Consider and take appropriate action to approve a Payment in Lieu Of Taxes ("PILOT") Agreement (and otherwise referred to as Foreign Trade Zone Tax Equivalency and Contribution Agreement) with Ichor Systems, Inc. and approve a Letter of Non-Objection with regard to Ichor Systems, Inc.’s application to activate a Foreign Trade Zone site. (Judge Brown & Commissioner Travillion)
Staff Report & Agenda Item Details
Ichor Systems, Inc. (Ichor) is requesting approval from US Customs and Border Protection (CBP) to activate a Foreign Trade Zone (FTZ) site in Travis County. Tariffs on goods located in an FTZ are delayed until they enter US commerce, which allows companies the opportunity to defer and, in some instances, reduce or eliminate customs duties. As a part of the application process to activate an FTZ site, CBP requires a “Letter of Non-Objection” (Letter) from the top local taxing entities for the site, including Travis County, the City of Round Rock and Round Rock Independent School District.<br><br data-pasted="true">Ichor is a global producer of advanced manufacturing and engineering systems that support the semiconductor industry. Ichor’s operations are located in leased facilities at 200 Parker Drive (Precinct 1) and 3800 Quick Hill Road (Precinct 1). It has approximately 30 employees in Travis County. The appraised value of the Company’s inventory is approximately $11.1 million, of which approximately 99% is already exempted through the Freeport Exemption.<br><br>Currently, there are four activated FTZ sites, with applications for seven additional sites in process. The approximate taxable valuation exempted for sites that are activated or in process was approximately $44.4 million in 2025. Ichor would add two active FTZ sites in Travis County if the request is ultimately approved by the CBP. <br>Activation of the sites would result in an estimated $100 impact to Travis County in 2026. However, Ichor has agreed to enter into a Payment In Lieu of Taxes (PILOT) with Travis County to offset the estimated revenue from FTZ activation.<br><br>Ichor has business personal property holdings in Travis County with valuations of $2.7 million in 2025, which would continue as taxable valuation.<br><br>Ichor has finalized the agreements with Round Rock ISD and the City of Round Rock. Williamson County is considering an item on this matter in May as well.