IP's containerboard mill in Orange, Texas, gets US$8M tax abatement over four years under deal with county; mill agrees to maintain workforce for four years and undertake project to improve mill's efficiency and safety while upgrading technology

Debra Garcia

ORANGE, Texas , May 7, 2014 (The Orange Leader) – Orange County agreed to an $8 million dollar tax abatement for Temple Inland Incorporated.

International Paper purchased the company in February 2012.

A tax abatement is a local agreement between a taxpayer and a taxing unit that exempts all or part of the increase in the value of the real property and/or tangible personal property from taxation for a period not to exceed 10 years. Tax abatements are an economic development tool available to cities, counties and special districts to attract new industries and to encourage the retention and development of existing businesses through property tax exemptions or reductions according to http://texasahead.org/

Commissioners Court met in closed session with Orange County Economic Development Corporation Bobby Fillyaw on Monday to discuss the abatement.

The court voted to enter into the agreement when it returned to open session.

Temple Inland Controller Holly Smith said the project will include improving efficiency and safety while also upgrading technology at the site.

"The improvements will start this year," Smith said.

Smith said there are over 300 employees at the location.

""Part of the agreement is for Temple Inland to maintain the number of employees during the abatement," Fillyaw said. "The abatement is $8 million for four years with the next four years of a declining percentage."

The additional four years are for 80, 60, 40 and 20 percent.

"The school system will get full taxation immediately," Fillyaw said.

The company did not qualify for school tax abatement.

"The abatement is for new investments in the facility," Fillyaw said.

The company will employ contractors for the improvements. The expected number of openings for those positions is not yet available.

Orange County Judge Carl Thibodeaux thanked the representatives for Temple Inland and the parent company International Paper for expanding in Orange County.

"Thank you for continuing to invest in Orange County," Thibodeaux said. "We appreciate the expansion here."

Temple Inland manufactures the paper to create produce boxes.

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