Texas introduced a new economic incentives program to attract new businesses and employment opportunities to the state. This initiative, termed the Texas Jobs Energy, Technology, and Innovation (JETI) program, was initiated by Governor Greg Abbott and replaces Chapter 313. The decision to phase out Chapter 313 was made following complaints regarding its perceived contribution to disparities in public school funding.

The JETI program, which received bipartisan backing from lawmakers, offers property tax reductions to eligible companies relocating to Texas communities in exchange for job creation. Unlike its predecessor, JETI incorporates stricter oversight of participating companies, imposes additional job and salary criteria, and reduces property tax cuts by half.

Governor Abbott highlighted Texas’ status as a leading job generator and emphasized maintaining competitiveness in national and global markets. Under the new program, companies can apply for a 10-year reduction in property taxes, with the state compensating school districts for lost tax revenue using its general revenue fund. However, the extent to which taxpayers will bear the burden of these tax breaks remains uncertain.

Critics of Chapter 313 had raised concerns about inequality in school funding resulting from companies’ direct payments to schools in exchange for tax breaks. In response, the JETI program eliminates this provision.

The replacement of Chapter 313 was prompted by pressure from business leaders, as its expiration was perceived to have negatively impacted Texas’ ability to attract corporate projects. Consequently, the new program was swiftly enacted to prioritize economic development.

Participating companies are now required to create a specific number of new full-time jobs with competitive salaries and benefits and periodically report their compliance with these standards to the state. Additionally, the program offers varying tax cuts based on the project’s location, with economically disadvantaged areas receiving higher incentives.