TITLE 13. CULTURAL RESOURCES

PART 8. TEXAS FILM COMMISSION

CHAPTER 121. TEXAS MOVING IMAGE INDUSTRY INCENTIVE PROGRAM

The Office of the Governor ("OOG") adopts amendments to 13 Texas Administrative Code §121.1, concerning Background and Purpose, §121.2, concerning Definitions, §121.3, concerning Eligible Projects, §121.4, concerning Ineligible Projects, §121.5, concerning Eligible and Ineligible In-State Spending, §121.6, concerning Grant Awards, §121.7, concerning Additional Grant Awards, §121.8, concerning Grant Application, §121.9, concerning Processing and Review of Applications, §121.10, concerning Disqualification of an Application, and §121.14, concerning Revocation and Recapture of Incentives.

The amendments to §§121.1, 121.2, 121.4, 121.6, 121.9, 121.10, and 121.14 are adopted without changes to the proposed text as published in the February 13, 2026, issue of the Texas Register (51 TexReg 793). These rules will not be republished.

The amendments to §§121.3, 121.5, 121.7 and 121.8 are adopted with changes to the proposed text as published in the February 13, 2026, issue of the Texas Register (51 TexReg 793). These rules will be republished.

The OOG also adopts the repeal of §121.13, concerning Texas Heritage Project, elsewhere in this issue.

REASONED JUSTIFICATION

The Texas Moving Image Industry Incentive Program ("TMIIIP") was implemented to increase employment opportunities for Texas industry professionals, encourage tourism to the state, and boost economic activity in Texas cities and the overall Texas economy. The 89th Legislature passed Senate Bill 22, which created the Texas Moving Image Industry Incentive Fund appropriating to TMIIIP $300M each biennium until 2035. The new legislation also changed the residency threshold requirement for crew, actors, and extras from this state from 55% to 35% for the period of September 1, 2025, through August 31, 2027, to be increased by 5% each subsequent biennium until reaching 50% beginning on September 1, 2031. In addition, content requirements and additional grant awards were created for projects accepted into the program. The adopted amendments to §121.3 align the rule with section 485.023, Texas Government Code, as modified by the 89th Legislature. This rulemaking incorporates most of the changes made by Senate Bill 22, clarifies existing language, and makes other non-substantive updates for style and grammar.

The adopted amendments to §121.1 make non-substantive updates to style and grammar.

The adopted amendments to §121.2 add definitions related to changes made by Senate Bill 22, and modifies other definitions to better align them with the purpose of the program and to account for changes in the industry. The amendments also update outdated language and make non-substantive updates to style and grammar.

The adopted amendments to §121.3 clarify language related to activities that are eligible for TMIIIP grants and require applicants to follow all requirements and best practices set forth in the Texas Film Commission Program Guidelines. The amendments further update outdated language and make non-substantive updates to style and grammar. This adoption also removes additional grammatical errors present in the proposed rulemaking.

The adopted amendments to §121.4 make clarifying changes, align language with the OOG's current procedures, and insert non-substantive updates to style and grammar.

The adopted amendments to §121.5 clarify the lists of eligible and ineligible in-state expenditures under the program. The adopted amendments also make non-substantive updates to style and grammar. The adopted amendments also clarify that payroll company service fees are generally ineligible unless the payroll company that generates the service fee is a Texas-based company and correct additional grammatical errors present in the proposed rulemaking.

The adopted amendments to §121.6 revise the potential grant amounts and corresponding budget tiers for all eligible projects in accordance with changes made by Senate Bill 22. The adopted amendments also make non-substantive updates to style and grammar.

The adopted amendments to §121.7 add new grant categories to the existing options for Applicants to receive one or more additional grants, to the extent the total grant amounts do not exceed 31% of the total in-state spending. The additional options relate to: (1) the Rural Filming Grant; (2) the Texas Historic Site Grant; and (3) the Workforce Development Grant. Consistent with section 485.025 of the Texas Government Code, as amended by Senate Bill 22, the rules establish that an Applicant may qualify for multiple options, but may not receive additional grants in amounts that exceed 31% of the total in-state expenditures for the project. Senate Bill 22 also created the Texas Heritage Grant and Faith-Based Moving Image Project Grant; those additional incentives will be addressed in a future rulemaking by the OOG. The adopted amendments also make non-substantive updates to style and grammar.

The adopted amendments to §121.8 make non-substantive updates to style and grammar.

The adopted amendments to §121.9 remove unnecessary, redundant language and make other non-substantive updates to style and grammar.

The adopted amendments to §121.10 make non-substantive updates to style and grammar.

The adopted amendments to §121.14 make non-substantive updates to style and grammar.

SUMMARY OF COMMENTS

The public comment period for the proposed amendments opened on February 13, 2026, and closed on March 15, 2026. The OOG received comments from two film non-profits and a trade association. The film non-profits supported the rulemaking and the trade association did not express whether it supported the rulemaking or not. The comments are summarized below.

Comment: One commenter for a film non-profit strongly supports the changes made under Senate Bill 22 and the leadership the OOG has exhibited in supporting the future of filmmaking in Texas.

Response: The OOG appreciates the commenter's support and encourages the commenter to submit its suggestions for statutory changes to the Texas Legislature for its consideration in a future legislative session.

Comment: A commenter representing a film non-profit expressed support for the OOG's proposed changes.

Response: The OOG appreciates the commenter's support.

Comment: The trade association's comments noted the proposed rule §121.3 provided for "60% of actual locations used and paid for" as a basis for eligibility, as long as minimum spending requirements are satisfied. The commenter indicated the rule text was not clear whether that "60%" requirement could be met by ensuring at least six out of ten shooting locations were in the State.

Response: Each project is unique and circumstances may vary, but, generally, an applicant may be eligible for a grant if it fulfills all other eligibility requirements and locates at least six out of every ten filming locations in Texas, not including basecamps. However, a grantee may only be eligible under this option with authorization from the OOG. The OOG has determined the rule text is sufficiently clear and will not make changes in response to this comment.

Comment: The trade association recommended that the OOG modify the text of §121.5 as proposed to distill the varying standards for eligible in-state spending to a single standard that permits an expense to be eligible so long as the supply originates from a business, including a sole proprietor that has a physical location in Texas that is not a P.O. Box. Specifically, the commenter suggests that, under § 121.5(a)(4), payroll company service fees should be eligible using the same definition--a company operating a "physical business location in Texas"--rather than a "Texas-based payroll company." The commenter suggests a change to that provision would ensure consistency with §121.5(b)(12), as proposed to be amended, which provides that "[p]ayroll company or workers' compensation company service fees paid to a company that does not operate a physical business location in Texas" are not eligible expenses.

Response: Under §121.1(b), the purposes of TMIIIP are to increase employment opportunities for Texas industry professionals, encourage tourism to the state, and boost economic activity in Texas cities and the overall Texas economy. With this purpose in mind, the OOG proposed each of the qualifications at issue based on its extensive experience administering TMIIIP and the nature of businesses within the industries relevant to the respective expenditure categories. However, the OOG agrees that consistency regarding the contact a payroll company must have with Texas before its service fees are eligible for reimbursement would benefit stakeholders and the public. Accordingly, the OOG has updated §121.5(b)(12) to clarify that service fees charged by non-Texas-based payroll companies are generally not eligible expenditures.

Comment: The trade association recommended that, instead of solely evidencing the appropriate disposition of a capital asset, the OOG offer an option in §121.5(a)(12) that includes as part of the incentive calculation the cost of acquisition reduced in accordance with the asset's use in-state over the depreciable life of the asset.

Response: The commenter's suggestion creates a new category of eligible cost, and its inclusion would require a substantive change to the rules as proposed. Accordingly, the OOG declines to modify § 121.5(a)(12) in response to this commenter's suggestion but may address additional eligible cost categories in a future rulemaking.

Comment: The trade association suggested increasing the threshold above which an item is considered a capital asset from $1,000 to $10,000.

Response: Industry practice is that single items of equipment or other purchases of $1000 or more are still generally considered capital assets. Accordingly, to align with industry practice, the OOG declines to make any changes in response to the commenter's suggestions.

Comment: The trade association suggests that, under §121.7, applicants should be provided with the option to combine two or more additional grant awards to earn a 2.5% uplift. Specifically, the commenter suggests modifying the rule to allow an applicant to receive a 2.5% uplift if it partially, but not completely, satisfies the requirements of at least two additional grants offered under §121.7.

Response: Although several of the additional grant award categories authorized by statute provide for administration through administrative rule adopted by the OOG, each additional award carries statutorily prescribed minimum qualifications. The statute enabling additional grant award uplifts does not authorize the OOG to provide additional grant awards for only partial compliance with statutory minimums. The OOG appreciates the commenter's suggestion, but is prohibited from making the recommended change.

Comment: In relation to proposed §121.9, the trade association notes that some state programs provide applicants assurances that, while the agency reviews a grant, the potential grant funds are tentatively set aside for the applicant until the initial application process is completed. The commenter respectfully recommends that the OOG include a provision that specifies that, when the OOG deems an application complete, the OOG will send a letter or other form of notification to the applicant conveying an initial conditional approval as of a specified date.

Response: The OOG currently sends grant conditional award letters, and continues to refine its processes to ensure expeditious transmission of those letters. Because this practice is already established in its administrative practices, the OOG declines to make the change suggested by the commenter.

Comment: The trade association suggested that §121.14 be modified to establish that the OOG would only recapture or claw back funds paid as an incentive to a grantee if occur if the OOG determines that the grantee materially misrepresented facts or made a fraudulent statement or statements.

Response: The Texas Constitution requires the OOG implement proper controls for all grants to ensure the purposes of each grant the OOG provides are achieved, including the ability to recoup funds the OOG determines were used for ineligible purposes. Accordingly, the OOG may not make changes in response to the commenter's recommendation because the suggested reasons for recapture do not encompass all reasons the OOG may need to claw back funds.

STATUTORY AUTHORITY

The amendments are adopted under Section 485.022 of the Texas Government Code, which requires the Texas Film Commission to develop procedures for the administration and calculation of grant awards under TMIIIP. The amendments are also adopted in accordance with Senate Bill 22, which took effect on September 1, 2025.

CROSS REFERENCE TO STATUTE

Chapter 485 of Texas Government Code. No other statutes, articles, or codes are affected by the adopted amendments.

§ 121.3. Eligible Projects.

(a) A project may be eligible for a grant under the Texas Moving Image Industry Incentive Program if it meets the stated minimum requirements listed in subsections (b) - (h) of this section, is appropriate in content, and represents a potential economic impact in Texas, as assessed in §121.9(c)(3) of this chapter (related to Processing and Review of Applications), that is sufficient to justify acceptance in the program.

(b) Feature Films.

(1) Feature Film Applicants must expend a minimum of $250,000 in in-state spending.

(2) Feature Film Applicants must demonstrate at least 60% of a project is filmed in Texas. The Applicant must fulfill this requirement by either:

(A) completing at least 60% of Filming Days in Texas; or

(B) if the Texas Film Commission (Commission) provides prior written approval:

(i) completing at least 60% of the total project Man Hours in Texas; or

(ii) locating in Texas at least 60% of the actual locations used and paid for, not including basecamps.

(3) Except as provided in paragraph (4) of this subsection, a Feature Film Applicant must demonstrate it has met the required residency percentage specified in Section 485.023(2), Texas Government Code. The required percentages of the Crew paid by the Applicant and of the Cast, including extras, paid by the Applicant must be verified Texas Residents, unless the Commission certifies in writing that a sufficient number of qualified Crew and Cast, including extras, are not available; and the Applicant has made every effort to meet the requirements and follow best practices prescribed by the Texas Film Commission Program Guidelines to obtain Crew and Cast who are Texas Residents.

(4) For animated or documentary Feature Films, a Feature Film Applicant must demonstrate it has met the required residency percentage specified in Section 485.023(2), Texas Government Code. The percentage of the combined total of Crew and Cast, including extras, paid by the Applicant must be verified Texas Residents unless it the Commission certifies in writing, that qualified Crew and Cast are not available; and the Applicant has made every effort to meet the requirements and follow best practices prescribed by the Texas Film Commission Program Guidelines to obtain Crew and Cast who are Texas Residents.

(1) Television Program Applicants must expend a minimum of $250,000 in in-state spending.

(2) 60% of the project must be filmed in Texas. This must be fulfilled by completing at least 60% of the Filming Days in Texas, or, if permitted by the Commission in its sole discretion:

(A) completing at least 60% of the total Man Hours in Texas; or

(B) locating in Texas at least 60% of the actual locations used and paid for, not including basecamps.

(3) Except as provided in paragraph (4) of this subsection, the percentage of the Crew paid by the Applicant and percentage of the Cast, including extras, paid by the Applicant must be Texas Residents, unless it is determined and certified by the Commission in writing that a sufficient number of qualified Crew and Cast, including extras, are not available and every effort has been made by the production to meet the requirements and best practices as prescribed by the Texas Film Commission Program Guidelines. Applicants must demonstrate they meet residency requirements as outlined in subsection (b)(3) of this section.

(4) For animated or documentary Television Programs, applicants must demonstrate they meet the residency requirements as outlined in subsection (b)(3) of this section. The percentage combined total of Crew and Cast paid by the Applicant, including extras, must be Texas Residents, unless it is determined and certified by the Commission in writing that qualified Crew and Cast are not available, and every effort has been made by the production to meet the requirements and best practices as prescribed by the Texas Film Commission Program Guidelines.

(d) Reality Television Projects.

(1) Reality Television Project Applicants must expend a minimum of $250,000 in in-state spending.

(2) 60% of the project must be filmed in Texas. This must be fulfilled by completing at least 60% of the Filming Days in Texas, or, if permitted by the Commission in its sole discretion:

(A) completing at least 60% of the total Man Hours in Texas; or

(B) locating in Texas at least 60% of the actual locations used and paid for, not including basecamps.

(3) Applicants must demonstrate that they meet the residency requirements outlined in subsection (b)(3) of this section. The percentage of the combined total of Crew and Cast, including extras, paid by the Applicant, must be Texas Residents, unless it is determined and certified by the Commission, in writing, that a sufficient number of qualified Crew and Cast, including extras, are not available and every effort has been made by the production to meet the requirements and best practices as prescribed by the Texas Film Commission Program Guidelines.

(e) Commercials.

(1) Commercial Applicants must expend a minimum of $100,000 in in-state spending.

(2) 60% of the project must be filmed in Texas. This must be fulfilled by completing at least 60% of the Filming Days in Texas, or, if permitted by the Commission in its sole discretion:

(A) completing at least 60% of the total Man Hours in Texas; or

(B) locating in Texas at least 60% of the actual locations used and paid for, not including basecamps.

(3) Applicants must demonstrate the residency requirements as outlined in subsection (b)(3) of this section. The percentage of the combined total of Crew and Cast, including extras, paid by the Applicant must be Texas Residents, unless it is determined and certified by the Commission in writing that a sufficient number of qualified Crew and Cast, including extras, are not available and every effort has been made by the production to meet the requirements and best practices as prescribed by the Texas Film Commission Program Guidelines.

(f) Digital Interactive Media Productions.

(1) Digital Interactive Media Production Applicants must expend a minimum of $100,000 in in-state spending.

(2) 60% of the project must be filmed in Texas. This must be fulfilled by completing at least 60% of the Filming Days in Texas, or, if permitted by the Commission in its sole discretion:

(A) completing at least 60% of the total Man Hours in Texas; or

(B) locating in Texas at least 60% of the actual locations used and paid for, not including basecamps.

(3) Applicants must demonstrate they meet the residency requirements as outlined in subsection (b)(3) of this section. The percentage of the combined total of Crew and Cast, including extras, paid by the Applicant must be Texas Residents, unless it is determined and certified by the Commission in writing that qualified Crew and Cast are not available and every effort has been made by the production to meet the requirements and best practices as prescribed by the Texas Film Commission Program Guidelines.

(g) Educational or Instructional Videos.

(1) Educational or Instructional Video Applicants must expend a minimum of $100,000 in in-state spending.

(2) 60% of the project must be filmed in Texas. This must be fulfilled by completing at least 60% of the Filming Days in Texas, or, if permitted by the Commission in its sole discretion:

(A) completing at least 60% of the total Man Hours in Texas; or

(B) locating in Texas at least 60% of the actual locations used and paid for, not including basecamps.

(3) Applicants must demonstrate that they meet the residency requirements as outlined in subsection (b)(3) of this section. The percentage of the combined total of Crew and Cast, including extras, paid by the Applicant, must be Texas Residents, unless it is determined and certified by the Commission in writing that qualified Crew and Cast are not available and every effort has been made by the production to meet the requirements and best practices as prescribed by the Texas Film Commission Program Guidelines.

(h) Visual Effects Projects.

(1) Visual Effect Project for a Feature Film or Television Program:

(A) Applicants must expend a minimum of $250,000 in in-state spending.

(B) 60% of the project must be filmed in Texas. This must be fulfilled by completing at least 60% of the Filming Days in Texas, or, if permitted by the Commission in its sole discretion:

(i) completing at least 60% of the total Man Hours in Texas; or

(ii) locating in Texas at least 60% of the actual locations used and paid for, not including basecamps.

(C) The Applicant must demonstrate they have met the residency requirements outlined in subsection (b)(3) of this section. The percentage of the Crew paid by the Applicant and percentage of the Cast, including extras, paid by the Applicant must be Texas Residents, unless it is determined and certified by the Commission in writing that a sufficient number of qualified Crew and Cast, including extras, are not available and every effort has been made by the production to meet the requirements and best practices as prescribed by the Texas Film Commission Program Guidelines.

(2) Visual Effect Project for an Educational or Instruction Video or Commercial:

(A) Applicants must expend a minimum of $100,000 in in-state spending.

(B) 60% of the project must be filmed in Texas. This must be fulfilled by completing at least 60% of the Filming Days in Texas, or, if permitted by the Commission in its sole discretion:

(i) completing at least 60% of the total Man Hours in Texas; or

(ii) locating in Texas at least 60% of the actual locations used and paid for, not including basecamps.

(C) The Applicant must demonstrate that they have met the residency requirements outlined in subsection (b)(3) of this section. The percentage of the combined total of Crew and Cast, including extras, paid by the Applicant must be Texas Residents, unless it is determined and certified by the Commission in writing that a sufficient number of qualified Crew and Cast, including extras, are not available and every effort has been made by the production to meet the requirements and best practices as prescribed by the Texas Film Commission Program Guidelines.

§ 121.5. Eligible and Ineligible In-State Spending.

(a) The following are eligible expenditures:

(1) Wages paid to Texas Residents for work performed in Texas, including additional compensation paid as part of a contractual or collective bargaining agreement.

(2) Additional compensation or reimbursements paid to Texas Residents, including, but not limited to:

(A) mileage or car allowance;

(B) housing allowance; and

(3) Workers compensation insurance premiums for Texas Residents, but only if the premiums are paid to a company operating a physical business location in Texas.

(4) Payroll company service fees for Texas Residents, but only if paid to a Texas-based payroll company that processes payroll within Texas.

(5) Payments made to Texas Domiciled Entities, sole proprietorships, or individuals for goods and services used in Texas that are directly attributable to the Physical Production of the project. In the case of Digital Interactive Media Productions, Visual Effects Projects, and animated projects, the amount attributable to Pre-Production and research and development costs shall be limited to an amount not to exceed 30% of the project's overall in-state spending.

(6) Payments for shipping on shipments originating in Texas.

(7) Air travel to and from Texas on a Texas-based airline or on a Texas-based air charter service, provided that an itemized receipt showing an itinerary and passenger name from the airline is provided confirming payment.

(8) Rentals of vehicles registered and licensed in the State of Texas or rented from a Texas Domiciled Entity or sole proprietorship, including, but not limited to, national rental car companies operating one or more physical business locations at verifiable Texas addresses that are not P.O. Boxes.

(9) Fees paid to Texas Residents to compose, orchestrate, and perform music that is specifically created for the project.

(10) Legal fees directly attributable to the Physical Production of the project that are paid to Texas-based lawyers or law firms.

(11) Internet purchases, but only if purchased from an entity or sole proprietorship or a retailer with a physical store or outlet in Texas. Items purchased must be shipped directly to Texas.

(12) Capital expenditures for purchases from a business or sole proprietorship physically located in Texas that are:

(A) less than $1,000 for an individual item; or

(B) equal to or greater than $1,000 for an individual item purchased that is not exhausted during the course of Production, so long as such item is sold or appropriately disposed of at the end of Production and evidence of such sale or disposition is furnished to the Texas Film Commission (Commission). Evidence of sale or disposition must show that only the difference between the purchase price and the sale price is submitted as an eligible expenditure and a copy of the check or receipt for the sale must be included as back up with the original purchase documentation.

(13) Location fees, if an executed location agreement by and between the Applicant and the location owner or owner's representative is provided to the Commission with the Applicant's Expended Budget.

(b) The following are ineligible expenditures:

(1) Payments made to entities, to include a sole proprietorship or individual, not having a physical location in Texas, and to non-Texas Residents.

(2) Payments made for goods and services not used in Texas.

(3) Payments made for goods and services that are not directly attributable to the Physical Production of the project.

(4) Payments made by Digital Interactive Media Productions, Visual Effects Projects, and animated projects for Pre-Production costs that exceed 30% of the project's overall in-state spending.

(5) Expenses related to distribution, publicity, marketing, or promotion of the project, including, but not limited to, promotional stills.

(6) Payments, other than properly allowable location fees, for facilities and automobiles that are part of a permanent/continuous business operation including, but not limited to, rental, lease or mortgage payments, utilities, software, and insurance.

(7) Wages paid to non-Texas Residents, including additional compensation paid as part of a contractual or collective bargaining agreement.

(8) Payments made to a company, entity, association, or person that acts as an agent or broker for companies, entities, associations, or persons outside of Texas to provide goods, services, or labor for the purpose of utilizing the Texas Moving Image Industry Incentive Program to their benefit (also known as "pass-through" entities).

(9) Fees for story rights, music rights, or clearance rights and licensing fees.

(10) Additional compensation or reimbursements paid to non-Texas Residents, including, but not limited to:

(A) mileage or car allowance;

(B) housing allowance; and

(11) Workers' compensation insurance payments for non-Texas Residents.

(12) Payroll company services fees paid to a company that is not based in Texas, or workers' compensation company service fees paid to a company that does not operate a physical business location in Texas.

(13) Payments for shipments originating outside of Texas.

(14) Payments for mobile and landline telephone service if the service address is not in Texas.

(15) Payments for alcoholic beverages, cigarettes, and tobacco products.

(16) Payments to adult-oriented businesses or for adult-oriented material.

(17) Payments for entertainment, including, but not limited to, parties, event tickets, movies, hotel mini-bar items, meals unrelated to the Physical Production of the project, and personal gifts.

(18) Payments for tips and gratuities.

(19) Capital expenditures for an individual item over $1,000 which item is not exhausted during the course of Production, unless purchased in Texas, the item is sold at the end of the Production and evidence of such sale is furnished to the Commission. The documentation provided to the Commission must show that only the difference between the purchase price and the sale price is submitted as an eligible expenditure and a copy of the check or receipt for the sale should be included as back up with the original purchase documentation.

(20) Payments to any business that sells alcohol or tobacco products reflected on receipts which are not itemized, even if the submitted item itself is otherwise eligible.

(21) Any "talent handling fees," "overage fees," and "production fees" for a Commercial where the Applicant is a Production Company rather than the client or advertisement agency, other than the following items which must have been budgeted on the original, awarded bid to be eligible expenditures: the Applicant's insurance fees from the actual column of the actual Association of Independent Commercial Producers (AICP) budget (if it does not exceed the original, awarded bid and if a Texas-based insurance company or broker is used); editorial or Postproduction fees from the actual column of the AICP budget (if such fees do not exceed the Postproduction fees on the original, awarded bid); and any bona fide internal billing items which do not exceed the usual and customary cost of the goods or services, such as when Production Company employees work directly on the production using equipment and/or studio space owned by the Applicant that is "rented" to the production in lieu of using an outside vendor.

(22) Any payments made other than by the Applicant, including, but not limited to, payments made on behalf of the Applicant by a third party, unless a production services agreement or similar documentation is provided to show sufficient proof, as determined by the Commission in its sole discretion, of the relationship between the Applicant and the third party.

§ 121.7. Additional Grant Awards.

An applicant may be eligible for one or more additional grants. The total grant amount a project may receive will be equal to an amount no greater than 31% of total in-state spending by meeting one or more of the following:

(1) Rural Filming Grant--Projects that complete at least 35% of total Filming Days or Man Hours in a county in this state with a population of 300,000 or less may receive an additional 2.5% of total in-state spending.

(2) Texas Veterans Grant--Projects demonstrating that 5% of the combined total of paid Crew and paid Cast, including extras, who are paid by the Applicant are Texas Resident Veterans may receive an additional 2.5% of total in-state spending.

(A) For purposes of this section, a Veteran is a person who served in and has been honorably discharged from the United States Army, Navy, Marine Corps, Air Force, or Coast Guard; the National or Air National Guard of the United States; the Texas Army National Guard; the Texas Air National Guard; a Reserve component of any of the aforementioned military organizations; or any other military service that the Texas Film Commission (Commission) determines to be allowable.

(B) The Applicant shall submit sufficient information confirming the Veteran's status, including military-issued discharge documentation and other information requested by the Commission to support a determination that the person qualifies as a Veteran.

(3) Texas Historic Site Grant--Projects utilizing historic sites in this state as filming locations for 5% or more of total production days may receive an additional 2.5% of total in-state spending. To qualify for a grant under this section, filming locations must:

(A) be used for filming and not basecamps; and

(B) have either a Historic Designation from the Texas Historical Commission or be listed on the National Historic Places Register as administered by the Texas Historical Commission in conjunction with the National Parks Service.

(4) Workforce Development Grant--Projects partnering with a Texas Institution of Higher Education to provide moving image industry workforce development opportunities during the production of the project may receive an additional 2.5% of total in-state spending. To qualify for a grant under this section, a project must satisfy workforce development training criteria as determined by the Commission.

(5) Postproduction Grant--Projects expending 25% of the total eligible in-state spending on eligible expenditures during Postproduction, including labor, vendors, and music costs. Costs associated with utilizing Texas music may receive an additional 1% of total in-state spending.

§ 121.8. Grant Application.

(a) Initial Submission.

(1) A Qualifying Application includes:

(A) A completed Qualifying Application form for the Texas Moving Image Industry Incentive Program;

(B) An itemized budget detailing only estimated Texas expenditures; and

(i) for Feature Films, Television Programs (except Episodic Television Series) and Visual Effects Projects for Feature Films and Television Programs: the full script;

(ii) for Episodic Television Series: the full script of the first episode in the series to be filmed in Texas and, if requested, full scripts for subsequent episodes to be filmed in Texas;

(iii) for Commercials, Educational or Instructional Videos, and Visual Effects Projects for Commercials or Educational or Instructional Videos: the scripts, storyboards, or detailed outlines/summaries of content;

(iv) for Digital Interactive Media Productions: a summary of game content providing sufficient detail concerning the platform, themes, settings, story, characters, and events; or

(v) for Reality Television Projects: a detailed treatment or outline of program content.

(2) Application forms for each type of project are available by request to the Commission via telephone, Internet, or other means if additional special needs facilitation is required.

(3) Applications shall not be accepted earlier than 180 calendar days prior to a project's Principal Start Date.

(4) Applications must be received no later than 5:00 p.m. Central Time on the fifth Business Day prior to the Principal Start Date.

(5) Only one application by a single Applicant is allowed for a project.

(6) Within 5 Business Days of the Principal Start Date indicated on the Qualifying Application form, an Applicant for a Feature Film, Television Program, Reality Television Project, Digital Interactive Media Production, Visual Effects Project or Educational or Instructional Video must confirm with the Texas Film Commission (Commission) in writing, to include e-mail, that the production began on time. If the start of the project is delayed for more than 30 days, an application may be disqualified, and the Applicant may be required to reapply. If an Applicant fails to confirm that the production began on time within such 5 Business Day period, the Commission may, at its sole election but with no obligation to do so, disqualify the application.

(b) The Office of the Governor, as a state agency, must comply with the Texas Public Information Act (the "Act"). In the event that a public information request related to the Applicant and/or the application is submitted to the agency, the Office of the Governor shall notify the Applicant within a reasonable amount of time using the Applicant's most current contact information provided to the Commission.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on June 22, 2026.

TRD-202602549

Stephanie Whallon

Director, Texas Film Commission

Texas Film Commission

Effective date: July 12, 2026

Proposal publication date: February 13, 2026

For further information, please call: (512) 463-9200

13 TAC §121.13

The Office of the Governor ("OOG") adopts the repeal of 13 TAC §121.13, concerning Texas Heritage Project. The repeal is adopted without changes to the proposed text as published in the February 13, 2026 issue of the Texas Register (51 TexReg 805) and will not be republished. The OOG identified the necessity of the adopted repeal while reviewing the rule in response to the passage of Senate Bill 22 (89-R), which significantly modified provisions of the Texas Moving Image Industry Incentive Program ("TMIIIP") statutes.

REASONED JUSTIFICATION

TMIIIP was implemented to increase employment opportunities for Texas industry professionals, encourage tourism to the state, and boost economic activity in Texas cities and the overall Texas economy. The 89th Legislature passed Senate Bill 22, which among other actions, significantly modified the Texas Heritage Grant. In a future rulemaking, the OOG will propose a new rule regarding the Texas Heritage Grant, as well as another incentive created by Senate Bill 22, the Texas Faith-Based Moving Image Project grant.

SUMMARY OF COMMENTS AND RESPONSES:

The public comment period on the proposal began February 13, 2026, and ended at 5:00 p.m. on March 15, 2026. No public comments were received.

STATUTORY AUTHORITY.

The repeal is adopted under Section 485.022 of the Texas Government Code, which requires the Texas Film Commission to develop procedures for the administration and calculation of grant awards under TMIIIP. The repeal is also adopted in accordance with Senate Bill 22, which took effect on September 1, 2025.

CROSS REFERENCE TO STATUTE

No other statutes, articles, or codes are affected by the adopted repeal.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on June 22, 2026.

TRD-202602550

Stephanie Whallon

Director, Texas Film Commission

Texas Film Commission

Effective date: July 12, 2026

Proposal publication date: February 13, 2026

For further information, please call: (512) 463-9200