The city of Round Rock, Texas made big business news this week, having announced two significant economic development deals, one of which involves bolstering the Texas biotech sector. The two incentive agreements, which were approved by the Round Rock City Council on Thursday, Nov. 12th, will bring at least $14 million in new capital investment to the city, as well 75 to 90 new jobs. The agreements involve the relocation of the California-based sauna manufacturer ThermaSol’s world headquarters to Round Rock, as well as a major expansion deal for local Insys Therapeutics, which will significantly expand its operations by 400 percent in the city, thanks to the new incentives.
As a result of receiving the new funding from the city, Insys, which currently employs 11 people at its manufacturing facility in Round Rock, will move to a much larger, 53,000-square-foot facility next month. The move, which is planned to be fully completed by August of 2014, will enable the company to hire an additional 30 workers over the next four years at an average salary of $50,000, thus increasing the company’s operations by 400 percent in total. Insys’ minimum total investment for the expansion will be $10.5 million.
The company, whose headquarters is currently located in Arizona, had definitive plans for expanding its operations, though Bryan Waltrip, Insys’ Director of Operations, admitted that they weren’t quite sure where the growth would take place. The decision to focus on expansion around Austin was mainly a result of the highly trained staff who are already located there, as well as the company’s proximity to Austin’s biotech and life sciences educational corridor: “As a manufacturing facility, we will have other businesses located near 2700 Oakmont that reflect similar technologies,” Waltrip said. “Additionally, we are excited to be near an area with continued growth in the educational sector with the recent additions of Austin Community College, Texas State University – Round Rock, and Texas A&M Health Science Center.”
For their part, the city of Round Rock offered key incentives for the expansion, which included a five-year property tax abatement beginning in 2015 for 100 percent in year one, 75 percent in year two, and 50 percent in years three through five; $150,000 for capital expenditures, and $50,000 for job creation over a four-year period. The payback to the City in economic impact from this project is estimated at 3.5 years, according to a recent press release.
Bryant Smith, Chair of the Round Rock Chamber of Commerce and Economic Development Partnership, specifically pointed to the significance of Round rock’s commitment to investing in the Texas biotech sector: “Bioscience is one of our major industry clusters and target industries here in Round Rock,” adding that, “This type of facility is a great compliment to the businesses already in the area and their expansion will help develop the foundation we are building for future growth in the bioscience industry.”