The Hooks Independent School District has filed a lawsuit in Bowie County District Court alleging that TexAmericas center did not fulfill an agreement made between the two and has cost the district a substantial amount of funding.
The lawsuit states, “ On or about February 25, 2019, TAC contacted the District about joining TAC in its efforts to obtain the passage of special legislation by the Texas Legislature to amend Chapter 3503 of the Special District Local Code, which would allow leased properties owned by TAC to be exempt from paying ad valorem taxes customarily assessed by the taxing entities in Bowie County, Texas (“Special Legislation”). The Special Legislation provided that a leasehold or other possessory interest granted to a person or entity by TAC or by a nonprofit corporation holding title for TAC would be exempt from paying ad valorem taxes during the period that TAC or a nonprofit corporation holding title for TAC owns the fee interest in the property. TAC represented to the District that the passage of this Special Legislation would permit TAC to implement its Paymentin- Lieu-of-Taxes program (“PILOT Program”), which would allow TAC to collect funds from its leaseholders that would have been paid as ad valorem taxes and return those payments to the District, as well as to other taxing entities. TAC represented to the District that the taxing entities would be made whole from any revenue loss as a result of the passage of Special Legislation. On February 25, 2019, Mr.Jeff Whitten, Chief Operations Officer of TAC and Vice President of the Hooks ISD Board of Trustees at that time, represented to the Board of Trustees at a duly called meeting that “those entities,” meaning the tenants or lessees of TAC properties, “would pay to TexAmericas, and TexAmericas would then cut a check to the school district in that amount.”
Hooks ISD passed a Resolution on February 25, 2019, in support of the Special Legislation and on May 31, 2019, the Special Legislation was signed into law by Governor Abbott through Senate Bill 579.
The lawsuit filed goes on to say that TAC’s intent to retain a portion of PILOT funds for its own use was never disclosed to the Hooks ISD Board of Trustees prior to the District passing its Resolution in support of TAC’s Special Legislation and that despite TAC’s promises, TAC has not implemented the PILOT Program as represented to the District.
The lawsuit further states, “TAC has not made the District whole from revenue lost as a result of the Special Legislation. Instead, TAC has created an additional revenue stream for itself, rather than making the taxing entities whole, resulting in loss of revenue for the District.”
In a press release issued in December, Hooks ISD stated, “At Hooks Independent School District, we believe in standing up for what’s right for our students and community. That’s why we’ve filed a lawsuit against TexAmericas Center and its partner organizations. They proposed a mutually beneficial partnership that we agreed to in the interests of supporting economic development in our area, but they have not followed through on their commitment. In 2019, Hooks ISD agreed to support a change in state law because TexAmericas Center assured us they would make up for any lost school tax revenue through a Payment-in-Lieu-ofTaxes (PILOT) program. They have not kept that promise, and their failure has harmed Hooks ISD. We expect more from a business that has benefited financially from this partnership with Hooks ISD and we are disappointed that TexAmericas Center has operated in a deceitful and dishonest manner.”
The district officials went on to say, “We didn’t take this step lightly, but we owe it to our students, staff, families, and taxpayers to ensure Hooks ISD students are not shortchanged through Tex-Americas Center’s scheme to divert revenue intended for schools for their corporate benefit. We will keep you informed as the case moves forward. Thank you for your continued support of your local schools and educators.”
The Tribune reached out to TexAmerica’s Executive Director and CEO Scott Norton to comment on the lawsuit filed by Hooks ISD. Norton stated, “ TexAmericas Center was genuinely surprised and disheartened to learn of the lawsuit filed by Hooks ISD. TexAmericas Center strives to generate economic opportunities which positively impact our region, including our schools. TexAmericas Center takes great pride in the work we do, relationships we foster, and results we achieve. Our staff and board have strong relationships with other school districts, educational institutions, and taxing entities that understand the fundamental longterm benefit our success is to their organizations. To put this into perspective, the PILOT program has resulted in three companies locating in the region and ultimately purchasing property at TexAmericas Center, which created jobs for our region and took property that was off the tax rolls and put it back on the tax rolls for our taxing entities. TexAmericas Center looks forward to vigorously defending itself in this meritless lawsuit.”
