Texas Administrative Code › Title 10 - COMMUNITY DEVELOPMENT › Part 5 - OFFICE OF THE GOVERNOR, ECONOMIC DEVELOPMENT AND TOURISM OFFICE › Chapter 176 - ENTERPRISE ZONE PROGRAM › Section 176.1 - General Provisions

Current through Reg. 49, No. 28; July 12, 2024
(a) Purpose. It is
				the purpose of the Texas Enterprise Zone Act to establish a process that
				clearly identifies distressed areas and provides incentives by both local and
				state government to induce private investment in those areas by the provision
				of tax incentives and economic development program benefits for the creation
				and retention of high quality jobs. Under this program economic development is
				encouraged by allowing enterprise projects to be designated outside of an
				enterprise zone, with a higher threshold of hiring economically disadvantaged
				or enterprise zone residents. The purpose of these sections is to provide
				standards of eligibility and procedures for designation of applications for
				qualified businesses as enterprise projects.
(b) Definition of terms. The following words
				and terms, when used in this chapter, shall have the following meanings, unless
				the context clearly indicates otherwise.
(1)
				Act--The Texas Enterprise Zone Act, Chapter 2303, Texas Government Code, as
				amended.
(2) Active
				designation--The period of time from the designation date to the ending date of
				the project or activity as provided in the nominating ordinance, order or
				resolution.
(3) Applicant--The
				municipality or county filing an application with the Bank on behalf of a
				qualified business for designation of an enterprise project under the Act,
				§2303.405, and this chapter.
(4) Application date--The first business day
				of the months of September, December, March and June, if there are designations
				available.
(5) Approval date--The
				application date of an enterprise project as approved by the Bank.
(6) Capital investment--Money paid to
				purchase capital assets to be used in the regular conduct of the business or
				activity at the qualified business site, or fixed assets including but not
				limited to land, buildings, labor used to construct or renovate a capital
				asset, furniture, manufacturing machinery, computers and software, or other
				machinery and equipment. Expenditures for routine and planned maintenance
				required to maintain regular business operations are only considered qualified
				capital investment if there will be a measurable increase in production
				capacity or if the expenditures will result in increased productivity which may
				be expressed as a decrease in the overall cost per unit produced, and are
				limited to 40 percent of the total capital investment spent at the qualified
				business site. Property that is leased under a capitalized lease is considered
				a qualified capital investment but property that is leased under an operating
				lease is not considered a qualified capital investment.
(7) Claim period--A twelve-month period,
				during the active designation period, for which hours are accumulated by
				qualified employees to be claimed for benefit.
(8) Concurrent designation--Two or more
				enterprise project designations for the same qualified business at the same
				qualified business site for separate projects or activities, with overlapping
				designation periods.
(9) Controlled
				group--A group of businesses as defined in Title 26, Subtitle A, Subchapter B,
				Part II, Section 1563(a), Internal Revenue Code, or business entities with the
				same ownership.
(10) Director--The
				Director of the Texas Economic Development Bank.
(11) Distressed county--A county that has a
				poverty rate above 15.4 percent based on the most recent decennial census; in
				which at least 25.4 percent of the adult population does not hold a high school
				diploma or high school equivalency certificate based on the most recent
				decennial census; and that has an unemployment rate that has remained above 4.9
				percent during the preceding five years, based on Texas Workforce Commission
				data.
(12) Economic Development and
				Tourism--Economic Development and Tourism Office in the Governor's Office
				(Office) as established under Chapter 481, Texas Government Code.
(13) Eligible taxable proceeds--Taxable
				proceeds generated, paid, or collected by a qualified hotel project or a
				business at a qualified hotel project including hotel occupancy taxes, ad
				valorem taxes, sales and used taxes, and mixed beverage taxes.
(14) Enterprise project--A designation given
				to a qualified business by the Bank under the Act, § 2303.406, and §
										RSA
				176.3 of this title (relating to
				Qualification for Designation of Enterprise Projects) making the qualified
				business eligible for the state tax incentives provided by law for an
				enterprise project.
(15) Executive
				Director--The Executive Director of the Office.
(16) Extraterritorial jurisdiction--Territory
				in the extraterritorial jurisdiction (ETJ) of a municipality that is considered
				to be in the jurisdiction of the municipality, as defined by Chapter 42, Local
				Government Code.
(17) Governing
				body--The governing body of a municipality or county participating in the
				program.
(18) Governing body
				liaison--The person who holds the position set out in the ordinance or order
				indicating participation in the program, for the municipality or county to
				communicate and negotiate with the Bank or Office, qualified businesses
				nominated to be enterprise projects and any other entities affected by the
				enterprise zone.
(19) Local
				government--A municipality or county.
(20) Local incentive--Each tax incentive,
				grant, other financial incentive or benefit, or program to be provided by the
				governing body to business enterprises through the program.
(21) Ninety-day window--The period 90 days
				prior to the quarterly application deadline date for which an enterprise
				project is approved. The period of time in which the project may begin making
				investment and creating jobs for purposes related to the enterprise project
				designation.
(22) Nominating
				body--The governing body of a municipality or county that nominated a project
				or activity of a qualified business for designation as an enterprise project
				which is located within the jurisdiction of that governing body.
(23) Primary job--A job to be created or
				retained for benefit by a designated enterprise project, as defined by the
				Development Corporation Act of 1979.
(24) Qualified property--Any one or more of
				the following:
(A) tangible personal property
				located at the qualified business site that was acquired by a taxpayer not
				earlier than the 90th day before the date of designation as an enterprise
				project and was or will be used predominantly by the taxpayer in the active
				conduct of a trade or business;
(B)
				real property located at a qualified business site that:
(i) was acquired by the taxpayer not earlier
				than the 90th day before the date of designation of the enterprise project, and
				used predominantly by the taxpayer in the active conduct of a trade or
				business; or
(ii) was the principal
				residence of the taxpayer on the date of the sale or exchange; or
(C) interest in a corporation,
				partnership, or other entity if, for the most recent taxable year of the entity
				ending before the date of sale or exchange, the entity was a qualified
				business.
(25)
				Staff--The staff of the Texas Economic Development Bank.
(26) Undocumented worker--An individual who,
				at the time of employment, is not:
(A)
				lawfully admitted for permanent residence to the United States; or
(B) authorized under law to be employed in
				that manner in the United States.