The Allen Economic Development Corporation (AEDC) has negotiated the recruitment of NetScout Systems Texas, LLC to locate in Watters Creek Office Park near the northwest corner of Bethany Drive and US 75.  The company will lease over 145,000-square feet of space in a new three story office building to be constructed on the northern portion of the office park.

NetScout plans to relocate approximately 540 employees with an average annual salary of $138,000 to the facility and cause construction of a new building with an investment in real and business personal property estimated at $55 million. The project is estimated to generate over $12.3 million in tax revenues to local taxing entities over the next 10 years, based on an economic impact analysis completed by the AEDC.   

The AEDC Board of Directors authorized an economic development incentive from the AEDC to assist with the project.  During the course of negotiations, it was determined that a Chapter 380 Economic Development Incentive Agreement from the City of Allen to provide the equivalent of a 10 year, 50% tax abatement would play a critical role in recruiting the project to Allen.

Based on a minimum required taxable value of $40 million, annual property tax revenue generated by the project to the City of Allen is estimated to be $208,000. The annual reimbursement from the City of Allen to NetScout in the form of this Chapter 380 Economic Development Incentive Agreement (equivalent to a tax abatement) is estimated at $104,000 per year.

Staff recommends authorizing the City Manager to execute an Economic Development Incentive Agreement with NetScout Systems Texas, LLC.

I make a motion to authorize the City Manager to execute an Economic Development Incentive Agreement with NetScout Systems Texas, LLC.