A company which will be creating primary jobs may be eligible for a grant to cover expenditures related to land, building, facilities and site improvements. The number of jobs created and capital investment will be a key factor in determining grant awards. Eligible projects will include manufacturing, industrial, research and development, recycling, small warehouse and corporate headquarter facilities and distribution centers.

A company which will be a commercial or retail project may also be eligible for an infrastructure grant and business-related sewer utilities and site improvements. In addition, manufacturing, industrial, research and development, recycling, mall warehouse and corporate headquarter facilities and distribution centers are also eligible for an infrastructure grant and business-related sewer utilities and site improvements. Capital investment will be a key factor in determining grant awards.

A company which will be creating primary jobs may be eligible for a grant to cover job training. In addition, assistance for job training may be available for commercial and retail projects.

A company may be eligible for a property tax reimbursement based on the number of primary jobs created and total capital investment. In addition, a retail business may be eligible for a sales tax reimbursement to cover eligible expenses noted as infrastructure improvements and business-related sewer utilities and site improvements.

A business located in the downtown district may be eligible for assistance with storefront improvements and signage. Businesses should be open in the City of Mercedes for a minimum of one year to be considered.

The Self Sufficiency Fund assists businesses by designing, financing and implementing customized job training programs in partnership with public community and technical colleges, a higher education extension service, & community-based organizations for the creation of new jobs and/or the retraining of existing workforce. The goal of the Self-Sufficiency Fund is to assist recipients of Temporary Assistance for Needy Families, Food Stamps, and Needy Parents to obtain training, get jobs, and become independent of government financial assistance. Businesses and trade unions must partner with an eligible applicant in order to be considered for Self-Sufficiency Fund grants.

The South Texas Manufacturers Association (STMA) Apprenticeship Program, certified and registered by the U.S. Department of Labor Bureau of Apprenticeship and Training, is a joint training alliance developed by the STMA and South Texas College. The program offers apprentices the unique opportunity to receive classroom instruction in conjunction with practical, hands-on (OJT) training at their respective companies. Apprentices must be employed full-time in an occupation related to their training and be sponsored by their employer as an apprentice. Currently, the STMA Apprenticeship Program offers training classes in Tool and Die and Industrial Maintenance, both of which are four years in length. Upon completion, apprentices will be certified by the Department of Labor as Journeymen Tool and Die Makers or Industrial Maintenance Technicians.

The Skills Development Fund program assists businesses and trade unions by financing the design and implementation of customized job training projects. This fund successfully merges business needs and local customized training opportunities into a winning formula to increase the skills level and wages of the Texas workforce. Businesses and trade unions must partner with an eligible applicant in order to be considered for Skills Development Fund grants. Eligible applicants are public community or technical colleges, the Texas Engineering Extension Service or a community-based organization working in partnership with one of these institutions. Grants for a single business may be limited to $500,000.

The Partnership for Business and Industry Training at South Texas College offers customized training to area businesses, industries and the community. Training programs are tailored to the client's needs in content, schedule and location. This Division of STC offers a diverse assortment of courses that satisfy employer needs for customized training to upgrade current employees and prepare new employees. Also, mandatory Continuing Education Units meeting licensing requirements are available for certified professionals. A business needing customized training may partner with STC to provide training at a rate of $4.50 per training hour X number of employees X number of training hours.

The Work Opportunity Tax Credit is a federally funded program that is used to reduce the federal tax liability for private-for-profit employers who hire new employees from criteria ‘targeted’ groups. The allowable tax credit could be as much as $2,400 per employee.

The Taxpayer Relief Act of 1997 authorized the W-2-W credit for long-term family assistance recipients. The allowable federal tax credit could be as much as $8,500 per employee.

An employer that pays wages during the first year of employment to an employee who is a Texas resident and received AFDC/TANF benefits during the month of hire may recover up to 20% of $10,000 in wages paid during the first year of employment; which means a refund from the State of up to $2,000 per employee. The employer must offer some form of health care benefits to the employee in order to qualify.

The Customized Training Program is available to assist employers with new and incumbent worker training that is customized to the business and operation of the employer. This program reimburses employers up to 50% of the total cots of the training. This program is intended to provide employers with training funds that will be utilized to promote a training environment that will provide employees with higher skills and competencies to perform their job.

Up to 50% reimbursement of employee’s wages is possible for up to 25% of the workforce eligible under WIA for up to six months.

The County of Hidalgo offers a property tax abatement to qualifying companies based on the number of employees and the amount of investment. The minimum capital cost of the project should be $1.5 million and the minimum number of jobs created should be 26 to qualify for an abatement.

Projects that are considered for Enterprise Fund support must demonstrate a project’s worthiness, maximize the benefit to the State of Texas and realize a significant rate of return of the public dollars being used for economic development in Texas. Capital investment, job creation, wages generated, financial strength of the applicant, applicant’s business history, analysis of the relevant business sector, and federal and local government and private sector financial support of a project will all be significant factors in approving the use of the Enterprise Fund. The Governor, Lieutenant Governor, and the Speaker of the House must unanimously agree to support the use of the Texas Enterprise Fund for each specific project.

This program will work through partnerships between the state, institutions of higher education and private industry to focus greater attention on the research, development and commercialization of emerging technology. The Emerging Technology Program is dedicated to three areas:

• Regional Centers of Innovation and Commercialization which will become concentrated with applied R&D activities, be incubators (including specialized workforce training) for startup firms and encourage expansion of existing companies resulting from commercializing their developments.
• Matching grant funds. Applied technology research and development projects that accelerate commercialization into production and have a demonstrated ability to receive or have received federal grants or non-state grants may apply for matching dollars from the Emerging Technology Fund. Grants such as Small Business Innovation Research grants, Small Business Technology Transfer grants, etc.
• Attracting research talent. The state will help Texas public universities attract highly renowned research teams from universities and institutions in other states.

A community with less than 250,000 in population may have up to four enterprise projects. Upon a community designating a business as an enterprise project, and upon that project’s designation being approved by the state, the business would be eligible for a refund for state sales and use taxes paid for building materials, machinery and equipment, electricity and natural gas purchased and consumed in the normal course of business and depending on investment amount and number of jobs created or retained. The refund can be an amount ranging from a minimum of $2,500 per job to a maximum of $7,500 per job as follows.

The Texas Leverage Fund is an "economic development bank" offering an added source of financing to communities that have passed the economic development sales tax. EDT may loan funds directly to a local Industrial Development Corporation to finance eligible projects. Sales tax revenues pledged by the IDC need only be sufficient to cover projected annual debt service as specified in the Texas Leverage Fund Program Guidelines. This allows cities to leverage their economic development sales tax and to pursue additional projects.

The Texas Capital Fund Infrastructure Program, administered by Texas Department of Agriculture, is an economic development tool designed to provide financial resources to non-entitlement communities. Funds from this program can be utilized for public infrastructure (water, sewer, roads, etc.) needed to assist a business, which commits to create and/or retain permanent jobs, primarily for low and moderate-income persons. The minimum award is $50,000 and the maximum is $750,000. The award may not exceed 50% of the total project cost. Total Texas Capital Fund participation from both Infrastructure program and Real Estate Development program may not exceed $750,000.

The Texas Capital Fund Real Estate Development Program, administered by Texas Department of Agriculture, is designed to provide financial resources to non-entitlement communities. Funds must be used for real estate development (acquisitions, construction and/or rehabilitation) to assist a business, which commits to create and/or retain permanent jobs, primarily for low and moderate-income persons. The minimum award is $50,000 and the maximum is $750,000. The award may not exceed 50% of the total project cost. Funds are provided with no interest accruing and with payments based on a 20-year amortization schedule. Total Texas Capital Fund participation from both Infrastructure program and Real Estate Development program may not exceed $750,000.

The Rural Municipal Finance Program was created by the Texas Agricultural Finance Authority to stimulate economic activity in rural Texas. This loan program is designed for eligible applicants located within rural areas of the state that provide significant benefits for the rural area, and provide evidence of ability to repay the commitments. Applicants can include: city and county governments; economic development corporations; hospital districts; rail districts; utility districts; special districts; agricultural districts; and private water and wastewater corporations.

An applicant must certify to TAFA that:

1. The project is located in a non-metropolitan statistical area (county); or
2. If in a metropolitan statistical area, the project is in an unincorporated area; or
3. Located in a city with a population of under 20,000, that is not adjoining a city or group of cities with an aggregate population of 50,000 or greater.

Loan amounts range from $50,000 to an amount approved by TAFA’s board of directors, but target projects for less than $1,000,000. Loans may be used for real estate purchase, building construction, site improvements, equipment, water and wastewater systems, municipal infrastructure projects and any other use that can be identified to improve or assist in the economic development of the rural area.

A community may choose to offer the Freeport exemption for various types of goods that are detained in Texas for a short period of time. Freeport property includes goods, wares, merchandise, ores, and certain aircraft and aircraft parts. Freeport property qualifies for an exemption from ad valorem taxation only if it has been detained in the state for 175 days or less for the purpose of assembly, storage, manufacturing, processing, or fabricating.

• Manufacturing Machinery & Equipment Leased or purchased machinery, equipment, replacement parts, and accessories that have a useful life of more than six months, and that are used or consumed in the manufacturing, processing, fabricating, or repairing of tangible personal property for ultimate sale, are exempt from state and local sales and use tax. Texas businesses are exempt from paying state sales and use tax on labor for constructing new facilities. In addition, Texas businesses are exempt from paying state sales and use tax on the purchase of machinery exclusively used in processing, packing, or marketing agricultural products by the original producer at a location operated by the original producer.
• Natural Gas & Electricity Texas companies are exempt from paying state sales and use tax on electricity and natural gas used in manufacturing, processing, or fabricating tangible personal property. The company must complete a “predominant use study” that shows that at least 50% of the electricity or natural gas consumed by the business directly causes a physical change to a product.

• Sales Tax Bonds Sales Tax Bonds do not fall under the volume cap and are eligible to communities that have passed the economic development sales tax. Ineligible projects include for-profit hospitals, multi-family projects and municipal services.
• Exempt-Facility Bonds Bonds can be issued to finance certain facilities such as airports, dock and wharf facilities, mass commuting facilities, high-speed inter-rail facilities, or certain qualified hazardous waste facilities (including certain training and storage facilities). There is no limit on the amount of the issue and these issues do not require a reservation under the volume cap. Although the facility must be governmentally owned, it may be leased or subject to management contracts with the business. Other types of exempt bonds include projects for water, sewage and solid waste facilities, facilities for the local furnishing of electricity or gas, local district heating or cooling facilities. These types of exempt-facility issues must reserve a portion of the volume cap. Exempt-facility bonds that are not governmentally owned may reserve up to $25 million in tax-exempt volume cap allocation each year, however, there is no restriction to project size.
• Tax-Exempt Industrial Revenue Bonds Tax-Exempt Industrial Revenue Bands are designed to provide tax-exempt financing to finance land and depreciable property for eligible industrial or manufacturing projects. The maximum bond amount is $20 million, which can include certain capital and administrative costs. These issues must receive a reservation under the State's volume limitation ("volume cap") managed by the Texas Bond Review Board.

The Texas Small Business Fund is a program that provides capital loans for small business growth and expansion. The Fund is a revolving loan program with capital provided from $20 million in taxable bonds issued in 2005. The Office of the Governor, Texas Economic Development Bank administers the Fund at the direction of the Governor’s appointed nine member board. The goal of the program is to foster and stimulate the development of small business in Texas. Preference for funding will be given to the state’s defined industry clusters within emerging technology fields including semiconductors; nanotechnology; biotechnology and biomedicine; renewable energy; agriculture and aerospace. Funds may be used for working capital, machinery, equipment, furniture and fixtures.

The Texas Product Development Fund provides financing to aid in the development, production and commercialization of new or improved products within the state. Products appropriate for the fund are inventions, devices, techniques, or processes that have advanced beyond the theoretical stage and are ready for immediate commercial application. Preference for funding will be given to the state’s defined industry clusters within the emerging technology fields including semiconductors; nanotechnology; biotechnology and biomedicine; renewable energy; agriculture and aerospace. Job creation and job retention within Texas will be considered within funding priorities. The Fund is a revolving loan program with capital provided from $20 million in taxable bonds issued in 2005. The Office of the Governor, Texas Economic Development Bank administers the Fund at the direction of the Governor’s appointed nine member board.