LUFKIN, TX (KTRE) - A deal worked out between the Lufkin B4 Economic corporation and the PID group have officials pointing to an improving economy.
In a special called economic meeting, the board agreed to move forward with an incentive package for the company that has begun making pumping units from their facility in south Lufkin.
In the meeting, Economic Director Steve Floyd announced the board had come to an agreement on what was only being called "project pump." The economic board agreed to give PID a low-interest infrastructure loan on $1 million that will go to purchasing equipment to be able to make their own gears in the facility.
"This is work that we are currently outsourcing out of town and this will give us the ability to do the work in our factory,"said PID CEO Scott Slusher. "This is big and good for us."
Floyd said the loan payment period will take place over 15 years and will have no interest for the first 18 months and then low interest for the remainder of the payment period. The group must start paying off the loan starting on June 1, 2018. Floyd said that after 18 months, if PID shows improvement to industry market share or shows large growth, the corporation could grant an additional $400,000 loan that would be added to the $1 million loan. Floyd added the loan will include an incentive of a grant that would give the company $4,000 per employee for the first five years of operation at the Lufkin facility. The company can also be eligible for an additional performance grant of $60,000 if the company hires 15 new employees for the consecutive months by the end of 2017.
Slusher said the new equipment will bring new cross-training for employees but will also bring new jobs.
"As we are adding equipment, and our work is increasing, we will need to add additional employees to support the work," Slusher said.
Floyd believes that the deal is just one of several coming up that could jump start the economy and help Lufkin grow. In recent numbers released by the Texas comptroller, Lufkin saw a 8 percent sales tax revenue increase compared to the month last year and is seeing a 2 percent increase for the overall year.
"We're surprised that they continue to be up," Floyd said. "It just shows that our economy is strong even though the major layoffs that we have. We think this is only going to help increase those sales tax numbers."
The board is currently working on more projects and hope more businesses will move in or start up. With plenty of space in the city's business park and retail centers, board members feel the city is moving in the right direction.
"We are competing with every other community in Texas especially to try and recruit new businesses, but we are as competitive as we can be," Economic Board Member Phillip Medford said.
Floyd said Lufkin City Council will have to approve the package for PID at the upcoming city council meeting on Oct. 18.