The Texas Skills Development Fund is one of the most accessible state-level grant programs available to Texas employers. Administered by the Texas Workforce Commission (TWC), the fund provides grants to community and technical colleges to design and deliver customized job training programs for businesses. Unlike many incentive programs that target only large employers, the Skills Development Fund is available to businesses of all sizes.
This guide explains how the Skills Development Fund works, what the published eligibility criteria are, how to apply, and how to maximize the value of a training grant.
How the Skills Development Fund Works
The Skills Development Fund is a grant-to-college model. The Texas Workforce Commission awards grants to public community colleges, technical colleges, or the Texas A&M Engineering Extension Service (TEEX). These institutions partner with one or more businesses to design and deliver customized training programs. The grant covers training costs, and the business gets trained workers at no direct training cost.
The business is the driver of the training content — you define the skills your workers need, and the college partner designs the curriculum. The TWC reviews and funds the grant application.
What the Grant Covers
- Instructor costs and training delivery
- Curriculum development and training materials
- Training equipment and supplies
- Facility usage for training delivery
- Administrative costs for the college partner
The grant does not cover employee wages during training. However, because the business selects the training content and schedule, training can be structured to minimize disruption to operations.
Published Eligibility Criteria
Based on published TWC guidelines, the following criteria apply:
- Texas employer: The business must be an employer operating in Texas.
- Partnership with a public college: The application must involve a partnership between the business and a public community college, technical college, or TEEX.
- New job creation or existing worker training: The grant can fund training for new hires or skills upgrades for existing workers.
- Wage standards: Jobs supported by the training should pay competitive wages. TWC evaluates wages as part of the application.
- No size restrictions: The fund is available to businesses of all sizes, from small businesses to large employers. Consortia of small businesses can apply together.
How to Apply
Step 1: Identify Your Training Need
Define the skills gap you need to address. This could be training for new hires at a new facility, upskilling existing workers for new equipment or processes, or industry-specific certification training.
Step 2: Partner with a Community College
Contact the workforce training or continuing education department at your local community college. Most Texas community colleges have staff experienced with Skills Development Fund applications and can guide the process. Key college partners across Texas include:
- Houston Community College
- Lone Star College
- Dallas College
- Tarrant County College
- Austin Community College
- Alamo Colleges District (San Antonio)
- El Paso Community College
- Collin College
Step 3: Develop the Application
The college partner takes the lead on preparing the grant application, working with you to define the training plan, budget, timeline, and expected outcomes. The application includes details about the business, the jobs being trained, the training curriculum, and projected wages.
Step 4: TWC Review
TWC reviews and scores applications based on job creation or retention impact, wage levels, training quality, and alignment with state workforce goals. Approved grants are awarded on a competitive basis throughout the year.
Grant Amounts
Skills Development Fund grants vary in size based on the number of workers trained, the complexity of the training, and the duration of the program. Individual grants can range from tens of thousands to several hundred thousand dollars. Multi-business consortia grants can be even larger.
Small Business Consortia
One of the most valuable features of the Skills Development Fund for small businesses is the consortium model. Multiple small businesses with similar training needs can partner together through a community college to submit a single application. This gives small businesses access to the same training resources available to large employers.
A local workforce board, industry association, or the community college can help organize a consortium of businesses with common training needs.
Related Workforce Programs
The Skills Development Fund is part of a broader set of Texas workforce programs:
- JET Grant (Jobs and Education for Texans): Equipment grants for community colleges to support career and technical education programs. Businesses benefit indirectly through a better-trained talent pipeline.
- Workforce Innovation and Opportunity Act (WIOA): Federal workforce funds administered through local workforce boards. WIOA supports on-the-job training and apprenticeship programs. Full guide to workforce training grants.
- Registered Apprenticeship: Businesses can establish registered apprenticeship programs that combine on-the-job training with classroom instruction, potentially funded through WIOA and other sources.
Tips for a Strong Application
- Be specific about outcomes: Clearly define how many workers will be trained, what skills they will gain, and what wages they will earn.
- Demonstrate business need: Show that the training addresses a real skills gap that limits your business growth.
- Engage early: Contact your community college partner well before you need the training. Application development takes time.
- Consider consortia: If you are a small business, ask your college partner about joining a consortium application.
Find Programs That May Fit Your Business
The Skills Development Fund is one of many programs available to Texas businesses. You may also be eligible for tax credits, procurement certifications, SBA loans, and other incentives.
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