economyEconomic Development

Report of the Texas Economic Development Act 2025Tax Code Chapter 313

Introduction

In 2001, the Texas Legislature established the Texas Economic Development Act, often called “Chapter 313” for its place in the Texas Tax Code. The Chapter 313 program allows public school districts to offer tax incentives for businesses that make large capital investments and create jobs in Texas communities. The program expired on Dec. 31, 2022.

The 2023 Biennial Report and the 2023 Supplemental Data Report depicted a combined total of 919 active agreements. Of those, 33 percent were for manufacturing and 67 percent were for renewable energy projects. There was one research and development project and four priority projects. No additional agreements were entered into during this two-year reporting period. This report accounts for fewer active agreements than in 2023 as agreements naturally conclude or are terminated.

Out of the total 817 active agreements, 13 projects did not report and are in material breach of their agreement. Of the 804 projects that submitted reports, 34 percent are manufacturing, 66 percent are renewable energy, and slightly less than 1 percent are priority projects.

This report contains information on each of the 804 reporting active agreements made under this chapter as well as aggregate data of these agreements. The information submitted herein is in compliance with Texas Tax Code Chapter 313.032.

Statutory Reporting Requirements

House Bill (HB) 3390 from the 83rd Legislature, Regular Session repealed the reporting requirements in Section 313.008 and amended the reporting requirements in Section 313.032 to encompass all reporting requirements.

Section 313.032. REPORT ON COMPLIANCE WITH AGREEMENTS.

1. Before the beginning of each regular session of the legislature, the comptroller shall submit to the lieutenant governor, the speaker of the house of representatives and each other member of the legislature a report on the agreements entered into under this chapter that includes:
   1. an assessment of the following with regard to the agreements entered into under this chapter, considered in the aggregate:
      1. the total number of jobs created, direct and otherwise, in this state;
      2. the total effect on personal income, direct and otherwise, in this state;
      3. the total amount of investment in this state;
      4. the total taxable value of property on the tax rolls in this state, including property for which the limitation period has expired;
      5. the total value of property not on the tax rolls in this state as a result of agreements entered into under this chapter; and
      6. the total fiscal effect on the state and local governments; and
   2. an assessment of the progress of each agreement made under this chapter that states for each agreement:
      1. the number of qualifying jobs each recipient of a limitation on appraised value committed to create;
      2. the number of qualifying jobs each recipient created;
      3. the total amount of wages and the median wage of the new qualifying jobs each recipient created;
      4. the amount of the qualified investment each recipient committed to spend or allocate for each project;
      5. the amount of the qualified investment each recipient spent or allocated for each project;
      6. the market value of the qualified property of each recipient as determined by the applicable chief appraiser, including property that is no longer eligible for a limitation on appraised value under the agreement;
      7. the limitation on appraised value for the qualified property of each recipient;
      8. the dollar amount of the taxes that would have been imposed on the qualified property if the property had not received a limitation on appraised value; and
      9. the dollar amount of the taxes imposed on the qualified property.
2. The report may not include information that is confidential by law.
   
   (b-1) In preparing the portion of the report described by Subsection (a)(1), the comptroller may use standard economic estimation techniques, including economic multipliers.
3. The portion of the report described by Subsection (a)(2) must be based on data certified to the comptroller by each recipient or former recipient of a limitation on appraised value under this chapter.
4. The comptroller may require a recipient or former recipient of a limitation on appraised value under this chapter to submit, on a form the comptroller provides, information required to complete the report.

The purpose of the Chapter 313 program is expressly laid out in Section 313.003 of the Texas Tax Code. The program is intended to:

1. encourage large-scale capital investments in this state;
2. create new, high-paying jobs in this state;
3. attract to this state large-scale businesses that are exploring opportunities to locate in other states or other countries;
4. enable state and local government officials and economic development professionals to compete with other states by authorizing economic development incentives comparable to incentives being offered to prospective employers by other states and to provide state and local officials with an effective means to attract large-scale investment;
5. strengthen and improve the overall performance of the economy of this state;
6. expand and enlarge the ad valorem property tax base of this state; and
7. enhance this state’s economic development efforts by providing state and local officials with an effective local economic development tool.

Aggregate Data

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Table 1 pertains to Section 313.32(a)(1) and aggregates data for agreements entered into under Chapter 313 through Dec. 31, 2022, and active as of June 1, 2024.

Table 1

2023 Aggregate Data

Category	Reported Amount
Total number of jobs created, direct and otherwise, in this state in 2023.i	160,200
Total effect on personal income, direct and otherwise, in this state in 2023.	$9,097,528,000
Total amount of investment in this state reported through 2023.	$197,807,528,000
Total taxable value of qualified property on the tax rolls in this state in 2023, including property for which the limitation period has expired.	$20,229,665,000
Total value of qualified property not on the tax rolls in this state in 2023 as a result of agreements entered into under this chapter.	$86,955,541,000
Total fiscal effect on the state and local governments through 2023.ii	$2,321,139,000

Note: Total number of jobs created is rounded to the nearest hundred. All other figures have been rounded to the nearest thousand.

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ⁱ The multipliers used in this analysis were the direct-effect employment and direct-effect earnings RIMS II Industry Multipliers for Texas (https://apps.bea.gov/regional/rims/rimsii/). These multipliers represent the estimated change in employment (earnings) that occur given the number (amount) of direct Chapter 313 jobs (earnings).

The estimates listed in this table represent the product of the direct jobs (earnings) by industry and their corresponding RIMS II state-level multipliers. No attempt has been made by the Comptroller’s office to modify or change the values of these multipliers.

To obtain a copy of these state-level multipliers, please visit the URL above to access the U.S. Department of Commerce’s Bureau of Economic Analysis.

ⁱⁱ The fiscal effect calculation is the total Maintenance and Operations (M&O) taxes and Interest and Sinking fund (I&S) taxes reported by a company through 2023.

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