Texas Enterprise Fund
The Texas Enterprise Fund (“TEF”) is a cash grant used as a financial incentive tool for projects that offer significant projected job creation and capital investment and where a single Texas site is competing with another viable out-of-state option. Often referred to as the “deal-closing fund”, the TEF has awarded over 140 grants totaling nearly $600 million across a wide variety of industries and projects committed to creating more than 80,000 jobs and investing more than $27 billion.
The award amounts vary and are determined using an analytical model that is uniformly applied to each TEF applicant. The model helps assure that the state will see a full return on its investment. Award amounts will depend on the expected number of jobs, the expected timeframe for hiring and the average wages to be paid.
To be eligible for consideration, a project must meet the following criteria:
- Competition with another state for the project must exist and the business must not have already made a location decision.
- Projected new job creation must be significant – past recipients have typically created more than 75 jobs in urban areas or more than 25 in rural areas.
- The new positions must be high-paying jobs – above the average wage of the county where the project would be located.
- Capital investment by the company must be significant.
- A significant rate of return on the public dollars being invested in the project must be demonstrated.
- The project must have community involvement from the city, county, and/or school district, primarily in the form of local economic incentive offers.
- The applicant must be a well-established, financially sound business.
- The applicant’s business sector must be an advanced industry that could potentially locate in another state or country.
- The Governor, Lieutenant Governor, and the Speaker of the House must unanimously agree to support the use of TEF for each specific project.
Once a company has been awarded and has accepted an offer from the TEF, a signed contract is required prior to receiving any funds. The TEF grant recipients are contractually obligated to fulfill the terms of their job creation agreements with the state of Texas. All TEF contracts contain provisions for grant repayment through clawbacks in the event the TEF grant recipient does not meet the obligations of the agreement.
How to Apply:
Each applicant undergoes a thorough 11-step due diligence process. Corporate activity, financial standing, tax status, legal issues, credit ratings, and estimated economic impacts, as well as the business climates of competition locations are reviewed for each project and taken into consideration for all award decisions. The Economic Development & Tourism division of the Office of the Governor administers the Texas Enterprise Fund.