The Lufkin Daily News
By JESS HUFF/The Lufkin Daily News
January 11, 2023

The Lufkin Economic Development Corporation 4B Board of Directors approved tax abatements Tuesday for two companies building facilities within the city.

The board approved a 10-year tapered tax abatement agreement with the STI Group, doing business as Texas Star Industrial Manufacturing LLC.

“The STI Group is a fantastic group of entrepreneurs down in Bridge City, Texas,” Lufkin EDC director Bob Samford said.

The agreement offers the company a tax abatement for 10 years that tapers over time, starting with 100% in the first three years and graduating down to 30% at the end of 10 years. The company currently employs 1,000 employees but plans to add 75 jobs in the fabrication plant it will establish in Lufkin. It will invest $4 million into the former Lufkin Gears site on Industrial Drive.

The company serves a wide customer base involved in oil and gas, petrochemicals, aerospace, pulp and paper and power generation.

“Our customer base is expanding with the rebound of the United State economy, and while we have many options where we could locate these new employees, at the end of the day we want to expand our company in Lufkin, Texas,” said Paul Spence, CEO of the STI group.

“Lufkin has a talented and diverse workforce, and STI wants to be an economic contributor to the city’s success by locating our newest facility in this growing area of Texas.”

Among the jobs created in this facility, STI will create welding fabrication jobs, something Samford hopes will encourage Lufkin’s younger residents chasing oilfield jobs to stay at home.

“Now they can come back and have a good job here in Lufkin,” he said.

The company should have the work completed and be hiring employees by 2024, Samford said.

The group also approved a tax abatement for Jefferson Enterprise Energy LLC. Jefferson was first introduced to the city in January 2021 with a plan to revitalize the old Aspen Power Plant property. However, their goals have changed and expanded, and the company needed to purchase more land to accommodate this.

The company and the city of Lufkin hit snags along the road as they have tried to revamp the tax abatement agreement with the company to better suit the company’s goals. This abatement proposal solves those issues, Samford said.

The tax abatement will last 10 years at 100%. That means the company will pay taxes on the current land value of the property but not on any improvements made. After 10 years, the company will pay taxes based on the appraised value.

Jefferson will invest a minimum of $250 million into the site and plans to hire 100 full-time employees to run an agro-pulp mill and manufacturing facility. The facility will create products using natural ingredients with the intent of disrupting the plastics industry, the company and its partner company, Zume, announced in July 2021.

“Jefferson Energy’s innovative project will create quality jobs and inject a substantial amount of taxable value and spin-off jobs in Lufkin, Texas, and the Lufkin Economic Board looks forward to the completion of the project,” Samford said.

The company will break ground in the first quarter of 2024, he said. He has seen some of their engineering plans and is excited about this.