The Texas Skills Development Fund remains one of the most practical state-funded programs available to Texas employers in 2026. Administered by the Texas Workforce Commission (TWC), the program provides grants to public community and technical colleges to deliver customized job training for businesses that are creating new jobs or upgrading the skills of their existing workforce. This guide covers what has changed, current funding availability, and how Texas businesses can access the program in 2026.
Program Overview
The Skills Development Fund does not provide money directly to businesses. Instead, it funds training delivered through a partnership between the employer and a public community or technical college. The college applies for the grant on behalf of the business, and the grant covers the cost of developing and delivering the customized training curriculum. The employer contributes matching resources, which can include trainee wages, facility space, equipment, or materials. See our complete Skills Development Fund guide.
2026 Funding Status
- Budget cycle: The Texas Legislature sets the Skills Development Fund budget in each biennial session. The current biennium budget determines the total funding available for FY 2025–2026 awards.
- Application availability: TWC accepts applications on a rolling basis throughout the fiscal year, subject to available funding. Applications are reviewed and awarded as they are received rather than through a single competitive deadline.
- Award amounts: Individual grants have ranged from under $100,000 to over $1 million, depending on the number of trainees and the scope of training. Most awards fall in the $100,000 to $500,000 range.
- Industry focus: While the program is open to all industries, manufacturing, healthcare, technology, construction, and logistics employers have been consistent users of Skills Development Fund grants.
What Has Changed
TWC has made incremental updates to the program in recent cycles:
- Streamlined applications: The application process has been simplified in recent years, with clearer guidelines and faster turnaround for smaller projects.
- Consortium applications: Multiple employers in the same industry or region can apply together through a single community college partner, sharing the administrative overhead and enabling smaller employers to participate.
- Priority industries: TWC may give priority to proposals that address workforce shortages in high-demand industries identified in the state workforce plan.
How to Apply
- Identify your training needs: Document the specific skills your workforce needs, the number of employees to be trained, and the business outcomes you expect from the training.
- Partner with a community college: Contact the workforce or continuing education division of a public community or technical college in your area. The college will serve as the grant applicant and training provider.
- Develop the curriculum: Work with the college to design a customized training program that meets your specific needs. The curriculum should align with measurable skill acquisition outcomes.
- Submit the application: The college submits the grant application to TWC, including the training plan, budget, employer commitment letter, and projected outcomes.
- Deliver the training: Once approved, the college delivers the training according to the approved plan. TWC reimburses the college for eligible training costs.
Industries Using Skills Fund in 2026
Related Workforce Programs
- WOTC hiring tax credits — tax credits for hiring from target groups
- Apprenticeship programs — earn-and-learn workforce development
- Workforce Solutions services — free recruitment and labor market resources
Find Your Workforce Program Match
The Skills Development Fund is one of several workforce programs that can reduce training and hiring costs for Texas employers. Our screening report identifies which workforce, tax credit, and incentive programs match your business. Start your free screening →