Fiscal Notes: November 2016 Page: 7
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BUSINESS INCENTIVE PROGRAMS IN TEXAS
Texas state and local governments offer a
wide variety of incentive programs designed
to retain and attract business investment.
Note: Not all of these programs will
require GASB 77 reporting; government
entities should consult with their advisors to
determine reporting obligations.
Among others, these programs include:
STATE INCENTIVES
The Skills Development Fund, established
in 1995 and administered by the Texas
Workforce Commission, provides grants to
support the development of customized
job training by partnerships between
private companies and community and
technical colleges, as well as other partners
that may include trade unions, community
organizations and local Workforce
Development Boards.
The Texas Enterprise Fund, administered
by the Economic Development & Tourism
division of the Texas Governor's Office, is
a "deal-closing" mechanism that provides
incentive funding in cases in which a Texas
site is competing with out-of-state options
for a major business development that
promises significant employment and
capital investment.93'
IF LW>
orThe Texas Enterprise Zone Program,
established in 1983, allows communities
(with state approval) to designate
economically distressed areas as "enterprise
zones"; businesses in these zones may
receive refunds of state sales and use tax in
exchange for investments and job creation.
The Texas Capital Fund Infrastructure
Development and Real Estate Programs
(INFRA/RE) provide funding to cities
and counties that can be used for public
infrastructure and real estate development
to assist businesses that create permanent
jobs.
Since 2014, Texas has offered franchise tax
deductions to companies that move their
principal place of business from another
state to Texas.
LOCAL INCENTIVES
Chapter 380 of the Texas Local Government
Code allows cities to provide loans and
grants as well as staff assistance to projects
promoting economic development. Chapter
381 allows counties to provide loans and
grants in exchange for business location and
commercial activity.
Texas Tax Code Chapters 311 and 312
allow cities, counties and special districtsl1-u
0 0to offer businesses a complete or partial
abatement on property taxes associated
with improvements to property for up
to 10 years, in exchange for specific
improvements or repairs to the property.
Tax Code Chapter 313 allows public school
districts to offer businesses a 10-year
limitation on property value for a portion of
the property tax in exchange for investment
and the creation of jobs meeting certain
requirements.
With voter approval, Texas cities can levy
special local sales taxes, called the Type A
and Type B sales taxes, to fund economic
development programs. Cities must form
economic development corporations to
administer this funding.
Type A revenue is generally used to promote
manufacturing and industrial development,
and may be used to fund land, buildings,
equipment and infrastructure for approved
projects. Type B revenue may be used for
all projects funded by Type A as well as
other purposes, such as "quality of life"
improvements that make areas more
attractive to business, including sports
and athletic facilities, tourism and
entertainment facilities, convention facilities
and public parks.I
54,FISCAL NOTES, NOVEMBER 2016 7
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Texas. Comptroller's Office. Fiscal Notes: November 2016, periodical, November 2016; Austin, Texas. (https://texashistory.unt.edu/ark:/67531/metapth1577968/m1/7/: accessed July 18, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.