TITLE 13. CULTURAL RESOURCES

PART 8. TEXAS FILM COMMISSION

CHAPTER 122. TEMPORARY USE OF STATE BUILDINGS AND GROUNDS BY TELEVISION OR FILM PRODUCTION COMPANIES

The Office of the Governor ("OOG") proposes amendments to 13 TAC §122.1, concerning Background and Purpose; §122.2, concerning Definitions; §122.3, concerning Eligibility; §122.4, concerning Ineligibility; §122.5, concerning Application Process; §122.6, concerning Approval Process; §122.7, concerning Applicant's Responsibilities; §122.8, concerning Process During Production Activity; §122.9, concerning Seven Days of Location Fee Waivers; §122.10, concerning Rights of the Location and the Texas Film Commission; and §122.11, concerning Disqualifications. The proposed amendments are being made as a result of the OOG's review of Chapter 122 under Texas Government Code §2001.039. The proposed amendments will update terminology, improve readability and clarity, align the chapter with current agency practice, and better conform the rules to Texas Government Code §2165.008.

EXPLANATION OF PROPOSED AMENDMENTS

Chapter 122 implements Texas Government Code §2165.008, which governs the temporary use of state buildings and grounds by television or film production companies. As part of the rule review conducted under Texas Government Code §2001.039, the OOG has determined that the reasons for initially adopting Chapter 122 continue to exist, but that amendments are appropriate to update the rules, improve clarity, remove outdated language, and better reflect current procedures used by the Texas Film Commission and state agencies when considering requests for production activity on state property.

The proposed amendments to §122.1 revise the background and purpose section to clarify the statutory basis for the chapter, update the description of the chapter's purpose, and remove obsolete or unnecessary historical language.

The proposed amendments to §122.2 revise the definitions section to update terminology, remove obsolete or duplicative language, conform defined terms to the terms used in the chapter, and improve clarity and consistency.

The proposed amendments to §122.3 revise the eligibility requirements for conducting production activity on state property and for receiving a waiver of location fees. The amendments clarify certificate of insurance requirements, reimbursement obligations for costs incurred, and project eligibility requirements.

The proposed amendments to §122.4 consolidate and clarify the ineligibility provisions, including ineligibility based on failure to meet the eligibility requirements in §122.3 or based on project content that is obscene as defined by Texas Penal Code §43.21.

The proposed amendments to §122.5 update the application process, including revisions to the manner in which an applicant may obtain and submit a Request for Use Application, the timing for submitting an application, and the materials required to support an application. The amendments also add requirements relating to submission of a content document.

The proposed amendments to §122.6 revise the approval process to clarify Commission review of applications, communication with applicants, coordination with the state agency or entity having charge and control of the property, approval by both the Commission and the agency or entity, potential denial of an application, and execution of a location agreement before production activity occurs.

The proposed amendments to §122.7 revise provisions relating to applicant responsibilities, including payment of applicable location fees, security deposits, reimbursement of costs incurred, licensing fees, and conduct while on state property. The amendments also clarify notice and payment procedures for costs incurred.

The proposed amendments to §122.8 clarify supervision of production activity, including the ability of the Commission and the applicable agency to determine the appropriate level of on-site supervision and any specific conditions necessary for the production activity. The amendments also clarify the Commission's ability to be present on location and request documentation to verify compliance with the approved application and location agreement.

The proposed amendments to §122.9 clarify the process for allowing up to seven days of location fee waivers for each state property during a state fiscal year, clarify that the Commission may determine the allocation of those days, and clarify that the waiver does not apply to support locations, security deposits, costs incurred, licensing fees, or other fees or charges.

The proposed amendments to §122.10 clarify the rights of the applicable state agency and the Commission to decline a proposed use of state property, modify or deviate from procedural steps by mutual agreement, coordinate communications between the applicant and the agency, or withdraw from participation in arrangements for use of state property consistent with Texas Government Code §2165.008 and this chapter.

The proposed amendments to §122.11 revise the disqualification provisions for clarity and consistency with the rest of the chapter, including provisions relating to required documentation, false or misleading information, payment obligations, obscene content, ineligible projects, and failure to comply with applicable conduct requirements or instructions issued by the Commission or the agency during production activity.

FISCAL NOTE

Stephanie Whallon, Director, Texas Film Commission, has determined that during each of the first five years in which the proposed amendments are in effect, there will be no foreseeable fiscal implications for state or local governments as a result of enforcing or administering the proposed amendments.

PUBLIC BENEFIT AND COSTS

Ms. Whallon has also determined that during each of the first five years in which the proposed amendments are in effect, the rule changes will yield the anticipated public benefit of clearer, more current, and more administrable rules governing the temporary use of state buildings and grounds by television or film production companies. The proposed amendments will improve transparency for production companies, state agencies, and the public by clarifying application, approval, supervision, fee, reimbursement, and disqualification procedures.

Ms. Whallon has determined that there are no measurable anticipated economic costs to persons required to comply with the proposed amendments.

There will be no adverse economic effect on small businesses, micro-businesses, or rural communities. Since the OOG has determined that the proposed amendments will have no adverse economic effect on small businesses, micro-businesses, or rural communities, preparation of an Economic Impact Statement and a Regulatory Flexibility Analysis, as detailed under Texas Government Code §2006.002, is not required.

LOCAL EMPLOYMENT IMPACT STATEMENT

Ms. Whallon has determined that the proposed amendments will not affect a local economy. Therefore, a local employment impact statement is not required under Texas Government Code §2001.022.

GOVERNMENT GROWTH IMPACT STATEMENT

Ms. Whallon has determined that during each of the first five years in which the proposed amendments are in effect, the amendments:

(1) will not create or eliminate a government program;

(2) will not require the creation of new employee positions or the elimination of existing employee positions;

(3) will not require an increase or decrease in future legislative appropriations to the OOG;

(4) will not require an increase or decrease in fees paid to the OOG;

(5) do not create a new regulation;

(6) will expand, limit, or repeal existing regulations only to the extent the amendments clarify, update, and reorganize existing requirements governing the temporary use of state property for production activity;

(7) will not increase or decrease the number of individuals subject to the applicability of the rules; and

(8) will not positively or adversely affect the Texas economy.

TAKINGS IMPACT ASSESSMENT

The OOG has determined that no private real property interests are affected by the proposed amendments, and the proposed amendments do not restrict, limit, or impose a burden on an owner's rights to the owner's private real property that would otherwise exist in the absence of government action. As a result, the proposed amendments do not constitute a taking or require a takings impact assessment under Government Code §2007.043.

SUBMISSION OF COMMENTS

Written comments regarding the proposed rule amendments may be submitted for 30 days following the date of publication of this notice by mail to Stephanie Whallon, Office of the Governor, Texas Film Commission, P.O. Box 12428, Austin, Texas 78711, or by email to tfcrules.comments@gov.texas.gov with the subject line "Chapter 122 Proposed Rules." The deadline for receipt of comments is 5:00 p.m., Central Time, on October 26, 2026.

STATUTORY AUTHORITY

The amendments are proposed under Texas Government Code §2165.008, which authorizes and governs the temporary use of state buildings and grounds by television or film production companies and requires approval by the Texas Film Commission and the state agency or other state governmental entity having charge and control of the property.

The amendments are also proposed as a result of the OOG's review of Chapter 122 under Texas Government Code §2001.039.

CROSS REFERENCE TO STATUTE

Texas Government Code §2165.008. No other statutes, articles, or codes are affected by the proposed amendments.

§122.1. Background and Purpose.

(a) Background. This chapter implements section 2165.008 of the Texas Government Code, relating to the temporary use of state property by television or film production companies. [House Bill 374 establishes the rules and processes for the temporary use of state properties by a production company for production activity. It also establishes that a state property can be used seven days during a fiscal year without charge, other than the reimbursement of additional costs. This Act takes effect September 1, 2007.]

(b) Purpose.

(2) [(1)] Texas has had a prodigious film industry for decades, and has always been popular with filmmakers worldwide for its varied and beautiful locations. It has been the Texas Film Commission's (Commission) [(TFC)] responsibility since 1971 to help filmmakers find the right Texas location, and state properties are a location asset the Commission can promote [have always been popular choices]. Establishing rules and processes for filming at these locations will allow for a smooth process and make it easier for filmmakers to utilize state property [use their] preferred locations, as well as take the burden of communicating with and supervising production companies off the state property.

(3) [(2)] The Texas Film Commission is also responsible for attracting production activity to Texas because of its positive impact on the State's economy and workforce. The use of state properties for free for seven days of each fiscal year will be another tool that the Commission [TFC] can use to attract filmmakers to Texas, increasing our competitive edge.

§122.2. Definitions.

The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise:

(4) [(3)] Certificate of Insurance [liability insurance]--A document issued by an insurer that provides proof of insurance coverage meeting the requirements established by the Commission, and that names the State of Texas as an additionally insured. [The paper record showing that the Production Company has purchased insurance, the amount insured for, and who is insured under the policy.] Each Certificate of liability insurance furnished by a Production Company pursuant to this chapter shall reflect the coverage amounts required by the desired location, but such coverage amounts shall in no event be lower than the following (unless waived in writing by the Texas Film Commission in any particular respect): $1 million in Commercial General Liability, including bodily injury and property damage with $1 million of umbrella coverage, $1 million Automobile Liability including bodily injury and property damage, plus Workers' Compensation coverage in accordance with statutory limits and employers' liability with limits of $100,000 bodily injury for each accident, $100,000 bodily injury by disease and $500,000 policy limit covering all personnel who provide services. In the event that the Production Company is self-insured for Workers' Compensation coverage, it can provide written documentation of this fact on its letterhead, signed by an officer. Each policy must include a waiver of subrogation, unless waived in writing by the Texas Film Commission.

(5) [(4)] Commercials--Either an individual commercial, series of commercials, music video, infomercial, interstitial, or still shoot, that is made for the purpose of promoting a product, service, or idea.

(8) [(7)] Feature Film--Either a narrative or documentary project intended for distribution in theaters or by DVD, internet, or mobile electronic device.

(9) [(8)] Filming days--The phase of the project during which the content is recorded.

(10) [(9)] Fiscal year--The period between September 1st and August 31st of the next calendar year.

(11) [(10)] In-state spending--The amount of money spent by a production company in Texas during all stages of the project.

(12) [(11)] Licensing Fee--An amount charged to the Applicant for the use of the state property's likeness and image.

(13) [(12)] Location--A building or ground where production activity will take place.

(14) [(13)] Location fee--An amount charged to the Applicant for each day production activity occurs at the location [on the property.]

(15) [(14)] Production activity--Any activity the production company engages in while on location, including, but not limited to, preparation, filming, parking, catering, and take down.

(16) [(15)] Production company--The entity producing and creating the project, who is ultimately responsible for all production activity.

(17) Request for Use Application--The application that will be completed by the Applicant to ask for the use of a state property for production activity.

(18) Security deposit--A monetary amount given to the state property before commencement of production activity at that location which gives the state agency some protection for damage done to the location by the production company [Production Company].

(19) State property--All locations owned and operated by the State of Texas for public or private use.

(20) Support location--An area of the property that is being used for production activity other than filming that can either be part of the filming location or a stand-alone location.

(21) Television Program [project]--Either a narrative or documentary project, including, but not limited to episodic series, miniseries, television movie (MOW), television pilot, or television episode, that is intended for distribution via broadcast or digital distribution via cable, satellite, the internet, or mobile electronic device.

§122.3. Eligibility.

(a) To [In order for a production company to] be eligible to conduct production activity on a state property, an applicant [they] must: [meet the following requirements.]

(1) provide a certificate of [must have production] insurance in the amount required by the Commission [the desired location] that names the State of Texas as an additionally insured, consistent with section 2165.008(c)(2) of the Act; [and]

(3) [(2) must] be a film, television, or commercial project for educational, industrial, or commercial purposes.

(b) A production company that meets the requirement of subsection (a) of this section may also be eligible for a waiver of location fees under section 2165.008(e) of the Act if it demonstrates one of the following: [to receive some or all of their filming days free from location fees if they meet the following minimum requirements]

(1) a minimum in-state spending of $250,000 for film or television projects; or [must have production insurance in the amount required by the desired location that names the State of Texas as an additionally insured; and]

(2) [must have a minimum in-state spending of $250,000 for film or television projects, or] a minimum in-state spending of $100,000 for commercials.

§122.4. Ineligibility.

§122.5. Application Process.

(a) Once a production company has decided to use a state property for production activity, the company [they] must complete a Request for Use Application. The application [Application] can be found at the [Texas Film] Commission web [Web] site [http://www.governor.state.tx.us/divisions/film], or by contacting the [Texas Film] Commission if electronic [internet] access is unavailable [not available] or special assistance [needs facilitation] is required.

(b) Applications must be received before the commencement of production activity at the [desired] location[,] and must include the following:

(1) a completed Request for Use Application; [and]

(2) a certificate of [liability] insurance in the amount required by the Commission [desired location] that names the State as an additionally insured; and[.]

(c) An applicant [Applicant] must submit a separate [fill out an] application for each state property proposed for [they wish to] use.

§122.6. Approval Process.

(a) Applications [All applications] will be reviewed in the order they are received by the [Texas Film] Commission.

(b) Upon receipt of an [Once a production company submits an] application, the [Texas Film] Commission will provide electronic notice to [email] the applicant [Applicant] confirming receipt [notifying them that their application has been received].

(c) The [Texas Film] Commission [staff] will [then] review the application and supporting materials to determine whether [if] the production company meets the eligibility [minimum] qualifications of this chapter[,] and whether [that all] the information provided is complete [clear] and reasonable. The Commission [Staff] will contact the applicant [Applicant] to verify [that all] the information provided [on the application is correct]. At that time, applicants may [Applicants will have the ability to] amend their application. The [Texas Film] Commission will determine whether an amendment requires the applicant [Applicant's amendment(s) may require them] to reapply[, and/]or submit [whether] additional documentation [from the Production Company is required for the approval process].

(d) After review, the [The Texas Film] Commission [Staff] will notify in writing the [state] agency of [governing] the applicant’s request. [Applicant’s desired location in writing of the request of use once the application has been reviewed.] The [state] agency and the [Texas Film] Commission will jointly determine whether [if] the request is feasible based on location availability, description of production activity, and location's capabilities.

(e) Both the Commission and the agency must approve the application before production activity may occur, in accordance with section 2165.008(b) of the Act. [The Texas Film Commission Staff will notify the Applicant in writing of whether or not their request has been approved once the application has been approved by all necessary parties.]

(g) [(f)] Upon approval by all necessary parties, the Commission will notify the applicant in writing of the approval. Following approval [Once the Applicant has been approved], a location agreement must [contract will] be executed between the applicant [Applicant] and the State of Texas, acting through the Commission and the agency, for use of the property.

§122.7. Applicant's Responsibilities.

(a) The applicant must pay all required [Applicant is responsible for paying] location fees.

(1) The [Texas Film] Commission, in coordination [conjunction] with the [Applicant's desired location and the state] agency [governing that property], will determine the location fee [to be charged] for each day of [that] production activity [will occur on the property] based on the length of use, loss of business, and impact on the property. The location fee will be stated in the location agreement [contract] between the applicant [Applicant] and the State of Texas [state property,] and is non-negotiable [after that point].

(2) The applicant must [Applicant shall] deposit all required [the] location fees to the credit of the State of Texas, Comptroller of Public Accounts, [and is expected to do so] on or before the first day of production activity. Failure to comply with this subsection [follow these rules] may result in [the] immediate disqualification [of the Applicant] or other appropriate administrative action [similar consequences].

(b) An applicant [Applicant] may be required to pay a security deposit to the [state] agency [governing the desired location] in an [the] amount determined jointly by the [Texas Film] Commission and the agency. Failure to comply with this requirement [follow these rules] may result in [the] immediate disqualification [of the Applicant] or other appropriate administrative action [similar consequences].

(c) The applicant [Applicant] is responsible for reimbursing the agency for all [paying any] actual costs incurred as a result of production activity, as provided in section 2165.008(f) of the Act.

(1) Reimbursable [An Applicant is required to reimburse the state property for actual costs incurred during the use of the location. These] costs include, but are not limited to, necessary personnel repairs to the property from damage, trash removal, and excessive electricity and water use.

(2) The state agency will [shall] notify the applicant [Applicant] in writing of any actual costs incurred that require [the Applicant is responsible for] reimbursement [reimbursing]. The applicant [Applicant] must submit payment [reimburse the cost] no later than the 21st day after the date [on which] the written notification is received.

(d) The applicant [Applicant] may be required to pay a licensing fee to the [state] agency [governing the desired location] in an [the] amount determined jointly by the [Texas Film] Commission and the agency. Failure to comply with this requirement [follow these rules] may result in [the] immediate disqualification [of the Applicant] or other appropriate administrative action. [similar consequences.]

(e) The applicant [Applicant], production company, [Production Company] and all personnel engaged in production activity must [its employees are required to] maintain a code of conduct while on state property [any time they are on location] that includes, but is not limited to, the following:

(1) no smoking;

(2) no alcohol;

(3) no illegal drugs;

(4) no soliciting;

(5) adherence to any [following] location-specific dress code; and

(6) any other [code of] conduct rules required by the agency or location [specific location].

§122.8. Process During Production Activity.

(a) The [Texas Film] Commission and the agency will supervise all production activity conducted on state property by a production company.[, and]

(b) The Commission and the agency will determine, on a case-by-case [case by case] basis, the level of on-site supervision [supervisory] and any specific conditions necessary [needed] for the production [particular] activity.

(c) The [Texas Film] Commission may be present [reserves the right to be] on location during production activity to verify compliance with the approved application and location agreement[,] and may [to] request additional documentation from the production company as necessary to ensure [determine] that [they used the] state property is used as [in the manner] agreed [upon].

§122.9. Seven Days of Location Fee Waivers.

(a) The [Texas Film] Commission may allow each state property to be used without a location fee charge for up to seven days during each state fiscal year and [year, and] may determine the allocation of those days. The location fee waiver applies only to [can only be used for] filming days[,] and does not apply to [cannot count for] areas of [the] state property used solely as [a] support locations [location].

(b) The waiver does not apply to any other fees or charges including, but not limited to, security deposits, [and] actual costs incurred, or licensing fees.

(c) Projects that are eligible to receive location fee waivers are identified [listed] in §122.3 of this title (relating to Eligibility).

§122.10. Rights of the Location and the [Texas Film] Commission.

(a) An agency may [All state properties and the agencies that govern those properties have the right to] decline to permit production activity on its [their] property if the proposed [for reasons including, but not limited too, that the] use would [will] significantly interfere with the conduct of state business or for any other reason authorized by section 2165.008(c) of the Act. An [A state] agency and the Commission may, by mutual agreement, modify or [can decide to] deviate from the procedural steps [processes listed] in this chapter when necessary to address operational needs or unique circumstances. [after an initial application has been sent to the Texas Film Commission if it is determined to be the best course of action by both the Texas Film Commission and the agency.] An [A property and/or a state] agency may [can] also designate [elect for] the [Texas Film] Commission to act as a [the] liaison for coordination and communication between the applicant and the agency [the location].

(b) The [Texas Film] Commission may withdraw from participation in [reserves the right to take themselves out of the contract and] negotiations or contract arrangements for use of [a] state property if [it is determined that] the request does not conform to [fit within the parameters of the rules set forth in] this chapter or at the request of [if it is desired by] the [state] agency. The [Texas Film] Commission may also [reserves the right to] decline a request for [of] use for any reason.

§122.11. Disqualifications.

A production company [Production Company] may be prohibited from conducting production activity on a state property at any time for any of the following reasons:[.]

(1) failure [Failure] to submit required or additional documentation [documents];

(2) submission [Submission] of false or misleading information;

(3) failure [Failure] to pay location fees, costs incurred, or any security deposit on time;

(4) use of state [Using the] property to produce obscene content [for pornographic scenes], as defined by section 43.21 of the Texas Penal Code [§43.21];

(5) submission of an ineligible [Ineligibile] project, as described [listed] in §122.4 of this title (relating to Ineligibility); or [and]

(6) failure to comply with the [Not following] location's code of conduct or with any instruction issued by the Commission or the agency during production activity.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on September 14, 2026.

TRD-202603977

Stephanie Whallon

Director

Texas Film Commission

Earliest possible date of adoption: October 25, 2026

For further information, please call: (512) 463-2000

CHAPTER 123. MEDIA PRODUCTION DEVELOPMENT ZONES

The Office of the Governor ("OOG") proposes amendments to 13 TAC §123.1, concerning Short Title, Background, and Purpose; §123.2, concerning Definitions; §123.3, concerning Request for MPDZ Exemption; §123.4, concerning Request Review by Nominating Body; §123.5, concerning Application for MPDZ Exemption; §123.6, concerning Application Review; §123.7, concerning Economic Impact Analysis; §123.8, concerning Information Requested by Texas Film Commission; §123.9, concerning Media Production Advisory Committee; and §123.10, concerning Miscellaneous Provisions. The proposed amendments are being made as a result of the OOG's review of Chapter 123 under Texas Government Code §2001.039. The proposed amendments will update terminology, improve readability and clarity, align the chapter with current agency practice, and better conform the rules to Texas Government Code Chapter 485A and Texas Tax Code §151.3415.

EXPLANATION OF PROPOSED AMENDMENTS

Chapter 123 implements Texas Government Code Chapter 485A, concerning Media Production Development Zones. Chapter 485A establishes procedures for recognition of media production development zones, designation of qualified media production locations, certification of qualified persons, and related review by the Texas Film Commission, the Comptroller of Public Accounts, nominating bodies, and the Media Production Advisory Committee. As part of the rule review conducted under Texas Government Code §2001.039, the OOG has determined that the reasons for initially adopting Chapter 123 continue to exist, but that amendments are appropriate to update the rules, improve clarity, remove outdated language, and better reflect current procedures used in administering the Media Production Development Zone program.

The proposed amendments to §123.1 revise the short title, background, and purpose section to clarify the statutory basis for the chapter, update the description of the program, and remove obsolete or unnecessary language.

The proposed amendments to §123.2 revise the definitions section to update terminology, conform defined terms to Texas Government Code Chapter 485A, add or revise definitions used in the chapter, and improve clarity and consistency.

The proposed amendments to §123.3 update the process for a request for an MPDZ exemption, including the required contents of a request, the manner in which required forms may be obtained, the supporting documents that must be submitted, the format for submission, and the ability of the Nominating Body, the Commission, or the Comptroller to request additional information.

The proposed amendments to §123.4 revise the process for review of a request by a Nominating Body, including notice to the Requestor and the Commission, criteria to be considered by the Nominating Body, action on a request, submission of an application to the Commission, extension of review time for good cause, and recognition of a media production development zone.

The proposed amendments to §123.5 update the application process for an MPDZ exemption, including the contents of a completed application, the manner in which the application form may be obtained, the format for submission, and the ability of the Commission or Comptroller to request additional information.

The proposed amendments to §123.6 revise the Commission's application-review process, including review for completeness, review of whether the nominated location qualifies for designation, review of whether the nominated location is in a media production development zone, return of incomplete applications, referral of materials to the Comptroller, Comptroller certification regarding positive state revenue impact, review by the Media Production Advisory Committee, approval of applications, certification of qualified persons, designation of qualified media production locations, approval of media production development zones, and denial notices.

The proposed amendments to §123.7 revise the economic impact analysis requirements to align the analysis with the requirements of Texas Government Code §485A.106(b)(5) and the format required by the Comptroller.

The proposed amendments to §123.8 revise provisions relating to information requested by the Commission from a Qualified Person, Nominating Body, appraisal district, or other relevant source to fulfill the Commission's statutory obligations under Texas Government Code Chapter 485A.

The proposed amendments to §123.9 revise provisions relating to the Media Production Advisory Committee, including the committee's purpose, tasks, reporting requirements, and independence requirements. The amendments clarify the committee's role in reviewing applications and making recommendations to the Commission.

The proposed amendments to §123.10 revise miscellaneous provisions relating to Commission discretion, finality of Commission decisions within the agency, notice regarding potentially unauthorized tax exemptions, and the handling of public information requests involving a Requestor or application.

FISCAL NOTE

Stephanie Whallon, Director, Texas Film Commission, has determined that during each of the first five years in which the proposed amendments are in effect, there will be no foreseeable fiscal implications for state or local governments as a result of enforcing or administering the proposed amendments.

PUBLIC BENEFIT AND COSTS

Ms. Whallon has also determined that during each of the first five years in which the proposed amendments are in effect, the rule changes will yield the anticipated public benefit of clearer, more current, and more administrable rules governing Media Production Development Zones. The proposed amendments will improve transparency for Requestors, Nominating Bodies, state agencies, and the public by clarifying request, application, review, certification, designation, reporting, and public-information procedures.

Ms. Whallon has determined that there are no measurable anticipated economic costs to persons required to comply with the proposed amendments.

There will be no adverse economic effect on small businesses, micro-businesses, or rural communities. Since the OOG has determined that the proposed amendments will have no adverse economic effect on small businesses, micro-businesses, or rural communities, preparation of an Economic Impact Statement and a Regulatory Flexibility Analysis, as detailed under Texas Government Code §2006.002, is not required.

LOCAL EMPLOYMENT IMPACT STATEMENT

Ms. Whallon has determined that the proposed amendments will not affect a local economy. Therefore, a local employment impact statement is not required under Texas Government Code §2001.022.

GOVERNMENT GROWTH IMPACT STATEMENT

Ms. Whallon has determined that during each of the first five years in which the proposed amendments are in effect, the amendments:

(1) will not create or eliminate a government program;

(2) will not require the creation of new employee positions or the elimination of existing employee positions;

(3) will not require an increase or decrease in future legislative appropriations to the OOG;

(4) will not require an increase or decrease in fees paid to the OOG;

(5) do not create a new regulation;

(6) will expand, limit, or repeal existing regulations only to the extent the amendments clarify, update, and reorganize existing requirements governing Media Production Development Zones;

(7) will not increase or decrease the number of individuals subject to the applicability of the rules; and

(8) will not positively or adversely affect the Texas economy.

TAKINGS IMPACT ASSESSMENT

The OOG has determined that no private real property interests are affected by the proposed amendments, and the proposed amendments do not restrict, limit, or impose a burden on an owner's rights to the owner's private real property that would otherwise exist in the absence of government action. As a result, the proposed amendments do not constitute a taking or require a takings impact assessment under Government Code §2007.043.

SUBMISSION OF COMMENTS

Written comments regarding the proposed rule amendments may be submitted for 30 days following the date of publication of this notice by mail to Stephanie Whallon, Office of the Governor, Texas Film Commission, P.O. Box 12428, Austin, Texas 78711, or by email to tfcrules.comments@gov.texas.gov with the subject line "Chapter 123 Proposed Rules." The deadline for receipt of comments is 5:00 p.m., Central Time, on October 26, 2026.

STATUTORY AUTHORITY

The amendments are proposed under Texas Government Code §485A.052, which requires the OOG to adopt rules necessary to implement Texas Government Code Chapter 485A, concerning Media Production Development Zones.

The amendments are also proposed as a result of the OOG's review of Chapter 123 under Texas Government Code §2001.039.

CROSS REFERENCE TO STATUTE

Texas Government Code Chapter 485A and Texas Tax Code §151.3415. No other statutes, articles, or codes are affected by the proposed amendments.

§123.1. Short Title, Background, and Purpose.

(a) Short title. The program implemented [contemplated] by this chapter may be referred to as the Production Facilities Incentive.

(b) Background. Chapter 485A of the Texas Government Code establishes the [The] Texas Media Production Development Zone Act which offers exemptions to the Limited Sales, Excise, and Use Taxes to Qualified Persons [qualified persons] who build, construct, renovate, improve, or expand a media production facility within the state.

(c) Purpose. The Texas Media Production Development Zone Act was enacted to maintain and strengthen the media production industry in Texas in the face of strong competition from other states. Soundstages and other production facilities are [would be key] assets in this effort.

§123.2. Definitions.

The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise. [Words defined in Texas Government Code, Chapter 485A, and not defined in this chapter shall have the meanings provided by Texas Government Code, Chapter 485A.]

(1) Act--The Media Production Development Zone Act[,Texas Government Code], Chapter 485A of the Texas Government Code[.]

(2) (No change.)

(4) [(3)] Media Production Development Zone (MPDZ) Exemption--The sales and use tax exemption authorized by section 151.3415 of the [The exemption of certain property from sales, excise, and use taxes pursuant to the Act and] Texas Tax Code and administered under the Act.[, §151.3415.]

(5) [(4)] Metropolitan Statistical Area--An area of the state described on the State Metropolitan Statistical Area Reference Table, as maintained by the Texas Demographic Center or its successor [State Data Center, University of Texas at San Antonio].

(6) [(5)] Nominating Body--Has the meaning assigned by section 485A.002(4) of the Act [The governing body of a municipality or county, as defined in the Act.]

(7) [(6)] Requestor--The title holder of real property, or the leaseholder in a written, non-residential, real property lease with at least four years remaining in the current lease term, on or in which a media production location is proposed.

(8) [(7)] Region--For the purposes of section [§]485A.103(d) of the Act, a grouping of counties based [described] on the Comptroller Economic Region table[, as maintained by the Texas State Data Center, University of Texas at San Antonio].

§123.3. Request for MPDZ Exemption.

(a) A Requestor who seeks an [desires a] MPDZ Exemption shall submit a written request to the Nominating Body having jurisdiction over the proposed media production location.

(b) A [completed] request for an MPDZ Exemption must [shall] include:

(1) a current Request for Exemption form obtained from the Commission [Texas Film Commission (TFC)] via telephone, internet, or other means if additional special needs facilitation is required [website], filled out completely and signed by an authorized representative of the Requestor;

(2) - (6) (No change.)

(7) an economic impact analysis, in the form specified in §123.7 of this chapter;

(8) [a] financial statements [statement] and background information on the Requestor;

(9) such other written documents on which the Requestor relies to qualify for and obtain an [a] MPDZ Exemption; and

(10) such other written documents containing information reasonably requested by the Nominating Body, the Commission [TFC], or the Comptroller, to be provided within a reasonable time not to exceed 20 days from request, unless extended for good cause [which shall be provided within 20 days of the date of the request. The TFC may, for good cause, allow additional time to comply with a request].

(c) The request contents shall be provided in at least one electronic copy that is a searchable portable document format (PDF). [the following formats:]

(d) (No change.)

§123.4. Request Review by Nominating Body.

(a) Within 7 days of receipt of a request for MPDZ Exemption, the Nominating Body shall deliver to the Commission the electronic [Texas Film Commission (TFC) a digitized] copy of the request in searchable portable document format (PDF).

(b) If the Nominating Body determines that the Requestor has submitted a complete request and, by official action, decides to consider that request, then the Nominating Body shall provide written notice to the Requestor and [to] the Commission [TFC] that includes:

(1) - (2) (No change.)

(c) In reviewing a request, the Nominating Body shall consider:

(1) whether the proposed media production location meets the requirements of the Act, including section 485A.102;

(2) whether the Requestor has the ability and financial wherewithal to successfully complete the building, constructing, renovating, or expanding of the proposed media production facility within 18 months from certification as a Qualified Person [qualified person] under §123.6(g)(1) [§123.6(f)(1)] of this chapter; and

(3) whether the proposed financial incentives are in the best interest of the Nominating Body [and this state].

(d) Subject to subsection (f) of this section, within [Within] 90 days after [of] deciding to consider a completed request, the Nominating Body shall [either]:

(3) [(1)] adopt a written ordinance or order nominating the proposed media production location which shall include:

(A) written findings as to each criterion listed in section [§]485A.102 of the Act;

(B) the [written] information [as] listed in section [§]485A.105 of the Act; and

(C) a determination that granting the MPDZ Exemption to the Requestor is in the best interest of the Nominating Body. [and this state; and]

(f) [(e)] If, for good cause and before the 90th day after deciding to consider a completed request, a [A] Nominating Body determines it needs additional time to consider a request under subsection (d) of this section, the Nominating Body shall, by [may, for good cause and upon] written notice, notify [to] the Requestor and the Commission of such necessity. The Nominating Body shall work with the Commission to determine the date by which the final determination must be made. The Nominating Body shall provide in the notice the date by which the Nominating Body shall make its final determination on the request. [with a copy to the TFC, take more than 90 days to consider a request under subsection (d) of this section.]

(g) [(f)] The Commission shall not consider a media production location nominated under this section unless the media production location is located in a media production development zone. If the area in which the nominated location is situated has not previously been recognized as a [, the Nominating Body at the same time shall also adopt a written ordinance or order recognizing the] media production development zone, the Nominating Body shall, at the same time that it adopts the nominating ordinance or order under subsection (d)(3) of this section, adopt a separate ordinance or order recognizing the zone [in which a location nominated under subsection (d)(1) of this section is located]. This ordinance or order must [shall] include:

(1) (No change.)

(2) written findings as to each criterion listed in section [§]485A.101 of the Act; and

(3) (No change.)

§123.5. Application for MPDZ Exemption.

(a) A Nominating Body that has recognized a zone, nominated a location, and certified a Qualified Person [person] for the purposes of an [a] MPDZ Exemption shall submit a written application to the Commission [Texas Film Commission (TFC)].

(b) A completed application must [shall] include:

(1) the current Application for Designation [Exemption] form obtained from the Commission [TFC website], filled out completely and signed by an authorized representative of the Nominating Body, with all specified attachments; and

(2) such other written documents containing information reasonably requested by the Commission [TFC] or the Comptroller to be provided within a reasonable time not to exceed 20 days from request, unless extended for good cause. [which shall be provided within 20 days of the date of the request. The TFC or Comptroller may, for good cause, allow additional time to comply with a request.]

(c) The application contents shall be provided in at least one electronic copy that is a searchable portable document format (PDF). [in the following formats:]

(d) The application shall be submitted in any manner acceptable to the Commission [TFC].

§123.6. Application Review.

(a) Upon receipt of an Application for MPDZ Exemption from a Nominating Body, the Commission [Texas Film Commission (TFC)] shall review the application to determine:

(1) whether the application is complete with respect to section [in accordance with §]485A.106 of the Act and [with the provisions of] this chapter;

(2) [(3)] whether the nominated location is in a media production development zone and, if not [previously reviewed], whether the recognized zone qualifies for approval as a media production development zone, and[.]

(b) The Commission [TFC] shall provide to the Nominating Body written notice that [either]:

(1) the application is complete and the Commission is considering it [and is being considered]; or

(2) the application is incomplete and the Commission is returning it [is being returned] to the Nominating Body [for remediation].

(d) [(c)] Upon acceptance of an application for consideration, the Commission [TFC] shall deliver to the Comptroller [Comptroller's office]:

(1) an electronic [a digitized] copy of the Requestor's request;

(2) an electronic [a digitized] copy of Nominating Body's application; and

(3) (No change.)

(e) [(d)] Within 30 days of receipt of the items in subsection (d) [(c)] of this section, the Comptroller [Comptroller's office] will [shall] provide in writing to the Commission [TFC] certification as to whether the proposed project will have a positive impact on state revenue. Should the Comptroller [Comptroller's office] request additional information from the Requestor or the Nominating Body, the time it takes a party to provide the additional information will [shall] not count toward the 30 days.

(f) [(e)] Upon receipt of certification of positive state revenue impact from the Comptroller [Comptroller's office], the Commission [TFC] shall, as soon as practicable, call a meeting of the Media Production Advisory Committee to[, as soon as practicable]:

(1) (No change.)

(2) provide a written recommendation to the Commission [TFC] with respect to the pending application.

(g) [(f)] If the Commission [TFC] approves an application, it shall provide to the Requestor, with a copy to the Nominating Body, a letter indicating:

(1) certification of the Requestor as a Qualified Person [qualified person];

(2) approval granting the MPDZ Exemption to the Qualified Person [qualified person]; and

(3) the expiration date for such MPDZ Exemption established in accordance with section 485A.111 of the Act [exemption].

(h) [(g)] If the Commission [TFC] approves an application, it shall, as needed, simultaneously approve the project's recognized zone as a media production development zone, and designate the project's nominated location as a qualified media program location. It shall communicate these actions in writing to the Nominating Body and the Requestor.

(i) [(h)] If the Commission [TFC] denies an application, it shall provide written notification to the Nominating Body and the Requestor.

§123.7. Economic Impact Analysis.

(a) (No change.)

(b) The economic impact analysis shall be conducted in accordance with the requirements of [presented in the format promulgated by] the Comptroller [Comptroller's office] and must satisfy the elements of section 485A.106(b)(5) of the Act. [include:]

§123.8. Information Requested [Reports] by Texas Film Commission.

(a) In order to fulfill its statutory obligation under the Act, the Commission [Texas Film Commission (TFC)] may request information from any Qualified Person [qualified person], Nominating Body, appraisal district, or any other relevant source.

(b) The entities receiving a request from the Commission [TFC] under this section shall provide the information requested in the form and in the manner designated by the Commission [TFC].

§123.9. Media Production Advisory Committee.

(a) Purpose. The [Created pursuant to §485A.107 of the Act, the] Media Production Advisory Committee (MPAC), established under section 485A.107 of the Act, reviews applications submitted to the Commission [Texas Film Commission (TFC)] under the Act and makes recommendations on designation of qualified media production locations. [The advice and recommendations expressed by the MPAC provide the TFC and the Comptroller's office with a broader perspective regarding media production matters that will be considered in determining whether to approve an application.]

(b) Tasks. The MPAC shall:

(1) review each application for designation of qualified media production locations [eligible to be certified under the Act,] and make a recommendation to the Commission [TFC with respect to those applications]; and

(2) perform other duties as determined by the Commission [TFC].

(c) Reporting requirements. The MPAC shall [will] report to the Commission [TFC] by way of consultation at called meetings.[;] No [no] formal reports, other than the MPAC's [committee's] written recommendation with respect to [on] an application, are required unless requested by the director of the Commission [TFC.]

(d) Independence. Each MPAC member shall in fact and in appearance be independent of any media production location, facility, or Qualified Person [qualified person] who has been nominated, recognized, qualified, or certified under the provisions of the Act and this chapter.

(1) An [A] MPAC member lacks independence prima facie if such member, or any member of his or her immediate family, with regard to any media production location, facility, Qualified Person [qualified person], or the Requestor:

(A) - (B) (No change.)

(2) If an MPAC member lacks independence, that member must be recused from any meeting about such location, facility, Qualified Person [qualified person], or the Requestor and may not hear, discuss, deliberate on, or vote on the determination of the recommendation thereon.

§123.10. Miscellaneous Provisions.

(a) Not every application will qualify for an [a] MPDZ Exemption. The Commission retains discretion to approve, deny, or decline to act on an application consistent with the Act and applicable law [Texas Film Commission (TFC) is not required to act on or approve any application]. All decisions by the Commission under this chapter [TFC] are final within the agency and not subject to further administrative review.

(b) If the Comptroller receives written notice from the Nominating Body or the Commission [TFC] that a Qualified Person [qualified person] was not entitled to an [a] MPDZ Exemption or was entitled to a lesser amount than an approved application received, the Comptroller shall investigate that determination and provide a written response to the Nominating Body that concludes either that the approved application may have or may not have received unauthorized tax exemptions. If the Nominating Body and the Comptroller agree that an approved application may not have been entitled to a tax exemption, they shall promptly notify the Qualified Person [qualified person], the appropriate taxing authorities, and the Commission [TFC].

(c) The Commission is a [TFC] division of the Texas Economic Development and Tourism Office in the Office of the Governor and [is] a state agency subject to [and must comply with] the Texas Public Information Act [(PIA)]. If a public information request relating to a Requestor or an application is received, the Office of the Governor will, when current contact information is available, promptly notify the Requestor of the request, take appropriate steps to protect confidential information in consultation with the Office of the Attorney General, and provide the Requestor an opportunity to participate in that process. [In the event that a public information request related to the Requestor and/or an application is submitted to the agency, the Office of the Governor will promptly notify the Requestor of the request if current contact information is available, take all appropriate actions with the Attorney General of Texas to prevent release of confidential information, including asserting exemptions under the PIA, and provide the Requestor with full information and opportunity to participate in such process if current contact information is available.]

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on September 14, 2026.

TRD-202603978

Stephanie Whallon

Director

Texas Film Commission

Earliest possible date of adoption: October 25, 2026

For further information, please call: (512) 463-2000