Mon, May 19, 2014
Chapter 313 Legislative Background
In 2001, in response to several high-profile, capital-intensive economic development projects deciding to locate outside the state, the 77th Texas Legislature enacted House Bill 1200, creating Tax Code Chapter 313, the Texas Economic Development Act. Effective January 1, 2014, the Act allowed school districts to attract new, taxable property and create jobs by offering a value limitation for a period of 10 years, beginning January 1 of the year following the application date or the date commercial operations begin at the site of the project.
Chapter 313 Program Overview
In the value limitation agreement, a company must make a minimum investment, which varies by school district, based on a financial formula applied to each district, and supplemental payments to the district on a per-student basis. The company must also create a minimum number of jobs that meet certain criteria, including an average annual wage 10% above the average for the specified region. The State of Texas reimburses the local school district for any loss of tax revenue in the approval of a Chapter 313 agreement. The Chapter 313 program is administered by the Texas Comptroller of Public Accounts and applies to large-scale manufacturing, R&D, renewable energy, data center and other qualified industrial projects.
Notable HB 3390 Legislative Updates
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