Laredo City Council approves a tax treaty for a 2,000 hectare logistics park


Laredo City Council decided last week to enter into a preliminary public-private partnership with a commercial real estate developer to build a $ 1 billion business park on Interstate 35, a 2,000-acre business park.

In 2015, Majestic Realty bought the former Mercedes-Benz test track near mile marker 13 and developed a logistics park planned by the master called Port Grande. They completed the first phase of this project in 2017 and developed 100 acres of warehouse for several large logistics companies and customs brokers.

For the past three years, Majestic Realty has worked with the City of Laredo to negotiate a proposal for an incremental reinvestment zone for subsequent development phases.

In a tax increase reinvestment zone, a portion of the developer’s taxes are reserved for the city during the contract period to invest in the infrastructure and public improvements required in the development process.

In this case the duration of the contract is 30 years. The city will continue to levy taxes based on the property’s current value. As the property develops and its value increases over the years, the city will share the new tax revenue with the developer, keep 45% for the general fund and invest 55% back in the project.

Over 30 years, the city is expected to generate $ 51 million in revenue and spend $ 53 million on building public infrastructure in the logistics park, such as five-lane roads built to accommodate heavy trucks, Teclo Garcia said , Director of economic development for the city.

When the deal expires in 2051, Laredo City will levy taxes on the full value of the development.

Port Grande’s Phase 1 created 3,000 jobs, the city reported. Councilor Marte Martinez said this deal will create 1,000 more jobs and a total of 9,000 jobs over the next three years. This is the largest project the city has ever been involved in, he said.

City manager Robert Eads noted that this deal also signs Majestic Realty to Laredo.

“For the next 30 years we will be on the hip as partners in this endeavor,” said Eads.

Councilor Alyssa Cigarroa asked the city to present this project to the city’s economic development committee. And councilor Vanessa Perez wanted to make sure the development did not create additional traffic or bottlenecks in Laredo. There needs to be traffic impact analysis to ensure the city can cope with the increase in movement, she said.

In fact, the tax treaty requires the developer to address traffic issues before launch, Eads said.

The council has yet to cast a few votes on this project before the city finalizes an official agreement with Majestic. You’ll need to draft a regulation, hold a public hearing, set up a TIRZ board, hear the budget, and then agree to the full development agreement. This should be completed by May of this year.

Majestic will also appeal to the Webb County Commissioners Court to apply for their participation in the tax treaty.

Julia Wallace can be reached at 956-728-2543 or [email protected]


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