Under Chapter 312 of Texas Tax Code, the city of Richardson is able to designate tax abatement reinvestment zones.

Within those zones the city can negotiate agreements with property owners who apply for tax abatements, which authorize appraisal districts to reduce the assessed value of a taxpayer’s property by a percentage specified in the agreement. If the application for a tax abatement is approved by the city, the property owner pays taxes on the lower assessed value over the term of the deal.

The latest example of this type of agreement in Richardson was approved Oct. 9 by City Council. To incentivize Texas Instruments to build its $3.2 billion chip-manufacturing facility in Richardson, the city offered a 75 percent annual tax abatement on the business’s new construction as well as machinery and other equipment located within a designated tax abatement reinvestment zone at Alma and West Renner roads.