state, and the state then sends back the cities’ local share as rebates to the respective communities.
On December 9, Edinburg was sent a monthly sales tax rebate of $913,338.39, compared to $810,292.38 during the same month last year, which resulted in a 12.72 percent improvement.
Year-to-date, the local sales tax rebates sent to all cities in Hidalgo County total $98,574,879.44, up 10.17 percent over 2004, which was reported as $89,468,215.25.
On December 9, all cities in Hidalgo County were issued monthly sales tax rebates totaling $7,775,210.46, up 14.57 percent over the same month last year, which reached $6,786,342.06.
McAllen led all Valley cities, reporting a December 9 sales tax rebate of $3,678,824.72, up 12.25 percent over the same month last year, which reached $3,277,247.19.
Year-to-date, McAllen has generated $49,423,884.06 in local sales taxes, up 7.25 percent over last year’s figure of $46,079,088.08.
Pharr placed third among Hidalgo County cities,, reporting a monthly local sales tax rebate of $846,309.39, a 10.07 percent increase from the same month in 2004, when its rebate was reported as $768,818.77.
Year-to-date, Pharr has generated $10,120,118.67 in local sales tax rebates, up 8.28 percent over the 2004 figure of $9,345,484.33.
Mission reported an $777,201.25 monthly local sales tax rebate, up 19.97 percent over the same month last year, which reached $768,818.77.
Year-to-date, Mission has generated $9,030,879.83 in local sales tax rebates, up 8.28 percent over last year’s figure of $8,072,972.49.
Weslaco reported a $594,301.07 local sales tax rebate, up 17.79 percent over the same month last year, which reached $503,
Year-to-date, Weslaco reports $7,096,507.90 in local sales tax rebates, up 6.27 percent from last year’s figure of $6,677,255.98.
Cameron County saw smaller, but still positive improvements in its local sales tax activities.
On December 9, all cities in Cameron County were sent total sales tax rebates of $3,948,017.53, up 6.46 percent over last year’s monthly report, which reached $3,708,293.66.
Year-to-date, all cities in Cameron County reported total sales tax rebates of $52,326,739.73, a 5.23 percent increase from the same period in 2004, which was reported as $49,725,630.06.
Brownsville’s latest local monthly sales tax rebate was $1,955,106.07, up only one-tenth of one percent over the same period last year, which was reported as $1,955,053.51.
Year-to-date, Brownsville has generated $26,586,987.31 in local sales tax rebates, up 4.24 percent over last year’s figure of $25,505,440.48.
Harlingen’s local monthly sales tax rebate was $1,341,591.11, up 18.95 percent over last year’s level of $1,127,856.42.
Year-to-date, Harlingen’s local sales tax rebate has reached $16,731,875.84, up 5.41 percent over the same period last year, which reached $15,872,449.34.
Upstate, where Hurricane Rita slammed into the upper gulf coast earlier this year, that region’s economy registered a dramatic improvement, said the state comptroller,
“Some Southeast Texas communities continue to see declines in their sales tax revenue as a result of Hurricane Rita, but overall state and local sales tax revenues are up significantly,” she said.
According to her office:
The state collected $1.58 billion in sales tax in November, up 9.4 percent compared to November 2004. December sales tax allocations to local governments rose by $50.8 million, or 15.8 percent, compared to December 2004. Sales tax allocations are up 19 percent in 22 counties that were declared disaster areas following Hurricane Rita.
“These sales tax numbers tell the story of Texans’ heroic response to hurricanes Katrina and Rita,” Strayhorn said. “They show the generosity of Texans who purchased millions of dollars worth of clothing, household goods and emergency supplies for those in need. And the numbers reflect spending by thousands of evacuees, who were welcomed in cities throughout Texas.
“The numbers also show that after Hurricane Rita, Southeast Texans immediately bounced back and began to repair, replace and rebuild what they lost,” Strayhorn said. “Also contributing to stronger than average sales tax growth were the mining and utility sectors.”
In the hard-hit Beaumont-Port Arthur area, Beaumont’s local sales tax allocation dropped 9 percent in November, but its December sales tax soared by 43 percent compared to December 2004. Port Arthur’s sales tax allocation dropped 12.1 percent in November, but rose 23.7 percent in December. Orange, whose sales tax allocation declined 12.3 percent in November, saw a 42.8 percent increase in December.
Only 25 local governments in 22 Southeast Texas disaster counties show declines in their December sales tax allocations, compared to 73 local governments whose sales tax revenue dropped in November. Cities, counties, special purpose taxing districts and a transit system located within the disaster area lost about $271,000 in sales tax in December, compared to losses of $2.3 million in November.
Strayhorn’s unprecedented plan to help local governments whose sales tax revenue has declined since Hurricane Rita remains in effect.
“Some towns continue to lose sales tax revenue, because they have businesses that have not been able to reopen,” Strayhorn said. “I am offering local governments an option to help them with short-term fiscal problems caused by a sudden drop in sales tax revenue.
“Local governments in disaster counties can, if they wish, receive additional sales tax allocations for November and December to make up the difference between their November and December 2005 sales tax allocations and the amount they received last November and December,” Strayhorn said.
Strayhorn sent $372.4 million in December sales tax allocations to cities, counties, transit systems and special purpose taxing districts, up 15.8 percent compared to last December.
Texas cities received $252.8 million in sales tax allocations, up
15.8 percent compared to December 2004. Texas counties received December sales tax allocations of $21.8 million, up 17.2 percent compared to one year ago. The 103 special purpose taxing districts around the state received $10.6 million in sales tax, up 22.5 percent compared to last December. Ten local transit systems received $87.1 million in December sales tax payments, up 14.6 percent compared to a year ago.
For details of December sales tax payments to individual cities, counties, transit systems and special purpose districts, locate the Monthly Sales and Use Tax Allocation Comparison Summary Reports on the Comptroller’s Web site at http://www.window.state.tx.us/taxinfo/allocsum/compsum.html.
The Comptroller’s next local sales tax allocation will be made on Friday, Jan. 13, 2006.
By DAVID A. DIAZ
Legislative Media reports on legislative issues that impact South Texans.
Governor approves Doctor’s Hospital application for enterprise zone status
A planned $150 million expansion of Doctors Hospital at Renaissance, with its first phase now underway, has been endorsed as a state enterprise zone project by Gov. Rick Perry, local state and city economic development leaders said Monday.
The designation, which was made possible by a law passed in the 1980’s by Sen. Juan “Chuy” Hinojosa, D-McAllen, could help the hospital qualify for as much as $2.5 million in state sales tax reimbursements.
Tracye McDaniel, executive director for the governor’s Economic Development and Tourism division, confirmed the state designation in a Nov. 30 letter released Monday by Hinojosa.
Doctor’s Hospital at Renaissance is one of the largest projects recommended by local communities to the governor’s office.
“It successfully competed for one of 85 projects that will be approved for state enterprise designations during the next two years,” said Hinojosa. “When I worked on this major economic development legislation almost 20 years ago, I envisioned the state government using this law to help create thousands of jobs in South Texas.”
Perry, who is up for reelection, evidently gave his endorsement to the effort as well.
“We have reviewed and herby approve a Texas enterprise project designation for the application submitted on behalf of Doctor’s Hospital at Renaissance by the City of Edinburg,” McDaniel stated. “The Project (Doctor’s Hospital) has committed that 25 percent of the Project’s new employees are required to be economically disadvantaged individuals or enterprise zone residents.”
Five hundred of the 1,096 new jobs expected to be created by the hospital complex expansion qualify for as much as a $5,000 state sales tax refund per new job, which will be refunded to Doctor’s Hospital at Renaissance.
“This designation will not be at any cost to the city nor will the city lose sales taxes,” EEDC executive director Ramiro Garza reported to the EEDC board of directors. “Edinburg will benefit with an increase in the tax base and the creation of new jobs.”
The EEDC, which is the jobs-creation arm of the Edinburg City Council, discussed the enterprise zone designation and other issues during its Monday, December 19 special meeting, which was held in the International Trade and Technology Center at the University of Texas-Pan American.
The coveted enterprise zone designation follows key endorsements earlier this year from the Edinburg City Council and the EEDC board of directors The two city governmental entities, led by Mayor Richard Garcia, unanimously approved resolutions asking the governor to designate the ultra-modern medical center as an enterprise zone project.
The landmark economic development program was created in 1983 by then Rep. and now Sen. Hinojosa and Sen. Hector Uribe, D-Brownsville.
The Texas Enterprise Zone Program is an economic development tool for local communities to partner with the state to promote job creation and capital investment in economically distressed areas of the state.
Local communities must nominate a company as an enterprise project to be eligible to participate in the Enterprise Zone Program, according to the governor’s office.
“Construction began earlier this year and will finish in the spring of 2007,” Garza said. “Doctor’s Hospital at Renaissance will create 1,096 full-time and 226 part time jobs over the next five years, with an estimated annual payroll of almost $59 million annually.”
The enterprise zone designation has previously allowed Edinburg to retain and recruit businesses such as Merkafon Teleperformance, Edinburg Regional Medical Center, and Wright III Foods, he noted.”
Since each of those company’s designation as an enterprise project, a combined total of almost 1,900 jobs have been created with an estimated increase in the tax base of more than $55 million, Garza said. The expansion of the medical center campus, which is expected to develop in phases over the next few years, is coming on top of almost $130 million in facilities already in operation at 5501 South McColl, just within the Edinburg city limits.
The expansion, which will include a hotel, medical offices, women’s and children’s hospital, nursing home, and cancer treatment facility, will take place on an empty site located right across McColl which is currently being prepared for the infrastructure needed to support the new facilities.
The $150 million expansion will include about $110 million in new construction, $31.2 million for medical machinery, $8.5 million for non-medical machinery, equipment, furniture, and fixtures, and $1.2 million for infrastructure improvements.
Edinburg first created its enterprise zone in the fall of 1989 for a seven-year term.
In 1998, the city received redesignation from the state for an addition seven-year term.
According to the Texas Comptroller of Public Accounts, some of the highlights of the enterprise zone program include:
“Tax Code 151.429 allows a qualified business, designated by the Texas Department of Economic Development as an enterprise project that is designated prior to September 1, 2001, to obtain a sales tax refund of $2,000 for each new permanent job created or retained within the project. Projects apply for refunds to the Texas Comptroller’s Department. A maximum refund of $250,000 per year is allowed for each project.
The refund can be based on:
(1) Sales tax paid on equipment or machinery sold to a project for use in the enterprise zone;
(2) Building materials sold to a project for use in remodeling, rehabilitating or constructing a structure in an enterprise zone;
(3) Labor for remodeling, rehabilitating, constructing a structure in an enterprise zone; and
(4) Electricity and natural gas purchased and consumed in the normal course of business in an enterprise zone.
An enterprise project designated on or after September 1, 2001 may obtain a sales tax refund of $5,000 for each new permanent job created or retained.
The qualifying items for a sales tax refund are the same four items (1 through 4 above) and beginning on or after September 1, 2003, an enterprise project may also claim a sales tax refund on taxes paid for tangible personal property purchased and consumed in the normal course of business in the enterprise zone and taxable services. Refund claims can be made on taxes paid for purchases for these two additional qualifying items from September 1, 2001, but the right to claim the refund will expire on August 31, 2005.
If a business that qualifies as an enterprise project enters into a new construction contract to improve realty, the contract must be separated in order for the enterprise project to obtain the refund of taxes paid on the incorporated materials. The contractor owes tax and the equipment, consumable, etc. and the enterprise zone provisions will not apply. If the contract between the contractor and the enterprise project is lump-sum new construction, the enterprise zone exemption is lost.
Effective September 1, 2003, two higher levels of enterprise zone projects were authorized–double jumbo and triple jumbo, with higher refund thresholds.
Only purchases for use in a project’s qualified business site qualify for refund.
The refund amount per job was reduced from $5,000 to $2,500 for enterprise projects other than double and triple jumbo projects designated after September 1, 2001.
New jobs created must be intended to continue for a minimum of three years after the state incentive benefit is paid.
Each fiscal year, the refund is based on the total amount of capital investment in the qualified business site.
For projects designated between September 1, 2001 and August 31, 2005, qualifying purchases are capital investments in tangible personal property and taxable services for use at the qualifying business site.
For projects designated on or after September 1, 2005, qualifying capital investments include machinery and equipment; labor and building materials used to remodel, rehabilitate, or construct a structure; and electricity and natural gas consumed in the normal course of business.
Enterprise projects can still carry forward credits, but those refunds and credits are now subject to the regular four-year statute of limitations.
Enterprise projects approved after September 1, 2003, cannot receive a refund before September 1, 2005.
The changes do not apply to defense readjustment projects or to enterprise projects designated before September 1, 2001, which are subject to the law in effect at that time.”
Legislative Media reports on the major legislative issues that affect South Texans.