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Local Incentives

Galveston County Courthouse - Galveston, Texas - Photograph Page 1

Property Tax Abatement:  A tax abatement is a local agreement between a taxpayer and a taxing unit that exempts all or part of the increase in the value of the real property and/or tangible personal property from taxation for a period not to exceed 10 years. Tax abatements are an economic development tool available to cities, counties and special districts to attract new industries and to encourage the retention and development of existing businesses through property tax exemptions or reductions. School districts may not enter into abatement agreements.  Local governments often use property tax abatements to attract new industry and commercial enterprises and to encourage the retention and development of existing businesses. Incorporated cities, counties and special districts are allowed to enter into tax abatement agreements. School districts cannot enter tax abatement agreements. While tax abatements are short-lived, they can have a significant future impact.  Galveston County Commissioners Court adopted Tax Abatement Guidelines on September 16, 2024.  Minimum requirements for consideration of tax abatement include:  creation of 100 jobs with 50 jobs above the average county weekly wage for the past four quarters and capital investment of $25,000,000.  Eligible facilities include manufacturing, research, research and development and regional office. 

Chapter 380 Economic Development Agreements:  Chapter 380 (Section 380.001) of the Local Government Code, authorizes municipalities to offer a range of incentives designed to promote state or local economic development. Specifically, it allows for the provision of loans and grants of city funds, as well as the use of city staff, city facilities or city services, at minimal or no charge.  To establish a loan or grant or to offer discounted or free city services, the city must meet the requirements contained in the Texas Constitution and in applicable Texas statutes. Additionally, cities must review their city charters and any other local provisions that may limit the city’s ability to provide such a grant or loan. To determine the latitude of whether a municipality is able to offer a particular incentive or combination of incentives, local communities should consult their city attorney.  More information: Economic Development Programs (texas.gov) 

Chapter 381 Economic Development Agreements:  Chapter 381 of the Local Government Code allows counties to provide incentives encouraging developers to build in their jurisdictions. A county may administer and develop a program to make loans and grants of public money to promote state or local economic development and to stimulate, encourage and develop business location and commercial activity in the county.  The county also may develop and administer a program for entering into a tax abatement agreement. This tool allows counties to negotiate directly with developers and businesses. More information:   Economic Development Programs (texas.gov) 

Freeport Exemption:  This is an ad valorem property tax exemption on goods, wares, merchandise, ores, certain aircraft and parts, if they have been detained in Texas for 175 days or less for the purpose of assembly, storage, manufacturing, processing, or fabricating.   Several areas in Galveston County provide this exemption. Freeport property includes goods, wares, merchandise, ores and certain aircraft and aircraft parts.  For certain aircraft parts, a community, by official action, may extend the deadline to 730 days.   

Goods-In-Transit Incentive:  House Bill 621 of the 80th Texas Legislature amends the Tax Code and the Government Code to add an exemption from ad valorem taxation for Goods-In-Transit.  To qualify for the exemption, personal property used for assembling, storing, manufacturing, processing or fabricating purposes would have to be acquired in Texas or imported into Texas and stored at a Texas location in which the owner of the goods does not have a direct or indirect ownership interest. The Goods-In-Transit would have to be transported to another location in Texas or out of state no later than 175 days after the property was acquired in or imported into the state. Several taxing entities in Galveston County can provide this exemption.  Oil and gas and their immediate derivatives, aircraft and dealer’s special inventories do not qualify for the exemption. Companies pursuing inventory exemptions may claim either the Freeport or Goods-In-Transit Exemption, not both.  

Public Improvement Districts (PIDs):  Cities and Counties may consider the establishment of Public Improvement Districts (PIDs). PIDs may be created by a municipality or County at the request, or with the consent, of property owners. PIDs allow for the levy of voluntary assessments and the issuance of tax-exempt bonds.  Funds collected through PIDs and any associated bonds may be used for capital improvement projects and maintenance within the geographic area.   

Tax Increment Reinvestment Zones:  Tax increment financing (TIF) is a method local government can use to pay for improvements that will draw private investment to an area. Tax increment financing redirects property tax in a geographic area designated as a Tax Increment Reinvestment Zone (TIRZ) to pay for improvements in the zone. Tax Code Chapter 311 governs tax increment financing.  A TIRZ project jumpstarts development to generate new tax revenue. The benefits of a TIRZ include:  building needed public infrastructure to draw businesses; boosting development, which grows property values and long-term property tax collections; and lessening the cost of private development by providing reimbursement for qualified public improvements.  Future tax revenues from each participating taxing unit are used to pay for the cost of improvements to an area. When the improvements result in additional property tax revenue, this revenue is referred to as the tax increment.  Each taxing unit determines what percentage of its tax increment, if any, it will commit to repay the cost of the financed improvements.  A municipality can designate by ordinance a contiguous or noncontiguous geographic area in its corporate limits as a reinvestment zone. A municipality also can designate a reinvestment zone in the city’s extraterritorial jurisdiction.  A county can designate by order a contiguous geographic area within its borders as a reinvestment zone. 

CenterPoint Energy Rebates:  CenterPoint Energy has multiple energy efficiency rebate programs available on a yearly basis and the Company may be eligible to apply for those programs. Electric Efficiency Incentives | CenterPoint Energy. 

Galveston County Pace Program: Property Assessed Clean Energy (TX-PACE) is a proven financial tool that incentivizes Texas’ property owners to upgrade facility infrastructure with little or no capital outlay. Approved by State legislation and established by your local governments, TX-PACE programs enable owners to lower their operating costs and use the savings to pay for eligible water conservation, energy efficiency, resiliency, and distributed generation projects. Owners gain access to private, affordable, long-term (typically 10-20 years) financing that is not available through traditional funding avenues. Financing for qualified projects under the Program will be provided by qualified third-party lenders chosen by the owners. Such lenders will execute written contracts with the authorized representative to service the debt through assessments, as required by the PACE Act. The contracts will provide for the lenders to determine the financial ability of owners to fulfill the financial obligations to be repaid through assessments, advance the funds to owners on such terms as are agreed between the lenders and the owners for the installation or modification of qualified projects, and service the debt secured by the assessments, directly or through a servicer, by collecting payments from the owners pursuant to financing documents executed between the lenders and the owners.

On-the-Job Training (OJT) through Workforce Solutions (WS): This training program offers participants an opportunity to earn as they learn, while employers benefit from a partial wage reimbursement during the training period.  OJT focuses on jobs that involve new technologies, production, service or additional skills for full-time positions (30 hours per week is considered full-time) paying at least $12.00 per hour or more.  Advantages to the employer include:  no cost access to a carefully screened pool of available talent You set the qualifications, interview, and select the individual; customized training your way, at your workplace; receive a 50% reimbursement of the new employee's wage, up to $21.00 per hour, while they are training (up to 400 hours and based upon the targeted occupation); the average employer reimbursement is $3,000; simple process with minimal paperwork.  WS partners with employers in various industries and locations throughout the 13-county region and offers a team of specialized recruiters to help match skill sets and positions.  WS invites employers from the private non-profit or private sectors with a current state issued tax ID and a recent history of taxable wages on at least three current employees to participate. To get a copy of the eligibility questionnaire, contact talent@wrksolutions.com or call 713-688-6890. OJT is only available for new employees, and training information must be established prior to the start date.  

Workforce Solutions (WS) Employer Service Division can help companies find qualified candidates who are trained and equipped with the right skills to fill your position.  WS can also help companies find solutions for human resources needs, including technical assistance with government regulations and programs, tax incentives and credits, and training for employees. Depending on specific needs, WS Business Consultants work behind the scenes screening candidates for open positions; and can help create job postings that attract qualified applicants for companies.  Consulting Services offered-- a) Specialized Testing:  WS offers many tools and techniques for evaluating job candidates' occupational skills, aptitudes, achievement levels and interests.  Specialized testing is available to employers who want tools to guide decisions about promotions or post-hire training to support retention.   b) Hiring Events:  Companies can meet, interview, and hire in an exciting setting. c) Interview Space:  If your facility is too small or too busy for interview space, WS can provide a professional and convenient location in which to meet with and/or interview your job applicants. d) Customized Training:  WS can train employees with the latest technology and platforms.  you need to enhance your employees' specialized knowledge and skills?  e) Outplacement:  WS can assist with smooth and efficient process for employees involved.  

HGAC Disaster Recovery Funding and Resources:   https://www.h-gac.com/funding/disaster-recovery

HGAC Non-Disaster Funding and Resources:   https://www.h-gac.com/funding/non-disaster

HGAC Local Development Corporation Business Loan Fund: The Business Loan Fund is available for helps finance new or expanding small businesses when traditional funding isn't available or isn't enough. All applicants must have applied for funding from a private lending institution before being considered for the Business Loan Fund. Loan amounts range from $25,000 to $300,000. Higher loan amounts may be considered under special circumstances. A 10% minimum down payment is required. The Business Loan Fund offers interest rates starting at 4% and repayment terms up to 10 years. One job must be created for every $75,000 of loan funds. Eligible Uses of Funds include: purchase of assets including buildings, equipment, furniture and inventory (50% or more of each loan must be used to purchase assets); closing costs; and working capital. HGALDC | Houston-Galveston Area Local Development Corporation

City Incentive Programs