Texas Enterprise Fund

The Texas Enterprise Fund (TEF), administered by the Office of the Governor's Economic Development & Tourism Office, represents one of the most significant economic development tools available to the State of Texas. TEF awards performance-based “deal-closing” cash grants to companies that are considering new projects in Texas but are also evaluating at least one viable out-of-state location. The intent is to provide a financial incentive to encourage companies to choose Texas for projects that bring substantial capital investment and job creation to the state. Through this program, Texas positions itself as a competitive and appealing destination for domestic and international business expansion. To be eligible for TEF funding, companies must propose projects involving either a facility opening or expansion that result in significant job creation and capital investment. The projects must meet job creation thresholds: more than 75 full-time jobs in urban areas or 25 in rural areas. Applicants must also demonstrate that their proposed Texas site is in genuine competition with one or more locations in other states, and that no final location decision has been made. Evidence that would disqualify a project includes signing a lease, purchasing property, hiring employees, or issuing a public location announcement. In addition to job creation thresholds, the wage level of new jobs must meet or exceed the average wage of the county where the project will be located for the full term of the grant agreement. Applicants are expected to make significant capital investments and must be financially sound, well-established companies operating in advanced industries with feasible alternatives across the U.S. or internationally. Furthermore, local governmental support from city, county, or school district entities in the form of local incentives is a required element for consideration. The TEF application process is conducted on a rolling basis and begins with the submission of a full application through the TEF Portal. All applicants undergo an extensive 11-step due diligence review by the Governor’s Office, covering factors such as project competitiveness, economic impact, legal and financial standing, and the business climate of competing locations. Final decisions are made by the Governor, Lieutenant Governor, and Speaker of the House, all of whom must unanimously approve the use of TEF funds for a given applicant. If selected for a TEF grant, companies must enter into a legally binding grant agreement that includes specific obligations for job creation and wage levels, typically reviewed on an annual basis. Grant funds are not disbursed until performance metrics are met, and companies are required to maintain these standards for the duration of the contract. Failure to do so may result in the state seeking repayment of distributed funds through clawback provisions. There is no pre-application phase or published deadline since applications are accepted year-round. However, applicants should be prepared for a comprehensive evaluation and multi-party approval process. Following the signing of the grant contract, companies are also expected to participate in a joint press release with the Governor’s Office. For more information or application access, applicants should visit the TEF Portal or contact the Texas Economic Development Office at (512) 936-0100.