Tax Abatement Sweetens Pot For Expanding Specialty Machine Shop
by FortBob
01:40 PM, Wednesday, February 22
Engelbrecht Manufacturing Inc. will move to a new facility, and expects to double or triple its workforce over the next two years. As an incentive for keeping the precision machine shop in Rosenberg, the City Council voted Tuesday night to provide a five-year tax abatement.

Engelbrecht, which specializes in machining complex geometrics, critical tolerances and exotic materials, plans on building a 19,500-square-foot shop building and 2,250-square-foot offices. The new headquarters, located on Bamore Drive in the Bamore Commercial Center, is expected to be complete in July.

According to material prepared for the council by city staff, Engelbrecht plans to add major new fixed equipment, which qualifies for the city's tax abatement program. The value of the new building, current and new equipment totals about $1.7 million.

Also, a report from the city staff shows the company expects to expand from its current workforce of 18 employs to somewhere between 42 and 63 employees within the next two years, as a result of the expansion. Twenty to 40 of those jobs would be for highly skilled machinists.

City figures show the company's hourly wage rate ranges from $15 to $22 per hour, and its new annual payroll would range from $1.2 million to $2.4 million per year. City reports also show Engelbrecht would receive tax abatements no more favorable than those granted to four other businesses in recent years that did not produce as many new jobs.

The tax break to Engelbrecht will come in the form of savings on ad valorem taxes on its building, property, equipment and inventory. According to the agreement, granted by the council to the company Tuesday night after an executive session, Engelbrecht will receive a 100% abatement for the first three years of the program, a 50% abatement during the fourth year, and a 24% abatement for the fifth year.

Rosenberg Mayor Joe Gurecky said the company might realize a total savings of $12,000 to $15,000 as a result of the abatement.

"They're landlocked. They had a choice" of relocating anywhere in the region, Gurecky said. "By giving them a small abatement, they'll relocate in our city."

He said he's happy with the idea of providing five years of tax breaks in return for 50 years of increased taxes coming from a business expansion.

Rosenberg City Council also agreed to accelerate zoning and permitting procedures for Engelbrecht.

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