Firm ditches SMART Terminal for Hays County location

Caldwell County’s loss appears to be Hays County’s gain.

The news last week that Katerra, a California-based manufacturer of home components, has decided to relocate from the planned SMART (San Marcos Air, Rail and Truck) Terminal in Caldwell County to a site adjacent to Interstate 35 in Hays County came as a surprise to many.

But according to a spokesman for the company, it was simply a business decision.

“Katerra has long believed that San Marcos is a good fit for the new facility,” said Angela Ewert, of Katerra’s Government & Regulatory Affairs. “Once the determination was made that we no longer required a rail-served site, Katerra explored other options that would keep us in San Marcos.”

The site chosen is in the Whisper development, a proposed blend of homes, commercial and manufacturing with easy access to I-35. “Whisper best suited our needs,” Ewert said.

On Oct. 2, Hays County Commissioners gave their unanimous okay to a Chapter 381 agreement with Katerra that lays out incentives.

Under the agreement, copies of which have not yet been made available, performance-based incentives apply to both real property – meaning the land on which the facility will be built, and personal property – movable assets like equipment. According to John Ellis, vice president for Marketing and Communication for the Greater San Marcos Partnership (GSMP), Katerra would get a 30 percent rebate on its real property taxes for the first three years of the 10-year agreement, a 20 percent rebate for years four through six and a 10 percent rebate for the remaining four years.

Rebates for personal property would be 80 percent for the first three years, 70 percent for the next three and 60 percent for the remaining four. The rebates are contingent upon Katerra living up to its end of the bargain, Ellis said.

Over the course of the agreement the county is expected to receive more than $1.9 million in new tax revenue.

Although the 380 agreement the company signed with the city of San Marcos when it was still planning for the SMART Terminal site mandated the company provide at least 542 full-time jobs at a wage of at least $15 per hour, Katerra’s deal with the county specifies it will hire at least 530 employees, also at wages of at least $15 hourly.

The move should not jeopardize the eventual development of the SMART Terminal, according to Jason Guilietti also of the GSMP. Though more than six months have passed since the city of San Marcos annexed the acreage and zoned it Heavy Industrial, there’s been no physical activity at the site, located near the intersection of State Highway 80 and FM 1984.

“The SMART Terminal is a tremendous asset for us and will still go on as planned,” Guilietti said. “We continue to market the opportunity and there are currently several prospects that are considering the property … we don’t have anything signed but the activity level is there,” something he called a “very positive sign.”

Though It will not be physically located in Caldwell County, Guilietti said the county will still stand to benefit because it’s likely Katerra will hire residents from both Hays and Caldwell counties.

“At the end of the day the counties showed partnership in working together for the betterment of the region.”

The GSMP is a public/private initiative that was instrumental in formulating the concept of the industrial park. Though the name refers to air, rail and truck traffic, the site, which is adjacent to San Marcos Regional Airport, would require the construction of a new rail line as well as the completion of that leg of FM 110. Ground for that roadway was just broken last week.

Ewert did not respond to addition questions, including a timeline for the beginning of construction or when the company might achieve the stage of beginning to hire.

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