Incentives

Projects may be eligible for Federal, State, and/or local incentives. Incentive packages are determined by type of business, quality of jobs created or retained, wages paid, capital investment and overall community impact. The communities of Grand Central Texas Economic Development Partnership are ready to work with you to identify the incentives available for your potential Central Texas location.

To see local incentives offered by each Grand Central Texas Community please view the links at the bottom of this page.

State Incentives

The information listed below is a summary of Incentives offered by the State of Texas and is provided for informational purposes only and does not constitute a commitment. Applicants must meet the requirements set forth by the state for each incentive to qualify.

The Texas Enterprise Fund

The Texas Enterprise Fund attracts new businesses and assists growing existing business in the state. The fund is the largest “deal closing” fund of its kind in the nation. Projects that are considered for Enterprise Fund support must maximize the benefit to the State of Texas and realize a significant rate of return of the public dollars being used for economic development in Texas.

Capital investment, job creation, wages generated, financial strength of the applicant, applicant’s business history, analysis of the relevant business sector, and federal and local government and private sector financial support of a project are all significant factors in approving the use of the Enterprise Fund.

The award amounts have generally been in the range of $1,000 up to $10,000 per job created.

Texas Enterprise Zone Program

Cities have the ability to nominate projects for the Texas Enterprise Zone Program. The city may nominate up to six projects per legislative biennium, with a statewide cap of 105 projects per biennium.

Upon the city designating a business as an Enterprise Zone project, and upon that project’s designation being approved by the state, the business is eligible for a refund of state sales and use taxes paid and used at the qualified business site. The total amount of any refund is predicated on the total investment and number of jobs created or retained by the project. The refund is allocated on a per job basis, not to exceed 500 total jobs, that ranges from a minimum of $2,500 per job to a maximum of $7,500 per job.

Manufacturing Machinery & Equipment

Leased or purchased machinery, equipment, replacement parts and accessories that have a useful life of more than six months and 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.

Skills Development Fund

The Skills Development Fund is an innovative program created to assist Texas public community and technical colleges in financing customized job training for their local businesses.

The fund 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 benefits are $1,000 per trainee. However, the benefit may vary depending on the proposal.

Natural Gas & Electricity

Texas companies are exempt from paying state sales and use tax on electricity and natural gas used in manufacturing, processing or fabricating tangible personal property. The company must complete a predominant use study that shows that at least 50% of the electricity or natural gas consumed by the business directly causes a physical change to a product.

Economic Development Refund

The Texas Comptroller of Public Accounts offers a refund of state franchise and sales/use taxes paid by companies that own certain abated property. A company who meets the following three conditions may apply for a refund:

Paid property taxes to a school district on property that is located in a reinvestment zone established under Chapter 312
Is exempt in whole or in part from property taxes imposed by a city or a county under a tax abatement agreement established under Chapter 312
Is not in a tax abatement agreement with a school district

The refund is equal to the amount of property taxes that would have been paid had the company entered into a school district abatement agreement with terms identical to the city or county abatement agreement, not to exceed the net state sales and use taxes and state franchise taxes paid or collected and remitted during that calendar year. The refund amount may also be limited by a statewide appropriation per year for this refund program.

State Sales & Use Tax Exemptions

Texas businesses are exempt from paying state sales and use tax on labor for constructing new facilities or 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.

Governor’s University Research Initiative

The Governor’s University Research Initiative grant program (GURI) has a goal to bring the best and brightest researchers in the world to the State of Texas. This program is a matching grant program to assist eligible institutions of higher education in recruiting distinguished researchers.

Product Development and Small Business Incubator Fund

The Product Development and Small Business Incubator Fund (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 of Texas.

Telecom, Internet & Cable TV

Providers of internet access, cable television, or telecommunications may qualify for a refund on state sales and use taxes on tangible personal property used for the distribution, provision, or transmission of services.

Data Centers

Property used to operate data centers can qualify for an exemption from state sales and use taxes if the facility meets the State of Texas’ requirements for facility size, job creation, salary levels, capital investment, and facility use.

Solar Energy Franchise Tax Exemption

Corporations engaged exclusively in the manufacturing, sale, or installation of solar energy devices and also meet the requirements set forth by the State of Texas are exempt from the franchise tax.

Film, Video & Audio Production Companies & Broadcasting Companies

A production company may qualify for a sales and use tax exemption on items or services necessary in the production process of audio or visual media. Companies may also qualify for hotel occupancy tax exemptions for extended stays during production and may be eligible for tax refunds or exemptions for fuels used off road.

Economic Development & Diversification In-State Tuition for Employees

For qualified businesses considering relocating or expanding into the State of Texas, the Economic Development & Diversification In-State Tuition for Employees program allows employees and family members to pay in-state tuition rates at public institutions of higher education. The Incentive period lasts for 5 years after the business becomes established.

Federal Incentives

Opportunity Zones

The Opportunity Zone Program was created through the Tax Cuts & Jobs Act of 2017, and is a federal initiative administered by the U.S. Department of Treasury. The program is designed to spur economic development and job creation in distressed communities throughout the United States. The program offers incentives, in the form of capital gains tax abatement, for those who invest eligible capital into Qualified Opportunity Zone assets. For more information, visit the U.S. Treasury Department’s website.

Local Incentives

For Information on local incentives for each Grand Central Texas Community please view the links below: