GRIMES COUNTY, Texas (KBTX) – SpaceX has officially signed its tax abatement agreement with Grimes County, making the proposed Terafab chip manufacturing facility one step closer to becoming a reality.
SpaceX CFO Bret Johnsen signed the agreement, joining Grimes County Judge Joe Fauth, whose signature has been on the document since June 3. The deal is now fully executed.
With both signatures in place, SpaceX is now legally committed to invest at least $5 billion in Grimes County by 2030 and create at least 1,800 full-time jobs by 2035.
But also written into that same agreement, SpaceX can walk away at any time, for any reason, with just 30 days’ written notice. If the company leaves, the maximum penalty on a project worth up to $119 billion is $60 million.
Regardless of what happens next, SpaceX is required to pay Grimes County a non-refundable $10 million payment by August 2, 60 days from the agreement’s effective date of June 3.
What KBTX has learned from open records requests
KBTX filed more than 20 open records requests the same day Grimes County approved the deal, seeking answers about the project and what it could mean for the community. Here is what we have learned so far:
Iola ISD and Anderson-Shiro CISD provided documents laying out the JETI tax break agreements between the districts and SpaceX. Those agreements still need approval from both school boards and the Governor before they take effect. School board votes are expected around July 13-14. Navasota ISD confirmed it has had no contact with SpaceX and is not part of this deal.
RELATED: What documents filed with local school districts reveal about SpaceX’s Terafab project
The Bluebonnet Groundwater Conservation District told KBTX it has not received any permit request from SpaceX to drill new wells. The facility plans to draw water directly from Gibbons Creek Reservoir.
KBTX has also requested several documents from Grimes County.
When KBTX asked the county for any economic impact or feasibility analysis used to justify the tax break, the county said no such document exists.
When KBTX asked for outside legal counsel contracts and invoices, the county again said no responsive documents exist. However, Judge Fauth clarified directly that the county does have an outside attorney, and that SpaceX is paying for that legal representation through the agreement itself, to the tune of $35,000.
National corporate site selection consultant John Boyd, who has worked on major economic development projects across the country, told KBTX that independent legal and economic analysis is standard practice for deals of this scale.
“For projects of this enormous scale, it is normal for counties and the public sector to be represented by independent third parties with respect to legal, environmental, and engineering — as well as an independent economic impact analysis — to really protect the taxpayer and scrutinize some of the company projections,” Boyd said.
Remaining documents: Grimes County has asked KBTX to pay a fee to obtain additional records. The county initially quoted more than $400 before reducing that estimate to $180. KBTX has agreed to pay that fee, and those documents are expected soon.
What’s next
School district votes on the JETI agreements are expected around July 13-14 for both Iola ISD and Anderson-Shiro CISD. The Governor must also approve before those agreements take effect.
KBTX will continue to follow this story as those responses and votes come in.
RELATED: Big promises, fine print: What SpaceX’s IPO filing actually says about Terafab
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