Chapter 380 of the Local Government Code authorizes municipalities to offer incentives designed to promote economic development such as commercial and retail projects. Specifically, it provides for offering loans and grants of city funds or services at little or no cost to promote state and local economic development and to stimulate business and commercial activity.
In order to provide a grant or loan, a city must establish a program to implement the incentives. Before proceeding, cities must review their city charters or local policies that may restrict a city's ability provide a loan or grant.
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.
In May 2021, the 87th Texas Legislature passed House Bill 2404, which went into effect Sept. 1, 2021, and requires the Texas Comptroller of Public Accounts to create and make accessible an online database for local governments to report their economic development agreements authorized by either Chapter 380 or Chapter 381 of the Local Government Code.
In late October, our office will send notice to all cities and counties with instructions on filing agreements entered into, amended or renewed after Sept. 1, 2021. Chapter 380 and Chapter 381 agreements implemented before the effective date of the law must be filed by Jan. 1, 2022. The law requires local governments to report required information within 14 days of entering into, amending or renewing an agreement. The Comptroller will grant a blanket waiver on filing deadlines until the reporting tool is available for use.
The Texas Comptroller will not accept paper copies or emails of the agreements while our office diligently works to create an online reporting tool by Nov. 30, 2021.
For additional information, contact the Data Analysis and Transparency Division via email or at 844-519-5672, ext. 6-9231.
In 2015, the Texas Legislature passed House Bill 855, which requires state agencies to publish a list of the three most commonly used Web browsers on their websites. The Texas Comptroller’s most commonly used Web browsers are Google Chrome, Microsoft Internet Explorer and Apple Safari.