Texas: A Great State to Grow A Business!
Texas combines its wide horizons and accommodating climates, its diverse population and healthy markets and stubborn pursuit to create an excellent environment for business.
Texas Enterprise Fund
The 78th Texas Legislature established the Texas Enterprise Fund (TEF) to provide financial resources to help strengthen the state’s economy. TEF awards “deal closing” grants to companies considering a new project in which a single Texas site is competing with another viable out-of-state site. The fund is a performance-based grant that serves as a financial incentive for companies whose projects would contribute significant capital investment and new employment opportunities to the state’s economy. Projects that are considered for TEF must demonstrate a project’s worthiness, maximize the benefits to the state and realize a significant rate of return of the public dollars being used for economic development in Texas. The program eligibility requirements include: a single Texas site being considered that is competing with another viable out-of-state site; significant levels of capital investment; a projected job creation that exceeds 75 full-time jobs (urban areas) or 25 full-time jobs (rural areas); average wages that meet or exceed the average county wage for the site under consideration; local financial support; and company’s financial strength and business history. The Governor, Lieutenant Governor and the Speaker of the House of Representatives must unanimously agree to support the use of TEF for each specific project. Eligible companies must submit a complete application to be considered for a TEF grant. Award amounts typically range between $1,000 and $10,000 per qualified job. Award amounts are based on capital investment, net new qualified jobs associated with the application, the average wage of those jobs and the time frame required for job ramp up. Please note that contract workers will not be considered. https://gov.texas.gov/business/page/texas-enterprise-fund
Texas Enterprise Zone Program
Under the statewide cap of 105 projects per biennium, a community with less than 250,000 in population, may have up to six enterprise projects. The City of Hitchcock may have up to six enterprise projects. Upon a community designating a business as an enterprise project, and upon that project’s designation being approved by the state, the business would be eligible for the following incentives: State Sales and Use Tax Refunds: An enterprise project is eligible for a refund for all state sales and use taxes paid and used at the qualified business site. The total amount of any refund will continue to be predicated on investment amount and number of jobs created/retained. The refund for each designation can be an amount ranging from a minimum of $2,500 per job to a maximum of $7,500 per job as follows: Half Enterprise Project: If project investment amount if greater than $40,000 and equal to $5 million or more, then refund amount is $2,500 per job up to a maximum of 250 jobs created/retained. Maximum refund available is $625,000; Enterprise Project: If project investment amount is equal to or greater than $5 million or more, then refund amount is $2,500 per job up to a maximum of 500 jobs created/retained; Double Jumbo Enterprise Project: If project investment amount is equal to or greater than $150 million and less than $250 million, then refund amount is $5,000 per job up to a maximum of 500 jobs created; Triple Jumbo Enterprise Project: If project investment amount is equal to or greater than $250 million, then refund amount is $7,500 per job up to a minimum of 500 jobs created. Maximum refund available is $3.75 million. Receipts for purchases of building materials and machinery and equipment and payroll information are required to be retained as part of the audit process. (Note: All contracts should separate the costs for building materials and/or equipment from the costs of labor and services in order to be eligible.) The refund for sales and use tax must be for all eligible items for use at the qualified business site. https://gov.texas.gov/business/page/texas-enterprise-zone-program.
Texas Jobs, Energy, Technology & Innovation (JETI) Act
The Texas Jobs, Energy, Technology & Innovation Act (JETI) is a new competitive economic incentive program to attract large-scale economic development projects, bringing new capital investment and creating new, high-paying jobs in Texas communities. The program is applicable to manufacturing facilities, dispatchable electric generation facilities, natural resource development facilities, research, development or manufacturing facilities for high-tech infrastructure equipment or technology, and the construction or expansion of critical infrastructure. Renewable energy projects or energy storage facilities are prohibited from receiving the incentive. Qualified projects can apply to the Texas Comptroller of Public Accounts, and with Governor and school district approval, may enter into an agreement to abate 50% of school district property taxes for a specified 10-year period. Applicants are eligible for an additional 25% abatement if locating in an opportunity zone. The program provides robust reporting and transparency requirements and includes a legislative oversight committee that must report to the legislature on what types of eligible projects should be added or removed from the program. https://gov.texas.gov/business/page/texas-jobs-energy-technology-and-innovation-jeti
Texas Semiconductor Innovation Fund
The Texas Semiconductor Innovation Fund (TSIF) is a new incentive program to encourage the continued leadership of Texas in semiconductor research, design and manufacturing. The TSIF was established in June 2023 when Governor Abbott signed into law the Texas CHIPS Act (House Bill 5174) which established the TSIF as well as the Texas Semiconductor Innovation Consortium (TSIC). The Texas legislature appropriated $698.3 million to the TSIF. The TSIF will provide grants to state entities and institutions of higher education for semiconductor manufacturing and design projects; and award grants to business entities with an established presence within the state of Texas to encourage economic development related to semiconductor manufacturing and design. More information: https://gov.texas.gov/business/page/tsif.
Texas Manufacturing Sales and Use Tax Exemption
Leased or purchased machinery, equipment, replacement parts, and accessories that are used or consumed in the manufacturing, processing, fabricating, or repairing of tangible personal property for ultimate sale, are exempt from state and local sales and use tax. Texas businesses are exempt from paying state sales and use tax on labor for constructing new facilities. Texas businesses are exempt from paying state sales and use tax on the purchase of machinery exclusively used in processing, packing, or marketing agricultural products by the original producer at a location operated by the original producer.
Research & Development Tax Credit
In 2013, the 83rd Texas Legislature enacted House Bill 800, creating a Research & Development tax credit effective January 1, 2014. This allowed companies a choice between a franchise tax credit and a sales tax exemption for mate-rials, software and equipment used for R&D purposes. Tax Code Chapter 171, subchapter M effectively establishes the qualifications, definitions and eligibility criteria for the credit. More information: https://comptroller.texas.gov/taxes/qualified-research/
Sales Tax Exemption or Franchise Tax Credit for Qualified Research
In 2014, a Texas law went into effect to encourage economic development in Texas related to research and development. A person engaged in qualified research can claim either: 1) a sales and use tax exemption on the purchase, lease, rental, storage or use of depreciable tangible personal property directly used in qualified research, or; 2) a franchise tax credit based on qualified research expenses. A person cannot claim both the sales tax exemption and the franchise tax credit for the same period. The election to claim the sales tax exemption or take the franchise tax credit is not permanent and can be changed. More information click here.
Texas Semiconductor Innovation Fund
The Texas Semiconductor Innovation Fund (TSIF) is a new incentive program to encourage the continued leadership of Texas in semiconductor research, design and manufacturing. The TSIF was established in June 2023 when Governor Abbott signed into law the Texas CHIPS Act (House Bill 5174) which established the TSIF as well as the Texas Semiconductor Innovation Consortium (TSIC). The Texas legislature appropriated $698.3 million to the TSIF. The TSIF will provide grants to state entities and institutions of higher education for semiconductor manufacturing and design projects; and award grants to business entities with an established presence within the state of Texas to encourage economic development related to semiconductor manufacturing and design. More information click here.
Pollution Control Property Tax Abatements
A Texas constitutional amendment providing an exemption from property taxation for pollution control was approved in 1993. The intent was to ensure that compliance with environmental mandates, through capital investments, did not result in an increase in a facility’s property taxes. A facility must first receive a determination from the Texas Commission on Environment Quality (TCEQ) that property is for pollution control purposes. That positive use determination is then provided to the local appraisal district, which must accept the TCEQ’s decision and grant the property an exemption from property taxes. To be eligible for a positive use determination, the property must have been purchased, acquired, constructed, installed, replaced, or reconstructed after January 1, 1994, to meet or exceed federal, state, or local environmental laws, rules, or regulations. For more information, contact David Greer with the Texas Commission on Environmental Quality at (512) 239 -5344.
Economic Development and Diversification In-State Tuition
This incentive may be offered to qualified businesses that are in the decision-making process to relocate or expand their operations into Texas. The incentive is targeted to assist high impact projects that are linked to the strategic economic clusters identified in the state. The incentive allows employees and family members of the qualified businesses to pay in-state tuition fees if the individual files with a Texas institution of higher education. Without this incentive designation, a student must reside in Texas for a 12-month period to be entitled to pay the tuition fees of a Texas resident. Visit for more information
Texas Skills Development Fund
This is an innovative program created to assist Texas public community and technical colleges finance customized job training for their local businesses. The Fund was established by the Legislature in 1995 and is administered by the Texas Workforce Commission. Grants are provided to help companies and labor unions form partnerships with local community colleges and technical schools to provide custom job training. Average training costs is $2,000 per trainee; however, the benefit may vary depending on the proposal. More information click here.
Texas Skills for Small Business Grant
This program supports businesses with fewer than 100 employees. The program focuses on training new and incumbent workers. Up to $2 million is available for supporting our state's small employers. With over 433,000 small businesses in Texas, small employers are a key part of the business community. Small businesses can apply to Texas Workforce Commission (TWC) for training provided by a local community college. TWC will process the application and work with colleges to fund the courses. The business is then able to select the courses to customize training to their needs. Program Details: This program emphasizes new and incumbent employees for small businesses. The program funds $2,000 per new employee and $1,000 per incumbent employee. Funding for training is for full-time employees. All training must be provided by a public community or technical college. Employers must pay the prevailing wage in their local labor markets. Common training courses include: Customer Services, Quickbooks, CPR, Sales/Marketing. Managers and business owners may be eligible to participate, dependent on job duties. More information click here.
Texas Self-Sufficiency Fund
The Self-Sufficiency Fund is a job-training program that is specifically designed for individuals that receive Temporary Assistance for Needy Families (TANF). The program links the business community with local educational institutions and is administered by the Texas Workforce Commission. The goal of the fund is to assist TANF recipients become independent of government financial assistance. The fund makes grants available to eligible public colleges or to eligible private, nonprofit organizations to provide customized job training and training support services for specific employers. A joint application from the employer and the eligible public college and/or eligible private, nonprofit organization is required to be submitted to the Local Workforce Development Board for review and comment prior to approval. More information: contact the Texas Workforce Commission at (512) 463-1986 or click here.
Texas Product Development and Small Business Incubator Fund
This program collectively PDSBI, is a revolving loan program financed through original bond issuances. The primary objective of the program is to aid in the development, production and commercialization of new or improved products and to foster and stimulate small business in the state. The fund provides asset-based lending with flexible loan terms, competitive Loan-to-Value (LTV) and interest rates. Loan proceeds can be used for a broad range of capital and operating expenditures. Your company can secure loans with property, plant and equipment which can be amortized over the life of the asset. Communities or individual investors can assist as Guarantors. To be eligible, applicants must have at least 3 years of operating history and have unencumbered assets available for collateral. Preference for funding is given to the state’s defend industry clusters including, but not limited to: nano-technology, biotechnology, biomedicine, renewable energy, agriculture and aerospace. Texas is interested in creating and retaining high-quality jobs.
Texas Small Business Credit Initiative (TSBCI)
The objective of the Texas Small Business Credit Initiative (TSBCI) is to support state programs that provide resources to assist small business growth and create new jobs through increased access to small business funding. In addition, the program will assist small businesses that are traditionally marginalized and those that have been impacted by the COVID-19 pandemic. Socially and Economically Disadvantaged Individuals (SEDI), Very Small Businesses (VSB) or other business owners should contact their preferred lender to encourage their participation in TSBCI programs as a financial institution. Texas will administer two programs under TSBCI: A Capital Access Program (CAP) and a Loan Guarantee Program (LGP), which are open to eligible new and existing Texas businesses with 499 or fewer employees. For the CAP program, loan amounts range from $5,000 to $5 million. For the LGP program, loan amounts range from $5,000 to $20 million. The State of Texas is focused on staying apprised of the latest program information released by the U.S. Department of the Treasury. More information click here.
Franchise Tax Exemption & Deduction for Business Relocation
Effective Jan 1, 2014, House Bill 500 provides authorization for a company to deduct moving expenses from their apportioned margin while calculating their franchise liability. Companies must relocate their principal place of business from outside the state into Texas to obtain the deduction. A taxable entity may deduct relocation costs incurred in relocating the taxable entity’s main office or other principal place of business to this state from another state if the business meets the criteria in Texas Tax Code Section 171.109(b). The taxable entity must take the deduction on the entity’s first annual report described by Rule 3.584(c) (2). The deduction may not reduce apportioned margin below zero, and no carryover of unused deduction is allowed. The bill also makes permanent an exemption for businesses that gross less than $1 million in revenue while providing a $1 million deduction for businesses once they pass the gross receipts revenue threshold. The bill also amends the margin calculation accordingly for equity. More information click here.
Media Production Development Zone Act
The Media Production Development Zone Act (MPDZ), established by the 81st Texas Legislature in 2009 and administered by the Texas Film Commission, is designed to encourage the further development of permanent moving image production sites to help strengthen Texas’ economy. MPDZ allows for a sales and use tax exemption for the construction, maintenance, expansion, improvement, or renovation of a media production facility at a qualified media production location over a two-year period. Media production facilities include but are not limited to animation/CGI studios, postproduction facilities, sound stages, video game development studios and production office space.
Medical or Biomedical Property Tax Exemption
Effective January 1, 2024, the 88th Legislature established a property tax exemption for medical or biomedical property. A company is entitled to an exemption from taxation of medical or biomedical property that is located in a medical or biomedical manufacturing facility that the company owns or leases. Qualified medical or biomedical property is tangible personal property that is: a) stored, used or consumed in the manufacturing or processing of medical or biomedical products by a medical or biomedical manufacturer; b) or intended for use in the diagnosis, cure, mitigation, treatment or prevention of a condition or disease or in medical or biomedical research, including the invention, development and dissemination of materials, tools, technologies, processes and similar means for translating and applying medical and scientific research for practical applications to advance public health. A qualified medical or biomedical manufacturing facility is a facility at which a company conducts manufacturing or processing of medical or biomedical products for the purpose of development and commercialization of products to advance public health. More information: Texas Tax Code, Section 11.36.
Wind and Solar Energy Tax Exemptions and Deductions
Tax Code Section 171.056 extends a franchise tax exemption to manufacturers, sellers, or installers of solar energy devices. The state also permits a corporate deduction from the state’s franchise tax for renewable energy sources. Business owners may deduct the cost of the system from the company’s taxable capital or deduct 10% from the company’s income. Wind energy qualifies under the term “solar energy” for the exemption and deduction under Sections 171.056 and 171.107.
Renewable Energy Property Tax Exemption
Texas property tax code permits a 100% exemption on the appraised value of solar, wind or biomass energy devices installed or constructed for the production and use of energy on-site. See Texas property tax Form 50-123, “Exemption Application for Solar or Wind-Powered Energy Devices” to claim this exemption.
Texas Loan STAR (Saving Taxes and Resources) Revolving Loan Program
This program provides low-interest loans to assist Texas public institutions by financing their energy-related, cost-reduction retrofit projects. Loan recipients may be cities, counties, independent school districts, state agencies, public institutions of higher education and tax-supported public hospital districts. More information: click here.
Research & Development Tax Credit
In 2013, the 83rd Texas Legislature enacted House Bill 800, creating a Research & Development tax credit effective January 1, 2014. This allowed companies a choice between a franchise tax credit and a sales tax exemption for mate-rials, software and equipment used for R&D purposes. Tax Code Chapter 171, subchapter M effectively establishes the qualifications, definitions and eligibility criteria for the credit. More information click here.
Sales Tax Exemption for Media Productions & Facilities
Under Texas law, a producer or production company may claim a sales or use tax exemption on items or services necessary to and used or consumed directly during the production of a project intended for commercial distribution such as a feature film, commercial, television project or recording of live performances. Sales and use tax exemptions are not eligible for productions not sold to the public, such as wedding videos and videos shown on social media or video games. More information click here.
Cancer Prevention & Research General Obligation Bonds
On November 6, 2007, Texas voters approved Proposition 15 - HJR 90, the constitutional amendment which allows the State of Texas to establish the Cancer Prevention and Research Institute of Texas (the Institute) and allows the Institute to issue $3 billion in general obligation bonds over ten years to fund grants for cancer research and prevention. The Institute may invest the grants strategically in cancer research, clinical trials, and laboratory facility construction in Texas. The Institute will continue to implement the Texas Cancer Plan. For more information click here.
Defense Economic Adjustment Assistance Grant
The Defense Economic Adjustment Assistance Grant Program (DEAAG), created in 1997, is a job creation grant program designed to assist adversely impacted defense communities that are responding to or recovering from a U.S. Department of Defense Base Realignment and Closure (BRAC) action, or reductions or termination of defense contracts. The program was later expanded to assist defense communities that have been positively affected by BRAC with new or expanded military missions, as well as qualified job retention. DEAAG funding is available to local municipalities, counties, defense base development authorities, junior college districts, Texas State Technical College campuses and regional planning commissions representing these communities. Funding is available to meet matching requirements for federal funding or for the purchase of Department of Defense property, new construction, rehabilitation of facilities or infrastructure, or the purchase of capital equipment or insurance. Grants awarded may range from $50,000 to $5 million per project. For more information click here.
Governor’s University Research Initiative
The Governor’s University Research Initiative grant program (GURI) was enacted in 2015 by the 84th Legislature with a goal to bring the best and brightest researchers in the world to Texas colleges and universities. Through the GURI program, Texas welcomes transformative researchers who will in turn serve as economic catalysts to the Texas economy for years to come. GURI is a matching grant program to assist eligible Texas institutions of higher education in recruiting distinguished re- searchers, such as Nobel Laureates and members of national honorific societies, from around the world. The program is codified in Chapter 62 of the Texas Education Code, Subchapter H and the program’s administrative rules may be found in Title 10, Part 5, Chapter 190 of the Texas Administrative Code. For more information click here.
Texas combines its wide horizons and accommodating climates, its diverse population and healthy markets and stubborn pursuit to create an excellent environment for business.
Texas Enterprise Fund
The 78th Texas Legislature established the Texas Enterprise Fund (TEF) to provide financial resources to help strengthen the state’s economy. TEF awards “deal closing” grants to companies considering a new project in which a single Texas site is competing with another viable out-of-state site. The fund is a performance-based grant that serves as a financial incentive for companies whose projects would contribute significant capital investment and new employment opportunities to the state’s economy. Projects that are considered for TEF must demonstrate a project’s worthiness, maximize the benefits to the state and realize a significant rate of return of the public dollars being used for economic development in Texas. The program eligibility requirements include: a single Texas site being considered that is competing with another viable out-of-state site; significant levels of capital investment; a projected job creation that exceeds 75 full-time jobs (urban areas) or 25 full-time jobs (rural areas); average wages that meet or exceed the average county wage for the site under consideration; local financial support; and company’s financial strength and business history. The Governor, Lieutenant Governor and the Speaker of the House of Representatives must unanimously agree to support the use of TEF for each specific project. Eligible companies must submit a complete application to be considered for a TEF grant. Award amounts typically range between $1,000 and $10,000 per qualified job. Award amounts are based on capital investment, net new qualified jobs associated with the application, the average wage of those jobs and the time frame required for job ramp up. Please note that contract workers will not be considered. https://gov.texas.gov/business/page/texas-enterprise-fund
Texas Enterprise Zone Program
Under the statewide cap of 105 projects per biennium, a community with less than 250,000 in population, may have up to six enterprise projects. The City of Hitchcock may have up to six enterprise projects. Upon a community designating a business as an enterprise project, and upon that project’s designation being approved by the state, the business would be eligible for the following incentives: State Sales and Use Tax Refunds: An enterprise project is eligible for a refund for all state sales and use taxes paid and used at the qualified business site. The total amount of any refund will continue to be predicated on investment amount and number of jobs created/retained. The refund for each designation can be an amount ranging from a minimum of $2,500 per job to a maximum of $7,500 per job as follows: Half Enterprise Project: If project investment amount if greater than $40,000 and equal to $5 million or more, then refund amount is $2,500 per job up to a maximum of 250 jobs created/retained. Maximum refund available is $625,000; Enterprise Project: If project investment amount is equal to or greater than $5 million or more, then refund amount is $2,500 per job up to a maximum of 500 jobs created/retained; Double Jumbo Enterprise Project: If project investment amount is equal to or greater than $150 million and less than $250 million, then refund amount is $5,000 per job up to a maximum of 500 jobs created; Triple Jumbo Enterprise Project: If project investment amount is equal to or greater than $250 million, then refund amount is $7,500 per job up to a minimum of 500 jobs created. Maximum refund available is $3.75 million. Receipts for purchases of building materials and machinery and equipment and payroll information are required to be retained as part of the audit process. (Note: All contracts should separate the costs for building materials and/or equipment from the costs of labor and services in order to be eligible.) The refund for sales and use tax must be for all eligible items for use at the qualified business site. https://gov.texas.gov/business/page/texas-enterprise-zone-program.
Texas Jobs, Energy, Technology & Innovation (JETI) Act
The Texas Jobs, Energy, Technology & Innovation Act (JETI) is a new competitive economic incentive program to attract large-scale economic development projects, bringing new capital investment and creating new, high-paying jobs in Texas communities. The program is applicable to manufacturing facilities, dispatchable electric generation facilities, natural resource development facilities, research, development or manufacturing facilities for high-tech infrastructure equipment or technology, and the construction or expansion of critical infrastructure. Renewable energy projects or energy storage facilities are prohibited from receiving the incentive. Qualified projects can apply to the Texas Comptroller of Public Accounts, and with Governor and school district approval, may enter into an agreement to abate 50% of school district property taxes for a specified 10-year period. Applicants are eligible for an additional 25% abatement if locating in an opportunity zone. The program provides robust reporting and transparency requirements and includes a legislative oversight committee that must report to the legislature on what types of eligible projects should be added or removed from the program. https://gov.texas.gov/business/page/texas-jobs-energy-technology-and-innovation-jeti
Texas Semiconductor Innovation Fund
The Texas Semiconductor Innovation Fund (TSIF) is a new incentive program to encourage the continued leadership of Texas in semiconductor research, design and manufacturing. The TSIF was established in June 2023 when Governor Abbott signed into law the Texas CHIPS Act (House Bill 5174) which established the TSIF as well as the Texas Semiconductor Innovation Consortium (TSIC). The Texas legislature appropriated $698.3 million to the TSIF. The TSIF will provide grants to state entities and institutions of higher education for semiconductor manufacturing and design projects; and award grants to business entities with an established presence within the state of Texas to encourage economic development related to semiconductor manufacturing and design. More information: https://gov.texas.gov/business/page/tsif.
Texas Manufacturing Sales and Use Tax Exemption
Leased or purchased machinery, equipment, replacement parts, and accessories that are used or consumed in the manufacturing, processing, fabricating, or repairing of tangible personal property for ultimate sale, are exempt from state and local sales and use tax. Texas businesses are exempt from paying state sales and use tax on labor for constructing new facilities. Texas businesses are exempt from paying state sales and use tax on the purchase of machinery exclusively used in processing, packing, or marketing agricultural products by the original producer at a location operated by the original producer.
Research & Development Tax Credit
In 2013, the 83rd Texas Legislature enacted House Bill 800, creating a Research & Development tax credit effective January 1, 2014. This allowed companies a choice between a franchise tax credit and a sales tax exemption for mate-rials, software and equipment used for R&D purposes. Tax Code Chapter 171, subchapter M effectively establishes the qualifications, definitions and eligibility criteria for the credit. More information: https://comptroller.texas.gov/taxes/qualified-research/
Sales Tax Exemption or Franchise Tax Credit for Qualified Research
In 2014, a Texas law went into effect to encourage economic development in Texas related to research and development. A person engaged in qualified research can claim either: 1) a sales and use tax exemption on the purchase, lease, rental, storage or use of depreciable tangible personal property directly used in qualified research, or; 2) a franchise tax credit based on qualified research expenses. A person cannot claim both the sales tax exemption and the franchise tax credit for the same period. The election to claim the sales tax exemption or take the franchise tax credit is not permanent and can be changed. More information click here.
Texas Semiconductor Innovation Fund
The Texas Semiconductor Innovation Fund (TSIF) is a new incentive program to encourage the continued leadership of Texas in semiconductor research, design and manufacturing. The TSIF was established in June 2023 when Governor Abbott signed into law the Texas CHIPS Act (House Bill 5174) which established the TSIF as well as the Texas Semiconductor Innovation Consortium (TSIC). The Texas legislature appropriated $698.3 million to the TSIF. The TSIF will provide grants to state entities and institutions of higher education for semiconductor manufacturing and design projects; and award grants to business entities with an established presence within the state of Texas to encourage economic development related to semiconductor manufacturing and design. More information click here.
Pollution Control Property Tax Abatements
A Texas constitutional amendment providing an exemption from property taxation for pollution control was approved in 1993. The intent was to ensure that compliance with environmental mandates, through capital investments, did not result in an increase in a facility’s property taxes. A facility must first receive a determination from the Texas Commission on Environment Quality (TCEQ) that property is for pollution control purposes. That positive use determination is then provided to the local appraisal district, which must accept the TCEQ’s decision and grant the property an exemption from property taxes. To be eligible for a positive use determination, the property must have been purchased, acquired, constructed, installed, replaced, or reconstructed after January 1, 1994, to meet or exceed federal, state, or local environmental laws, rules, or regulations. For more information, contact David Greer with the Texas Commission on Environmental Quality at (512) 239 -5344.
Economic Development and Diversification In-State Tuition
This incentive may be offered to qualified businesses that are in the decision-making process to relocate or expand their operations into Texas. The incentive is targeted to assist high impact projects that are linked to the strategic economic clusters identified in the state. The incentive allows employees and family members of the qualified businesses to pay in-state tuition fees if the individual files with a Texas institution of higher education. Without this incentive designation, a student must reside in Texas for a 12-month period to be entitled to pay the tuition fees of a Texas resident. Visit for more information
Texas Skills Development Fund
This is an innovative program created to assist Texas public community and technical colleges finance customized job training for their local businesses. The Fund was established by the Legislature in 1995 and is administered by the Texas Workforce Commission. Grants are provided to help companies and labor unions form partnerships with local community colleges and technical schools to provide custom job training. Average training costs is $2,000 per trainee; however, the benefit may vary depending on the proposal. More information click here.
Texas Skills for Small Business Grant
This program supports businesses with fewer than 100 employees. The program focuses on training new and incumbent workers. Up to $2 million is available for supporting our state's small employers. With over 433,000 small businesses in Texas, small employers are a key part of the business community. Small businesses can apply to Texas Workforce Commission (TWC) for training provided by a local community college. TWC will process the application and work with colleges to fund the courses. The business is then able to select the courses to customize training to their needs. Program Details: This program emphasizes new and incumbent employees for small businesses. The program funds $2,000 per new employee and $1,000 per incumbent employee. Funding for training is for full-time employees. All training must be provided by a public community or technical college. Employers must pay the prevailing wage in their local labor markets. Common training courses include: Customer Services, Quickbooks, CPR, Sales/Marketing. Managers and business owners may be eligible to participate, dependent on job duties. More information click here.
Texas Self-Sufficiency Fund
The Self-Sufficiency Fund is a job-training program that is specifically designed for individuals that receive Temporary Assistance for Needy Families (TANF). The program links the business community with local educational institutions and is administered by the Texas Workforce Commission. The goal of the fund is to assist TANF recipients become independent of government financial assistance. The fund makes grants available to eligible public colleges or to eligible private, nonprofit organizations to provide customized job training and training support services for specific employers. A joint application from the employer and the eligible public college and/or eligible private, nonprofit organization is required to be submitted to the Local Workforce Development Board for review and comment prior to approval. More information: contact the Texas Workforce Commission at (512) 463-1986 or click here.
Texas Product Development and Small Business Incubator Fund
This program collectively PDSBI, is a revolving loan program financed through original bond issuances. The primary objective of the program is to aid in the development, production and commercialization of new or improved products and to foster and stimulate small business in the state. The fund provides asset-based lending with flexible loan terms, competitive Loan-to-Value (LTV) and interest rates. Loan proceeds can be used for a broad range of capital and operating expenditures. Your company can secure loans with property, plant and equipment which can be amortized over the life of the asset. Communities or individual investors can assist as Guarantors. To be eligible, applicants must have at least 3 years of operating history and have unencumbered assets available for collateral. Preference for funding is given to the state’s defend industry clusters including, but not limited to: nano-technology, biotechnology, biomedicine, renewable energy, agriculture and aerospace. Texas is interested in creating and retaining high-quality jobs.
Texas Small Business Credit Initiative (TSBCI)
The objective of the Texas Small Business Credit Initiative (TSBCI) is to support state programs that provide resources to assist small business growth and create new jobs through increased access to small business funding. In addition, the program will assist small businesses that are traditionally marginalized and those that have been impacted by the COVID-19 pandemic. Socially and Economically Disadvantaged Individuals (SEDI), Very Small Businesses (VSB) or other business owners should contact their preferred lender to encourage their participation in TSBCI programs as a financial institution. Texas will administer two programs under TSBCI: A Capital Access Program (CAP) and a Loan Guarantee Program (LGP), which are open to eligible new and existing Texas businesses with 499 or fewer employees. For the CAP program, loan amounts range from $5,000 to $5 million. For the LGP program, loan amounts range from $5,000 to $20 million. The State of Texas is focused on staying apprised of the latest program information released by the U.S. Department of the Treasury. More information click here.
Franchise Tax Exemption & Deduction for Business Relocation
Effective Jan 1, 2014, House Bill 500 provides authorization for a company to deduct moving expenses from their apportioned margin while calculating their franchise liability. Companies must relocate their principal place of business from outside the state into Texas to obtain the deduction. A taxable entity may deduct relocation costs incurred in relocating the taxable entity’s main office or other principal place of business to this state from another state if the business meets the criteria in Texas Tax Code Section 171.109(b). The taxable entity must take the deduction on the entity’s first annual report described by Rule 3.584(c) (2). The deduction may not reduce apportioned margin below zero, and no carryover of unused deduction is allowed. The bill also makes permanent an exemption for businesses that gross less than $1 million in revenue while providing a $1 million deduction for businesses once they pass the gross receipts revenue threshold. The bill also amends the margin calculation accordingly for equity. More information click here.
Media Production Development Zone Act
The Media Production Development Zone Act (MPDZ), established by the 81st Texas Legislature in 2009 and administered by the Texas Film Commission, is designed to encourage the further development of permanent moving image production sites to help strengthen Texas’ economy. MPDZ allows for a sales and use tax exemption for the construction, maintenance, expansion, improvement, or renovation of a media production facility at a qualified media production location over a two-year period. Media production facilities include but are not limited to animation/CGI studios, postproduction facilities, sound stages, video game development studios and production office space.
Medical or Biomedical Property Tax Exemption
Effective January 1, 2024, the 88th Legislature established a property tax exemption for medical or biomedical property. A company is entitled to an exemption from taxation of medical or biomedical property that is located in a medical or biomedical manufacturing facility that the company owns or leases. Qualified medical or biomedical property is tangible personal property that is: a) stored, used or consumed in the manufacturing or processing of medical or biomedical products by a medical or biomedical manufacturer; b) or intended for use in the diagnosis, cure, mitigation, treatment or prevention of a condition or disease or in medical or biomedical research, including the invention, development and dissemination of materials, tools, technologies, processes and similar means for translating and applying medical and scientific research for practical applications to advance public health. A qualified medical or biomedical manufacturing facility is a facility at which a company conducts manufacturing or processing of medical or biomedical products for the purpose of development and commercialization of products to advance public health. More information: Texas Tax Code, Section 11.36.
Wind and Solar Energy Tax Exemptions and Deductions
Tax Code Section 171.056 extends a franchise tax exemption to manufacturers, sellers, or installers of solar energy devices. The state also permits a corporate deduction from the state’s franchise tax for renewable energy sources. Business owners may deduct the cost of the system from the company’s taxable capital or deduct 10% from the company’s income. Wind energy qualifies under the term “solar energy” for the exemption and deduction under Sections 171.056 and 171.107.
Renewable Energy Property Tax Exemption
Texas property tax code permits a 100% exemption on the appraised value of solar, wind or biomass energy devices installed or constructed for the production and use of energy on-site. See Texas property tax Form 50-123, “Exemption Application for Solar or Wind-Powered Energy Devices” to claim this exemption.
Texas Loan STAR (Saving Taxes and Resources) Revolving Loan Program
This program provides low-interest loans to assist Texas public institutions by financing their energy-related, cost-reduction retrofit projects. Loan recipients may be cities, counties, independent school districts, state agencies, public institutions of higher education and tax-supported public hospital districts. More information: click here.
Research & Development Tax Credit
In 2013, the 83rd Texas Legislature enacted House Bill 800, creating a Research & Development tax credit effective January 1, 2014. This allowed companies a choice between a franchise tax credit and a sales tax exemption for mate-rials, software and equipment used for R&D purposes. Tax Code Chapter 171, subchapter M effectively establishes the qualifications, definitions and eligibility criteria for the credit. More information click here.
Sales Tax Exemption for Media Productions & Facilities
Under Texas law, a producer or production company may claim a sales or use tax exemption on items or services necessary to and used or consumed directly during the production of a project intended for commercial distribution such as a feature film, commercial, television project or recording of live performances. Sales and use tax exemptions are not eligible for productions not sold to the public, such as wedding videos and videos shown on social media or video games. More information click here.
Cancer Prevention & Research General Obligation Bonds
On November 6, 2007, Texas voters approved Proposition 15 - HJR 90, the constitutional amendment which allows the State of Texas to establish the Cancer Prevention and Research Institute of Texas (the Institute) and allows the Institute to issue $3 billion in general obligation bonds over ten years to fund grants for cancer research and prevention. The Institute may invest the grants strategically in cancer research, clinical trials, and laboratory facility construction in Texas. The Institute will continue to implement the Texas Cancer Plan. For more information click here.
Defense Economic Adjustment Assistance Grant
The Defense Economic Adjustment Assistance Grant Program (DEAAG), created in 1997, is a job creation grant program designed to assist adversely impacted defense communities that are responding to or recovering from a U.S. Department of Defense Base Realignment and Closure (BRAC) action, or reductions or termination of defense contracts. The program was later expanded to assist defense communities that have been positively affected by BRAC with new or expanded military missions, as well as qualified job retention. DEAAG funding is available to local municipalities, counties, defense base development authorities, junior college districts, Texas State Technical College campuses and regional planning commissions representing these communities. Funding is available to meet matching requirements for federal funding or for the purchase of Department of Defense property, new construction, rehabilitation of facilities or infrastructure, or the purchase of capital equipment or insurance. Grants awarded may range from $50,000 to $5 million per project. For more information click here.
Governor’s University Research Initiative
The Governor’s University Research Initiative grant program (GURI) was enacted in 2015 by the 84th Legislature with a goal to bring the best and brightest researchers in the world to Texas colleges and universities. Through the GURI program, Texas welcomes transformative researchers who will in turn serve as economic catalysts to the Texas economy for years to come. GURI is a matching grant program to assist eligible Texas institutions of higher education in recruiting distinguished re- searchers, such as Nobel Laureates and members of national honorific societies, from around the world. The program is codified in Chapter 62 of the Texas Education Code, Subchapter H and the program’s administrative rules may be found in Title 10, Part 5, Chapter 190 of the Texas Administrative Code. For more information click here.