TITLE 10. COMMUNITY DEVELOPMENT
PART 5. OFFICE OF THE GOVERNOR, ECONOMIC DEVELOPMENT AND TOURISM OFFICE
CHAPTER 176. ENTERPRISE ZONE PROGRAM
10 TAC §§176.1 - 176.5The Office of the Governor ("Office") adopts amendments to 10 TAC §§176.1 - 176.5. Section 176.4 is adopted with a change to the proposed text as published in the May 2, 2025 issue of the Texas Register (50 TexReg 2663). Section 176.4 will be republished.
Sections 176.1, 176.2, 176.3, and 176.5 are adopted without changes to the proposed text as published in the May 2, 2025 issue of the Texas Register (50 TexReg 2663) and will not be republished.
REASONED JUSTIFICATION OF ADOPTED AMENDMENTS
The adopted amendment to rule §176.1 specifically addresses the participation of veterans in the program. The amendments also clarify that a single project may only have one concurrent designation for the same qualified business. The amendments further clarify that the window during which a project may begin making investments and creating jobs for program purposes is ninety business days, as specified in section 2303.003(1-b), Texas Government Code. The amendments also require the submission of applications and other written communications through a manner specified by the office, to include an electronic portal.
The adopted amendment to rule §176.2 removes a requirement that the required ordinance include a statement that the governing body is in full compliance with chapter 2303, Texas Government Code. The requirement is not established in statute and applicants otherwise demonstrate they are in compliance with that chapter in the application process. The amendments also clarify notice and posting requirements. Other changes enhance readability and make conforming redesignations of provisions to account for additions and deletions of regulatory text.
The adopted amendment to rule §176.3 specifically notes the veteran hiring requirements specified in Section 2303.402(a), Texas Government Code, for applicants' ease of reference. Other changes align regulatory text with current statutes and enhance the readability and clarity of the text.
The adopted amendments to rule §176.4 reduce the amount of application materials an applicant must provide, such as removing the requirement the application must be hole-punched and in a three-ring binder. Instead, applications must be submitted using the Office's electronic portal. Other changes align rules with the statutory allowance provided by section 2303.4052(b), Texas Government Code, which allows the submission of digital scans of certified copies of required documents. The amendments also clarify that applicants must include information related to full-time jobs, rather than any type of job. Other non-substantive changes modernize the regulatory text, enhance readability, and promote clarity. Finally, after proposing amendments to this rule in the May 2, 2025, issue of the Texas Register, the Office determined a citation in §176.4(e)(2)(B) text needed to be updated to change the citation from §176.2(2) to §176.2(a)(2).
The adopted amendment to rule §176.5 aligns rule text with statute by noting the Texas Comptroller of Public Accounts will report certain information to the Office on or before the 60th day after the end of the fiscal year, rather than October 1 of each year.
SUMMARY OF COMMENTS AND AGENCY RESPONSE:
The Office received no comments in response to this rulemaking.
TAKINGS IMPACT ASSESSMENT
Ms. Cruz has determined that there are no private real property interests affected by the adopted rules; therefore, the Office is not required to prepare a takings impact assessment pursuant to section 2007.043, Texas Government Code.
STATUTORY AUTHORITY
Section 2303.051(c), Texas Government Code, authorizes the Office to adopt rules necessary to carry out the purposes of chapter 2303, Texas Government Code.
CROSS REFERENCE TO STATUTE
No other statutes, articles, or codes are affected by the adopted rules.
§176.4.
(a) An application must be submitted through the online portal and must contain all information and documentation required under the Act and this chapter, as applicable. Each application for enterprise project designation must be typed directly on the form provided by the Bank.
(b) An application that is submitted with four or more material deficiencies will be declined as incomplete. Material deficiencies are items such as the governing body application certification, the qualified business application certification, or any other required tabbed item.
(c) The applicant shall file with the Bank one original application for designation as an enterprise project. All applications for enterprise project designation must be received by the Office no earlier than one week before, and no later than 11:59 p.m. Central Standard Time, on the first business day of the following months: September, December, March and June. Further, all applications include a non-refundable application fee in the form of a certified check or money order made payable to the Office of the Governor. The application is not considered to be received unless it is received on the online portal with the non-refundable application fee submitted under separate cover to Office of the Governor, Economic Development and Tourism, Texas Economic Development Bank, Attn: Financial Services, Post Office Box 12428, Austin, Texas 78711. The application fee must clearly show the name of the nominating jurisdiction, as well as the name of the qualified business. Both the application and the application fee must be received by the application deadline. Applications received after a deadline will not be accepted, and must be resubmitted to the Bank in the prescribed timeframe to be considered for designation during the next application deadline.
(d) Applications received during a quarterly round will be reviewed and scored by the Bank in accordance with the Act, this chapter and the goals of the program.
(e) The application for designation of an enterprise project must contain the following information and documentation, as applicable:
(1) The participants. The application must contain the name, street address, mailing address, telephone number, and electronic mail address for each of the following involved in the designation of a qualified business as an enterprise project:
(A) the applicant governing body and the applicant governing body's liaison; and
(B) the qualified business, the primary business's representative and the local business liaison. The local business liaison must be located at the qualified business site.
(2) The applicant. The application must contain the following information and documentation concerning the applicant:
(A) a statement signed by the governing body liaison certifying that the contents of the application are true and correct to the best information and belief of the liaison, and that he or she has read the Act and this chapter and is familiar with the provisions thereof;
(B) a certified copy of the nominating ordinance or order under §176.2(a)(2) of this title (relating to Participation in the Program), or if an ordinance or order has already been passed nominating a project for designation, a certified copy of a resolution from the applicant governing body nominating the qualified business for designation as an enterprise project and containing:
(i) nomination of the project or activity as an enterprise project;
(ii) a statement as to whether the project or activity is located in an area designated as an enterprise zone, and, if applicable, that the project is located in an area that is also designated as a defense base development authority established under Chapter 379B, Local Government Code, a federal empowerment zone, a federal enterprise community, or a renewal community;
(iii) reference by number to the nominating ordinance or order indicating participation in the program, with a statement that the local incentives described in the previously issued ordinance or order electing to participate in the enterprise zone program are the same as those made available to the project or activity;
(iv) the active designation period of the project; and
(v) if the project or activity is nominated as a double jumbo enterprise project or a triple jumbo enterprise project, a statement that the designation will count as two or three designations, respectively, against the total number of designations allowed, as applicable.
(C) the block group of the primary business address of the qualified business site, verifiable by the local appraisal district;
(D) the poverty rate for the block group of the primary business address of the qualified business site, or the poverty rate of the distressed county in which the qualified business site is located;
(E) an official census map, which clearly identifies the location of the proposed project and the census area where it is located;
(F) a description of the municipality's or county's procedures and efforts to facilitate and encourage participation by and negotiation between all affected entities in the jurisdiction in which the qualified business is located including a description of the business activity that has occurred in the area within the last year. This description must demonstrate the cooperation among the public and private sectors;
(G) a description of the local effort made by the municipality or county and other affected entities to achieve development and revitalization of the area as described in the Act, §2303.405(c). This includes a brief historical description of the trade and business conducted in the area.
(3) The project. The application must contain the following information and documentation concerning the proposed project:
(A) a statement signed by the primary business representative and the local business liaison certifying that the contents of the application are true and correct to their best information and belief, and that they have read the Act and this chapter and are familiar with the provisions thereof;
(B) a description and introduction of the business applying for the project designation, which includes:
(i) a copy of the articles of incorporation, or the dba statement under which the business operates, filed with the Secretary of State of the State of Texas. The name under which the business is applying for designation must be the same as the business paying state taxes and creating and/or retaining jobs to obtain program benefits;
(ii) the principal owners and history of the business;
(iii) a resolution for corporations or a certificate of authority that provides signatory authority to a person or persons to submit the enterprise project application and sign any contracts or forms on behalf of the business for the enterprise project;
(iv) the number of business locations, total sales, and number of employees in the State of Texas, the United States, and outside the United States;
(v) the federal tax identification number, and/or the Texas Comptroller tax identification number, as applicable, for all participating entities of a controlled group;
(vi) a description of the business' products and services, including NAICS code;
(vii) a description of the business' export history, if applicable; and
(viii) an organizational chart that indicates the business structure, as well as the role of each entity participating in the project;
(C) the plans of the business for expansion, revitalization, and other activity at the qualified business site for the designation period of the project including:
(i) a description of the project location and intended use;
(ii) a summary of short and long-term plans for expansion at the qualified business site;
(iii) the amount of capital investment to be made at the qualified business site during the designation period;
(iv) the status of any required local, state or federal permits or licenses that must be obtained to enable the project to be initiated and completed as represented in the enterprise project application;
(v) a tabular summary of the current number of full-time, part-time jobs which includes the titles and/or Standard Occupational Classification by six-digit code and salary ranges of jobs to be maintained at the qualified business site. Full-time positions will be used for baseline information;
(vi) a tabular summary of the number of new full-time jobs, the titles and/or Standard Occupational Classification by six-digit code and salary ranges of full-time jobs to be created;
(vii) a tabular summary of the number of full-time jobs, the titles and/or Standard Occupational Classification by six-digit code and salary ranges of full-time jobs to be retained, if applying for retained job benefit; and
(viii) the total projected annual payroll for the jobs that are being considered for benefit;
(D) commitments from the business that include:
(i) a completed form provided by the Bank, certifying the business as a qualified business;
(ii) a statement from a franchise or subsidiary, if applicable, stating that the business will maintain separate payroll and tax records of the business activity conducted at the qualified business site;
(iii) the percentage of new or additional employees hired to occupy the jobs being claimed for benefit that are residents of any enterprise zone in the state, that are economically disadvantaged, or that are veterans;
(iv) a description of the efforts of the business to develop and revitalize the area as described in the Act, §2303.405(e); and
(v) a statement certifying that the business, or a branch, division, or department of the business, does not and will not knowingly employ an undocumented worker.
(f) Concurrent enterprise project designations. A qualified business that currently has an enterprise project designation may apply for one additional enterprise project designation at the same qualified business site. To receive the additional enterprise project designation the governing body must complete an enterprise project application with all of the required nominations and attachments. Additionally, the application must include a breakdown of capital investment and new and/or retained jobs for each designation, clearly delineating what capital investment and jobs will apply to which designation, with timelines for all.
(g) Name change. If the name of a qualified business that has received an enterprise project designation has changed, the Bank may approve the name change for the enterprise project designation. The designated enterprise project must apply for a name change to the Bank no later than 18 months after the enterprise project designation expires, or the business will not be eligible for program benefits. The name change of a project designation by a qualified business does not extend the original designation period, which is applicable to the original and subsequent designee, and which will end on the last day of the original designation period. The receive Bank approval for a name change, the qualified business must submit through the applicant governing body:
(1) a completed Name Change Application, along with a non-refundable cashiers check or money order made payable to Office of the Governor, for a processing fee;
(2) a written explanation by the designee of the reasons for the name change, the date the name change occurred and any changes to the commitments made by the business in the original enterprise project application, if applicable; and
(3) written acknowledgment from the applicant governing body that it is aware of the name change for the project as a qualified business operating at the qualified business site within its jurisdiction.
(h) Assignment or Assumption. The Bank may approve the assignment or assumption of a state-designated enterprise project that has transferred through a sale to another entity that will commit to continue operations at the qualified business site in the way originally committed within the initial enterprise project application, or which otherwise demonstrates to the satisfaction of the Bank that the assignment or assumption is warranted to avoid disruption of operations and loss of jobs. The transfer of a project designation by a qualified business does not extend the original designation period, which is applicable to the original and subsequent designee and which will end on the last day of the original designation period. The designated enterprise project must apply to the Bank, through the appropriate governing body, for designation assignment or assumption no later than 18 months after the enterprise project designation expires, or the business will not be eligible for program benefits. The following must be submitted through the applicant governing body to the Bank:
(1) official action by the governing body in the form of a resolution approving the transfer of the enterprise designation to the purchaser;
(2) a completed Enterprise Project Assignment Application, along with a non-refundable cashiers check or money order made payable to Office of the Governor for a processing fee;
(3) a written relinquishment from the designated project's qualified business to the governing body and Bank to release all claim to the project designation and any benefits represented thereunder and agreeing to the assignment of the designation as of a specific date by the purchaser seeking to assume the designation;
(4) a written certification from the purchaser on a form to be provided by the Bank that the purchaser will be a qualified business under the Act, §2303.402;
(5) a letter of commitment from the purchaser addressed to the governing body and the Bank in the same format as the letter of commitment filed in the original application for project designation by the initial qualified business. The letter should outline any modifications proposed by the purchaser to the original commitments made by the qualified business holding the project designation, including capital investment and jobs to be created or retained, as applicable, and a statement as to why the assignment is essential to their operations at the qualified business site;
(6) a Comptroller of Public Accounts tax identification number and federal tax identification number for the purchaser; and
(7) a copy of the purchasers' articles of incorporation filed with the State of Texas Secretary of State, or the dba statement under which the business operates.
(i) A qualified business may be designated as an enterprise project for no less than one year and no longer than five years. The designation of a qualified business as an enterprise project shall remain in effect during the period beginning on the date of the designation and ending on the earliest of:
(1) the date requested in the application for designation as an enterprise project as indicated in the nominating ordinance, order or resolution, as applicable;
(2) five years after the date the designation is made;
(3) the last day that completes the original project designation period of a qualified business that has assumed the designation of the enterprise project designation through or purchase of a designated qualified business for the purpose of continuing its operations at the applicable qualified business; or
(4) the date the Bank notifies the qualified business and the governing body that the qualified business is not in compliance with any requirement for designation as an enterprise project.
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 August 21, 2025.
TRD-202503034
Adriana Cruz
Executive Director
Office of the Governor, Economic Development and Tourism Office
Effective date: September 10, 2025
Proposal publication date: May 2, 2025
For further information, please call: (512) 463-2000