Commissioner outlines requirements for her approval of Apple incentive

Travis County Commissioner Sarah Eckhardt has requested that Apple Inc. agree to some conditions before she signs off on a tax rebate that could reach $7 million over 10 years for the Cupertino, Calif.–based computer company.

In a March 29 statement, Eckhardt said she has asked Apple to guarantee that the 3,600 new jobs the company expects to create if it expands in Austin would be predominately filled by Travis County residents; that the company reach out to, hire and train economically disadvantaged residents; and that it help pay for a stop on the Lone Star Rail line that would service the new campus.

Apple has proposed building a new operations center on a 31-acre tract of land at Parmer Lane and Delcour Drive that is adjacent to it existing Northwest Austin campus at 12545 Riata Vista Circle. Lone Star Rail is a regional rail line in the planning stages that would run from Georgetown to San Antonio.

"In the last 72 hours, I have been encouraged by communications from Apple that it is seriously considering my proposals," Eckhardt said. "I will therefore seriously consider its rebate rather than rejecting it out-of-hand as poor public policy guaranteeing a tax holiday for the wealthiest among us.".

Eckhardt is one of five Travis County commissioners who will likely vote on the rebate at an April 3 meeting.

The county rebate would coincide with an $8.6 million tax rebate from the City of Austin, which council unanimously approved March 22. In exchange for the city incentive, Apple agreed to keep its existing 3,100-person workforce at its Riata Vista Circle campus, hire 3,600 new employees, build a $243 million new campus in two phases by Dec. 31, 2021, and adhere to state and federal laws regarding safety and minimum wage for workers hired to build the campus.

Apple is also in line to receive $21 million from the Texas Enterprise Fund, which is used to attract businesses but requires that Texas must be competing against another state to be the location of the expansion. According to city documents, Apple is also considering locating the center in Phoenix.

However, prior to approval from City Council, some citizens expressed concern that the rebates were not incentives, but gifts and that Apple was not truly considering Phoenix as an alternative.

Resident Brad Parsons told City Council there were reports in Phoenix that Austin was the only location being seriously evaluated.

"Literally, Apple earns in a few seconds what you all are offering," he said. "This is not a true incentive. Apple does not need nor deserve these proposed tax giveaways over 10 years in order to decide whether to expand their footprint already in Austin."

Kevin Johns, director of economic growth and redevelopment services for the city, said it is difficult to confirm if a business is considering other locations, so instead the city places emphasis on how much it could make from the deal. Johns said in this case, the city expects to net $14.6 million over 14 years.

Eckhardt has gone on the record with concerns about Apple's need for the rebate and in the statement addressed claims that Phoenix was not an actual competitor.

"Even if Phoenix is or was a serious contender for Apple's expansion plans, a bidding war between Phoenix and Austin serves only to guarantee that Apple will receive preferential tax treatment wherever it locates, not because Apple needs it, but because Apple commands it," she said. But, she added, "I am willing to overlook the weakness in the 'competitive site' argument if Apple helps the county achieve some public good that the market isn't supplying on its own."


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