July 23, 2024
Investment

Filing records reveal tech company behind major $10 billion RELLIS Campus investment


BRYAN, Texas (KBTX) – Filing records with the Texas Comptroller’s office reveal that Substrate Inc., a San Francisco-based tech startup, is planning a monumental $10 billion investment on Texas A&M’s RELLIS Campus.

An LLC application filed with the Texas Secretary of State shows that the proposed facility is an extension of Substrate Inc., with a registered address at a post office in San Francisco.

This project, operating under the name America’s Foundry Bryan, LLC/ Project Factory One is said to be the first of its kind in the United States, focusing on cutting-edge semiconductor manufacturing and is expected to bring significant economic benefits to the Brazos Valley.

This venture promises a transformative $10 billion investment in the Brazos Valley. According to the recently released documents, Substrate Inc. appears to be led by CEO James Proud, who is known for his work with tech startups such as Hello and Config. According to online records, Hello built sleep tracking software, but shut down in 2017 when it couldn’t find a buyer. Config builds software to manage the process of hardware development.

The City of Bryan, Brazos County, Bryan ISD, and Texas A&M have all approved a series of tax incentives to secure this significant investment, which triumphed over 15 other states in the competitive site selection process. Since the announcement of the proposed tax incentives, local agencies and municipalities have been tight-lipped about the deal, citing a non-disclosure agreement but didn’t shy away from sharing their thoughts on the idea of this company coming to Aggieland.

“I think it’s the biggest thing to come to Brazos County since A&M was put here. If this winds up happening,” Texas A&M Chancellor John Sharp said. “There’ll be about 1,800 at least permanent jobs here. Much more than that obviously in the construction phase. And it’s a minimum $10 billion investment.”

“This is a game-changing project for Bryan,” said Mayor Bobby Gutierrez. “We’re doing everything we can to get it here. The economic benefits and job creation potential are enormous.”

Construction on the 288-acre site at the RELLIS Campus is expected to begin this year and be completed by 2029. The facility is projected to create over $100 billion in economic impact over the next 40 years, including 800 construction jobs initially and a total employment of 2,000 people once operational.

Economic Impact and Construction Timeline

Construction on the 288-acre site at the RELLIS Campus is slated to begin this year, with completion projected for 2029. The facility, dubbed Project Factory One, is expected to bring an economic impact of over $100 billion over the next 40 years. This includes 800 construction jobs over the next six years and an eventual total employment of 2,000 people.

The project’s economic benefits include significant increases in local and state GDP, with substantial new revenues for businesses.

“It’s not just going to be a game changer for Brazos County and the City of Bryan, but it’s gonna be a game changer for the United States. This is an absolutely amazing project,” Sharp added.

Competitive Edge

The project’s approval follows a competitive site selection process, which saw Substrate Inc. evaluating potential locations across the United States. Texas, Oregon, and New York were the final contenders, with Texas ultimately winning out due to its attractive tax incentives and strategic location.

“They’ve looked in 16 different states and they decided on Bryan, Texas, and decided on the RELLIS campus along with the hypersonics, along with autonomous vehicles, the Pentagon research that’s going on there, the testing the defense space, things like that,” Sharp added.

Online records indicate that Texas and the RELLIS Campus stood out in Substrate Inc.’s site selection process due to several compelling factors. The state’s favorable tax environment, robust transportation infrastructure, and strategic location at Texas A&M’s RELLIS Campus provided a significant edge. Texas offered substantial incentives, including competitive property tax rates with the Joint Enterprise Tax Incentive (JETI) program, making it an attractive option over other states like Oregon and New York.

The advanced research and development capabilities at the RELLIS Campus, combined with a collaborative partnership with Texas A&M University, further solidified Texas as the preferred location. This partnership, outlined in a non-binding memorandum of understanding, promised mutual benefits and aligned with Substrate Inc.’s goals of leveraging cutting-edge manufacturing methods and employing a skilled workforce. These factors collectively made Texas the standout choice for Substrate Inc.’s groundbreaking semiconductor manufacturing facility.

Tax Incentives

City of Bryan Economic Development Senior Advisor Todd McDaniel highlighted the financial benefits during a recent city council meeting.

“In year one, the projected guaranteed value is a hundred million dollars. With an 80% tax abatement, that obviously grows as the project develops over the next 10 years,” said McDaniel.

According to tax abatement agreements filed in the City of Bryan the City’s projected new ad valorem tax revenue, based on the guaranteed value and after annual abatement, is $124,800 in the first year, reaching $31.2 million annually from years seven to ten. For perspective, the Brazos Central Appraisal District’s 2024 estimate of net taxable value for the City is $9.9 billion.

“The projected guaranteed value is a hundred million dollars with an 80% tax abatement that obviously grows as the project develops over the next 10 years. Finishing up at really in year seven, an estimated 10 billion of guaranteed value at a 50% tax abate,” McDaniel added.

America’s Foundry Bryan LLC plans to leverage several funding sources, including the Texas Semiconductor Innovation Fund, Texas Enterprise Fund, and the federal CHIPS Incentive Program, to support its operations.

Property and Investment Details

According to online records, the application for the construction and operation of an advanced semiconductor manufacturing facility by America’s Foundry Bryan encompasses various property and investment details.

  • Land Improvements: Extensive enhancements and preparations of undeveloped land to facilitate new construction.
  • 3 Million Sq Ft Advanced Semiconductor Manufacturing Facility: Includes administrative buildings, central utility buildings, infrastructure, a machine shop, receiving and warehousing facilities, as well as site and roadway infrastructure.
  • Processing Equipment and Tools: Acquisition of all necessary machinery and tools essential for semiconductor manufacturing.
  • Materials and Equipment: Procurement of materials and equipment to support manufacturing operations in auxiliary buildings.
  • Tangible Assets: Acquisition of any additional assets crucial for or supporting the manufacturing process.

What’s Next

Online records show that if all goes well, construction of Substrate Inc.’s semiconductor manufacturing facility is set to begin in the fourth quarter of 2024, with an anticipated completion date in 2028. The commercial operations are projected to commence in 2030, marking the first year of the incentive period. This significant development will be monitored closely, as it promises to bring substantial economic growth and job opportunities to the Brazos Valley.

Online Public Records



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