New billion dollar project? SISD accepts valuation limitation app for a proposed $3B Finisar expansion

The Sherman Independent School District accepted an application for a valuation limitation related to a proposed $3 billion expansion of Finisar operations in Sherman Monday night. This would mark the third time in the last two years that the district has used value limitations to entice project development in Sherman. Credit: Michael Hutchins / Herald Democrat

For Sherman, the past two years have represented a turning point as city leadership has positioned the city to become a major tech corridor for region and possibly the state. During this time, both Texas Instruments and Global Wafers have committed to multi-billion-dollar investments in new facilities, and as a result, a third tech producer may soon join them.

The Sherman Independent School District accepted an application for a Chapter 313 property tax value limitation from Finisar Sherman, for a new $3 billion silicon wafer production site. If approved, the agreement would limit the value of the project and improvements on the site for 10 years for the purpose of calculating the district’s property tax revenues.

The agreement states that Finisar Sherman, a subsidiary of Coherent, plans to build a new $3 billion silicon wafer production site adjacent to its existing facility in south Sherman. The facility would be built in a single phase and create 700 new jobs. Construction on the site could start in 2025 with production beginning in 2028. If approved, the agreement would take effect the following year and limit valuations for the next decade.

The application comes as Chapter 313 agreements, which offer school districts the ability to limit valuations for major, typically billion-dollar projects, are scheduled to sunset at the end of the year. With the deadline looming, officials with the district noted that it may be too late to get the project in before the program comes to a close.

“A project like this is tremendous for our community,” SISD Superintendent Tyson Bennett said. “We’ve just been able to experience three of these projects now coming into our community. To have essentially $38 billion dollars worth of value from the projects we’ve talked about in TI (Texas Instruments), GlobiTech and now Finisar Sherman — is amazing for our community and our economy in Sherman. That’s amazing. Our community and our economy in Sherman is booming and we’re going to see the positive impact across all areas of our community.”

In several ways, the proposed facility is similar to one GlobiTech and parent company GlobalWafers submitted 313 agreements for earlier this year, SISD representatives said. Both facilities would produce silicon wafers, a component that can later be refined into semi conductors and then into finished electronic devices. Consultants for the district noted that Finisar has already agreed to terms that were offered to GlobiTech earlier this year.

GlobalWafers officially broke ground on the first phase of its new facility last week.

Like with GlobiTech’s agreement, Sherman is facing competition from other cities that are also vying for the new facility. The agreement notes that Easton, Pennsylvania, Warren, New Jersey, and Newton Aycliffe, United Kingdom are also being considered as sites for the project.

Unlike GlobalWafers, Finisar is proposing to build its project in a single phase. This would mean that the district would be able to see the full valuation of the project on its tax rolls in 10 years as opposed to staggered across multiple decades, with each phase representing a separate 10-year agreement, Legal Services Consultant Kevin O’Hanlon said.

Also unlike GlobalWafers, Finisar faces a tight deadline for the project, as the state is expected to Sunset use of 313 agreements at the end of the month. State representatives have expressed a desire to pass a replacement program, but nothing has been put in place yet.

While there are still several days left in the year, O’Hanlon said it is past the timetable that the State Comptroller’s office said it would consider agreements.

“It is my understanding that these folks are working the Governor’s office really hard, but we are well beyond the period which the comptroller’s office says they are not going to look at any more applications,” he said. “So, we’ll wait and see what the comptroller’s office does.”

The agreement could prove to be useful even if it is not considered due to the deadline, O’Hanlon said. By filing the agreement with the comptroller’s office, the district is showing that there is still an appetite for these agreements and it would put pressure on lawmakers to find a replacement program.

“We are still trying to make the case that we need something because these projects keep coming along,” he said.

Finisar announced in late 2017 that it would be converting the former MEMC building into a production site for its vertical cave surface emiting technology, which is used in Apple products for facial recognition. Since then, the company has expanded several times to fill up unused portions of its existing building.

The city of Sherman, Grayson County and Grayson College approved abatements and incentives to Texas Instruments and GlobalWafers. None of the three taxing entities have approved any agreements with Finisar for this project as of yet.

https://www.heralddemocrat.com/2022/12/07/new-billion-dollar-project-coming-to-sherman-sisd-accepts-valuation-limitation-for-a-newly-proposed-3b-finisar-expansion/