Texas counties may offer economic development incentives through Chapter 381 of the Local Government Code, which authorizes counties to provide grants, loans, guarantees, and other financial incentives to promote economic development. Chapter 381 agreements are the county equivalent of Chapter 380 city agreements and may be available to businesses creating jobs or investing capital in Texas counties.
How Chapter 381 Works
Chapter 381 authorizes Texas counties to establish programs for economic development, including making grants and loans from county funds, providing personnel and services, and offering tax abatements and other incentives. Unlike cities, counties have more limited revenue sources, so Chapter 381 incentives often take different forms than city Chapter 380 agreements.
Common Chapter 381 Incentives
- Property tax abatements: Temporary reductions in county property taxes for qualifying investments
- Infrastructure support: Road improvements, utility extensions, and site preparation assistance
- Cash grants: Performance-based grants tied to job creation and investment thresholds
- Fee waivers: Reduction or waiver of county development fees and permits
Which Texas Counties Use Chapter 381
Most Texas counties with active economic development programs use Chapter 381 authority. Harris, Dallas, Bexar, Tarrant, Travis, and other urban counties regularly negotiate Chapter 381 agreements for significant business investments. Rural counties also use Chapter 381, often in coordination with state and federal programs.
Eligibility and Application
Chapter 381 agreements are typically negotiated individually. Eligibility usually requires minimum job creation commitments, capital investment thresholds, and alignment with the county's economic development priorities. Contact your county's economic development office or judge's office to inquire about available programs.
Chapter 381 vs. Chapter 380
Chapter 380 applies to cities and Chapter 381 applies to counties. Businesses may receive incentives from both the city and county simultaneously. Combining city and county incentive packages can significantly increase the total value of local development support.
Find More Programs for Your Business
The Chapter 381 County Economic Development Incentives in Texas is just one of many programs that Texas businesses may be eligible for. Federal, state, and local governments offer a range of grants, tax credits, loans, and incentives.
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