The Texas Enterprise Zone Program is an economic development tool for local communities to partner with the State of Texas to promote job creation and capital investment in economically distressed areas of the state.

The City of Austin City Council has approved 8 Texas Enterprise Zone Program nominations since 2004. Of these, only 2 have been approved by the State of Texas Economic Development Bank.

Designated projects are eligible to apply for state sales and use tax refunds on qualified expenditures. Qualified expenditures include building materials, machinery and equipment, electricity, gas and tangible property purchased and consumed in the normal course of business, and taxable services

The level and amount of refund is related to the capital investment and jobs created at the qualified business site. In addition, local communities must offer incentives to participants under the enterprise zone program, such as tax abatement, tax increment financing, one-stop permitting, and other incentives developed by participating communities.

Local communities must nominate a company as an Enterprise Project to be eligible to participate in the Enterprise Zone Program. Legislation limits the number of projects that can be designated per biennium. The state accepts applications quarterly with deadlines on the first working day of March, June, September, and December.

Communities may nominate projects for a designation period up to five years, non-inclusive of a 90-day window prior to the application deadline. Employment and capital investment commitments must be incurred and met within this timeframe.

Projects may be physically located in or outside of an Enterprise Zone:

  • If located within a zone, the company commits that at least 25% of their new employees will meet economically disadvantaged or enterprise zone resident requirements.
  • If located outside of a zone, the company commits that at least 35% of their new employees will meet economically disadvantaged or enterprise zone residency requirements.

Under limited statutory provisions, an enterprise project designation may be granted for job retention.

State Benefits to Participation

Level of capital investment Maximum number of jobs allocated Maximum potential refund Maximum refund per job allocated
$40,000 to $399,999 10 $25,000 $2,500
$400,000 to $999,999 25 $62,500 $2,500
$1,000,000 to $4,999,999 125 $312,500 $2,500
$5,000,000 to $149,999,999 500 $1,250,000 $2,500
$150,000,000 to $249,999,999 500 $2,500,000 $5,000
$250,000,000 or more 500 $3,750,000 $7,500

For information on the companies the City of Austin has previously nominated under this program, click here.