Brownwood News – Early City Administrator, Tony Aaron, calls it an exciting time for Early, a big win and a game-changer for the city.

Solaris Oilfield Infrastructure, located in the City of Early, manufactures fracking silos for oilfield production.

“Their product and their model is they build fracking silos to hold sand which are leased out to drilling companies.  These silos go on-site with a technician and they keep sand going into the wells while they’re being drilled,” said Aaron.

In September of this year the City of Early finalized a negotiated agreement with Solaris to move the company sales office from Houston to Early.  “We’ve developed a really good partnership with them.  Through a lot of discussion and relationship building, in September we finalized that agreement so Solaris has moved their sales office here where they complete the orders,” Aaron said.

What that means for the City of Early, since the silos are leased items, there is local sales tax paid.

“What that means for the citizens of Early is, essentially, the sales tax that we are projecting to receive from Solaris will nearly double all of the other sales tax collected on every other business in the City of Early,” Aaron said.

In November the sales tax collection was up 67% and up 68% in December.  Aaron expects the trend to continue. The City of Early, prior to the agreement with Solaris, collected about $1.5 million annually.  “We are optimistic.  We could see this double that collection.  We do know that it is driven by the oilfield.  The stronger the oilfield is, the better those sales tax collections will be.  When the oilfield slows down the sales tax will slow down as well.  There will be some budgeting challenges.  We have to be prepared to be responsible with the funds when we have them and be prepared if we were to lose them,” Aaron said.

A portion of the agreement is for the City of Early to keep approximately 63% of the sales tax while rebating approximately 37% back to Solaris.  “Some people may go why would we give them anything?  That’s because they were doing this business somewhere else and they agreed to move it to Early and so Early is going to benefit from that.”

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Impact on Local Resident’s Property Tax

Aaron explained the sales tax received goes into the city’s general fund which pays for police and fire protection, streets, parks and recreation and city administration.  “We also pay for those services with property tax.  When the City of Early adopted the local sales tax collection of 2%, part of that was dedicated to what’s called property tax reduction.  Essentially, the more sales tax that Early brings in, the rollback rate of our property tax goes down and is designed to help push down the property tax rate,” Aaron said.

Solaris also has facilities in Monahans, Texas and Kingfisher, Oklahoma.