Tax Abatement, Letter of Intent Approved by Crockett City Council
By Will Johnson
CROCKETT – Even though nothing has been set it stone – if everything breaks just right – the city of Crockett may well be standing on the precipice of an economic boom.
During a dreary afternoon meeting of the Crockett City Council, held on Friday, Jan. 11, a ray of sunshine appeared in the council chambers as the city leaders moved forward in the hopes of bringing two new businesses to town.
The first business discussed by the council was a company known as Midland Estates, LLC, aka Texas Futura. Midland Estates/Texas Futura, LLC is a used oil re-refinery company which plans to build a facility in the Crockett Industrial Park.
According to an executive summary on the projected economic impact of the company, “Texas Futura is a planned waste-oil re-refinery facility in the Crockett Industrial Park. The facility, on about four acres of land will consist of 2,000 square feet of office space; 3,000 square feet for a control tower, employee breakroom, restrooms, etc.; 7,500 square feet for refinery operations and another 5,000 square feet of space for storage tanks.”
Crockett City Administrator John Angerstein said originally the company had proposed a 10-year tax abatement but the 10-year timeframe was not acceptable to the Houston County Commissioners Court.
“They did say they would be open to a five-year abatement with the potential to revisit the agreement after five years have passed. This is the first phase of the abatement but we wouldn’t be committed to the second phase after five years,” Angerstein stressed.
Precinct One Councilman Butch Calvert clarified the company would initially bring in 10 direct and approximately seven indirect jobs. The indirect jobs would positions such as electricians, truck drivers and various contract employees.
A motion to approve the abatement was made by Precinct Two Councilman Darrell Jones, seconded by Precinct Three Councilman Ernest Jackson and unanimously approved.
The abatement calls for a 100 percent abatement for the first two years, 80 percent for years three and four while year five is at the 60 percent mark.
Following the tax abatement approval, Mayor Joni Clonts moved the council into executive session to discuss the lease, exchange and value of Angelina College (AC).
During the closed door portion of the meeting both Karthik Sundaram (Texas Futura VP of Operations and Sales) and Nelson Varughese (Texas Futura VP of Admin. and HR) were asked what purpose the company’s two names served.
“It is two different entities for tax purposes,” Sundaram said. “Our attorney recommended we do this for legal protection and tax purposes.”
After nearly an hour, the council emerged from behind closed doors to reconvene the open portion of the meeting.
Following a few brief formalities, Jackson made a motion to “… allow Mr. Angerstein and Mr. (Crockett Economic and Industrial Development Corporation Executive Director James) Gentry to work together for Provalus to prepare a letter of intent.”
The motion was seconded and unanimously approved. With no further business, the meeting was adjourned.
During December of 2018, Angerstein indicated a call center was thinking about locating a facility in Crockett.
“They are wanting to meet the public and see what kind of potential employee base is available to staff a call center. They are wanting to start out with 75 to 100 jobs by April,” Angerstein said at that time. “They are looking for potential employees and they want to see what the aptitude of our workforce is.”
While the company initially attempted to keep its name a secret, it was learned the company’s name is Provalus.
According to the Provalus website, “Last year, $88.9 billion dollars were spent on outsourcing projects. Provalus is on a mission to bring those funds into our economy while transforming entire communities in the process. We started in rural Alabama, and we’ve only just begun. Provalus is elevating under-served communities by providing technology, business and support positions to untapped talent in the U.S. Our services provide companies the dependable, quality and practical services they need… straight from the heart of America.”
As meeting attendees were leaving the council chambers, Angerstein was asked – in general – what was discussed in executive session.
“The meeting was in regard to what we needed to put in the draft of the letter of intent. I needed to get some type of idea from the council about what value we are assigning this (AC campus.) No action was taken on selling the thing. We just need to know what value to assign in order to develop my letter of intent,” Angerstein said.
Questioned about the assigned value, the city administrator said it was still left open “… for me to develop the letter of intent. Right now, we have a little over $2.5 million to pay on the facility. I just need to make it an attractive enough offer to attract a company.”
Angerstein added the letter of intent discussed allowing Provalus to move into the AC facility.
Specifically asked if Provalus had made their choice between Crockett and Jasper, Angerstein replied they had not.
“They are coming in next week. We will probably get an indication of which way they are leaning. That’s why we are trying to hammer out a letter of intent. Another city has jumped into the mix now,” he added.
Concerning the appearance of playing one city against the others, Angerstein replied, “They have something to offer and East Texas is wanting jobs. They are a capitalist, for-profit company and while they are not looking for hand-outs, they are looking to make sure they can land a good deal with a city that’s ready to partner with them.”
Will Johnson may be contacted via e-mail at email@example.com.