Local incentives and economic development

Everything in this section is local, discretionary and negotiated. A city grants it or a county grants it, the decision belongs to whichever body grants it, and no business is entitled to any of it. The Texas Comptroller of Public Accounts awards none of these and nor does any other state office. A firm arriving in expectation of a program has misread the thing.

Which is why the useful division here is not between one incentive and another. It runs between what a business can read before it walks into a negotiation and what it cannot. More of the first exists than owners expect, because the statutes prescribe public procedure in detail. Almost none of the second is published anywhere, and pages that appear to publish it are usually repeating figures nobody sourced. Where this sits among everything else a North Texas company deals with is laid out on the page that lists every section of this publication.

On the record

The statutes, and which level of government each one hands the power to

Local Government Code Chapter 380 authorizes municipalities to offer loans and grants of city funds or services at little or no cost to promote state and local economic development. Chapter 381 allows counties to negotiate directly with developers and businesses to provide incentives encouraging developers to build in their jurisdictions. The first is a municipal power and the second a county power, and neither is a state grant in local clothing.

What an abatement is, and who is allowed to grant one

Property tax abatement is a third thing again, and it lives in the Tax Code rather than the Local Government Code. The Comptroller calls Tax Code Chapter 312 the Property Tax Abatement Act and defines an abatement as a local agreement between a taxpayer and a local taxing unit that exempts all or part of the increase in the value of property from taxation for a period not to exceed 10 years. Cities, counties and special districts may grant one. School districts may not. Order of play follows the property: inside city limits the city must grant an abatement before any other taxing unit is allowed to, outside both the city limits and the city's extraterritorial jurisdiction the county must go first, and inside that jurisdiction any taxing unit may. The Comptroller approves none of it, and keeps the central registry that chief appraisers report zones and executed agreements into.

The procedure is itself public, which is the part most worth knowing. A taxing unit adopts guidelines and criteria before granting anything. Designating a reinvestment zone takes a seven-day newspaper notice and a seven-day written notice to the other taxing units before the hearing. No unit may enter an agreement until it has adopted a resolution electing to become eligible to participate. Approving the agreement takes at least 30 days of public notice of the meeting, plus written notice and a copy of the proposed agreement to the other taxing units at least seven days in advance. Anyone watching a deal, whether a competitor or a resident, can follow all of it from the agenda.

Where executed agreements can be looked up

Cities and counties report their economic development agreements under Local Government Code Chapters 380 and 381, and their abatement agreements under Tax Code Chapter 312, to a searchable Comptroller database. Anything entered, amended or renewed after January 1, 2022 must be reported within 14 days, on the authority of HB 2404 and Government Code Section 403.0246(c), and a local government failing to comply may face a civil penalty of $1,000. Abatement reporting runs to a different clock, before July 1 of the year after the zone is designated or the agreement executed. One limit matters: the duty reaches only agreements from 2022 onward, so the database is no complete historical record of what North Texas cities have signed and should not be described as one.

Not on the record

What no page consulted publishes

No page read for this section states any statutory cap on the size of a Chapter 380 or 381 incentive. Nor does any Comptroller page consulted describe a route by which a business applies to the state for one, which is an absence of evidence rather than a stated prohibition, and either way the negotiation on offer is with a city or a county. What a local government will actually agree to is settled case by case, and the missing number is not an oversight. Discretion is the mechanism.

What the cities publish, and what this publication could not read

Dallas publishes a written incentive policy through its economic development office and Fort Worth publishes a written policy governing its economic development program agreements. Neither could be opened in the research behind these pages, so no clause, threshold or program name from either appears on this site, and the Fort Worth minimum investment and average wage figures in general circulation were never read on a city page. No Arlington policy was located at all, and whether every city in the metroplex publishes one is not established. Reporting an executed agreement to the Comptroller is a legal duty. Publishing a policy is a separate thing, and a city doing the first has not necessarily done the second.

The state program a business cannot apply to on its own behalf

The Texas Enterprise Zone Program is a state sales and use tax refund program designed to encourage private investment and job creation in economically distressed areas, and the Comptroller administers all of its refunds. Local discretion still governs the door. Texas communities nominate companies in their jurisdiction by submitting an application on the company's behalf, and a business cannot apply for itself. Applications close on the first business day of March, June, September and December, and the nominating community pays a non-refundable fee whose amount the program page does not publish. The investment tiers, job allocation caps and per-job refund amounts that circulate for this program were not read as text on that page, so this publication states no dollar figure for any of them.

One citation repays checking whenever it turns up. Abatement belongs to the Tax Code, and pages placing Chapter 312 in the Local Government Code have it wrong, which happens often enough to be worth noticing before quoting anybody.