DEVELOPMENT OF A TASK FORCE & PROSPECT SITE VISITS … · market-driven economic development...

DEVELOPMENT OF A

TASK FORCE &

PROSPECT SITE VISITS

Betty RussoOffice of the Governor

Economic Development & Tourism

281.222.6814 | gov.texas.gov/business

Updated annually in July

E D T O V E RV I E W

L E A D G E N E R AT I O N

R F I R E S P O N S E P R O C E S S

I N C E N T I V E S & F I N A N C I N G

The Governor's Office of Economic Development and Tourism (EDT)

promotes the State of Texas as a leading global business climate and

premier travel destination.

O F F I C E O F T H E G O V E R N O R

E C O N O M I C D E V E L O P M E N T & TO U R I S M

Economic Development focuses on domestic and international business recruitment, expansion and

retention, with the goal of creating jobs and enhancing opportunities for the Texas business community.

Business & Community

Development

Texas Workforce Investment

Council

Travel Texas

Texas Music Office

Texas Film Commission

The Governor’s

Commission for Women

Texas Military Preparedness Commission

The Governors’ Office of Economic Development & Tourism

Business & Community Development focuses on domestic and international

business recruitment, expansion and retention, with the goal of creating jobs

and enhancing opportunities for the Texas business community.

• Business recruitment • Business assistance

• Site selection • Permit assistance

• Project coordination • Trade & export promotion

• Community relations • Small business advocacy

• State incentives & financing

programs

• Industry research &

analysis

BUSINESS & COMMUNITY DEVELOPMENT SERVICES

O F F I C E O F B U S I N E S S C O M M U N I T Y A N D

D E V E L O P M E N T

C O O R D I N AT E D E F F O R T

State of Texas

OOG, TDA, Comptroller,

TCEQ

Company

County

Municipality

Water, Gas, Electric

Other AlliesCOG’s,

SBDC’s, FTA

Workforce

Texas Economic Development

Corporation (TxEDC)

businessintexas.com

• Public-private partnership

• Key marketing entity for the State

of Texas Economic Development

• Trade visits and special projects

• Statewide network of business

leaders

The Texas Governor’s Office of

Economic Development & Tourism (EDT)

gov.texas.gov/business

• Site selection

• Project management

• Business retention, expansion and/or

relocation

• Business incentives program

*EDT also includes The Office of Small Business and

the Texas Economic Development Bank.

Ongoing

Discussion

+

Feedback

E C O N O M I C D E V E L O P M E N T I N T H E S TAT E O F T E X A S

TA S K F O R C E

Important to develop a Task Force

Key Players should include:

• Local Government

• Workforce Development Organizations

• State Government

• Neighborhood Groups

• Chamber of Commerce/Business Associations

• Educational Institutions

• Community Non-Profits/Public-Private Partnerships

• Utilities

• Federal Government

• Philanthropic Organizations

Ta s k F o r c e D e ve l o p m e n t

International Economic Development Corporation

L E A D G E N E R AT I O N S T R AT E G Y

The state’s vision to build its future economy includes the cluster

initiative. The cluster initiative was created to provide a coordinated,

market-driven economic development strategy focusing on

industries with the greatest growth potential.

Texas’ six industry clusters include:

• Advanced Technology & Manufacturing

• Aerospace, Aviation & Defense

• Biotechnology & Life Sciences

• Energy

• Information & Computer Technology

• Petroleum Refining & Chemical Products

• Corporate Headquarters

• Distribution & Logistics

L E A D G E N E R AT I O N I N D U S T RY C L U S T E R S

• More than half of all leads received are the result of a

relationship our staff have cultivated with a site selection

consultant

• A second source of leads are direct leads from companies

following trade missions, outreach meetings or via our website

• A final source of leads are “blind leads”, which result from a

consultant or company contacting the state via fax, e-mail or

phone

H O W T H E S TAT E R E C E I V E S L E A D S

L E A D S O U R C E

In order to receive leads from the State of Texas you must:

• Have a full-time professional dedicated to economic

development

• Know how to put together a proposal

• Fill out a “Prospect Leads Request Form” and return it to SBD

coordinator or your regional representative

• Have only one recipient of leads per community

• Leads recipient can’t be consultant or for-profit entity

H O W C O M M U N I T I E S R E C E I V E L E A D S

• Company or site selection consultant contacts the state and

provides an “RFI” or “RFP”

• Governor’s Office disseminates lead statewide or to one or more

regions based upon the criteria outlined by the prospect

• It is possible that only a few counties within a region will meet

the prospect’s geographic criteria (ie. Central Texas w/in 30

miles of an international airport)

• It is up to the community to determine whether or not they meet

the prospect’s criteria

• State receives proposals from local communities and returns to

company/consultant for analysis

L E A D & P R O J E C T M A N A G E M E N T P R O C E S S

• Company selects Texas communities to visit

• Company narrows list to a single Texas site and sites in other

states

• State of Texas puts together incentive package to complement

local efforts

• Possible Texas Enterprise Fund negotiations

• Prospect decides to locate in TEXAS!

L E A D A N D P R O J E C T M A N A G E M E N T P R O C E S S

REGIONAL LEADMAP

Regional Utility Allies

Central Texas:

• American Electric Power

• Bluebonnet Electric

Cooperative

• Entergy

• Guadalupe Valley Electric

Cooperative

• Lower Colorado River Authority

• Oncor

• Pedernales Electric

Cooperative

• Texas-New Mexico Power Co

C E N T R A L T E X A S L E A D R E G I O N

• Cover letter that addresses consultant’s key criteria

• Specific information on site (building specs, map, photo of

building etc.)

• Community Profile (demographics, workforce availability,

industry profile, etc.)

• Information on Incentives

• Your contact information

• Site Summary Spreadsheet

K E Y E L E M E N T S O F A P R O P O S A L

S I T E S U M M A RY S P R E A D S H E E T

• Company selects Texas sites to visit

• Company narrows list to a single Texas site and sites in other states

• State of Texas puts together incentive package to complement local efforts

• Possible Texas Enterprise Fund (TEF) and other incentive negotiations

• Prospect decides to locate in TEXAS!

S I T E L E A D A N D P R O J E C T M A N A G E M E N T

P R O C E S S

R F I R E S P O N S E P R O C E S S

• First Rule of Lead Response

• Only respond if you meet the criteria requested by the consultant

or prospect

• Second Rule of Lead Response

• Convey the information the prospect wants upfront and in a

readily accessible way

• Third Rule of Lead Response

• Read and carefully follow the RFP response instructions

provided

B E S T P R A C T I C E S : R E S P O N D I N G TO L E A D S

• Submit a proposal if you don’t fulfill the requirements

• Make prospect search for their key criteria within your proposal

• Be late

• Go overboard with marketing materials and extraneous information

• Assume the consultant or company knows where your community is located

D O N ’ T

• Include sites which don’t meet requirements (ie. MLS listings of all your available buildings)

• Leave any survey questions blank

• Belittle your Texas neighbors

• Accidentally include comments in e-mailed proposals that aren’t

for readers’ eyes

• Include miscellaneous materials (ie. buttons, keychains) in hard-

copy proposals – these belong at the site visit

D O N ’ T

• Address all of the prospect’s requirements

• Keep the proposal simple and in the order requested

• Only provide requested information

• Submit proposal on time!

• Identify site(s), community and yourself

• Include excellent maps

• Communicate with your regional allies (Utility, Rail, Port,

Regional Org, etc.) to avoid duplication

D O …

Usually, leads will include an Excel spreadsheet listing:

• Key criteria with check boxes for each

• Space to list the contact information for each property

submitted

• Name of SBD project manager

R E C E N T C H A N G E S TO L E A D P R O C E S S

I N C E N T I V E S & F I N A N C I N G

T E X A S E N T E R P R I S E F U N D ( T E F )

In 2017, the 85th

Legislature fully funded

the Texas Enterprise Fund.

TEF is one of the largest deal-closing funds of its kind and continues to generate

significant job creation and capital investment in Texas.

TEF is a performance-based cash grant for projects where a single Texas site is

competing with another viable out-of-state option.

COMPANY NEW JOBS CAPITAL INVESTMENT TEF OFFER

NTT Data, Inc. (HQ) 6,377 $28,800,000 $7,499,352

Cognizant Technology Solutions 1,090 $8,452,000 $2,105,880

Charles Schwab & Co., Inc. 1,200 $100,000,000 $6,000,000

McKesson Corp. 975 $157,000,000 $9,750,000

Merck & Co., Inc. 600 $24,000,000 $6,000,000

Kubota Tractor Corp. (HQ) 344 $57,000,000 $3,800,000

Hulu, LLC 214 $13,660,000 $1,284,000

Ryder Integrated Logistics, Inc. 205 $5,266,000 $1,050,000

W.W. Grainger, Inc. 178 $3,900,000 $906,910

PGA of America (HQ) 150 $30,000,000 $1,500,000

Jacobs Engineering Group, Inc. (HQ) 111 $4,000,000 $1,238,760

CORE West, Inc. 97 $4,000,000 $970,000

*Sampling of TEF awards under the Abbott administration

SINCE 2004

$608 MILLIONIN TEF FUNDS AWARDED

TO

162

COMPANIES94,200 JOBSAND MORE THAN

$27 BILLIONIN CAPITAL INVESTMENT

T E F E L I G I B I L I T Y

T E F E L I G I B I L I T Y

✓Competition with another state for the project must exist and the business must

not have already made a location decision.

✓Projected new job creation must exceed 75 jobs in urban areas or 25 in rural

areas.

✓The new positions must offer compensation above the average wage of the

county where the project would be located.

✓A significant rate of return on the public dollars being invested in the project

must be demonstrated.

✓The project must have community participation from the city, county, and/or

school district, primarily in the form of local economic incentive offers.

✓The Governor, Lieutenant Governor, and the Speaker of the House must

unanimously agree to support the use of TEF for each specific project.

T E F E L I G I B I L I T Y

Application IntakeDay 1 Due

Diligence2-3

WeeksLeadership

Review30-44 Days

8-10 Weeks Average Timeline from Completed Application

T E F P R O C E S S & T I M E L I N ET E F P R O C E S S & T I M E L I N E

TEF Award Determination

• Award amount ranges from $1k - $10k per new job.

• Award amount depends on many factors including wages, job ramp

up, capital investment and return on investment to the State.

Disbursements

• Performance-based agreement, with disbursements issued after new

jobs have been created and verified.

• Must maintain baseline jobs throughout life of the contract.

T E F A G R E E M E N TT E F A G R E E M E N T

T E X A S E N T E R P R I S E Z O N E

• Awards refunds on state sales and use taxes paid by companies creating or retaining

jobs in or outside of economically distressed areas designated as Enterprise Zones.

• Amount of refund based on job creation/retention and capital investment.

• Maximum 105 designations allowed per biennium.

48.5 DESIGNATIONS

$5.81 BILLION

$34.2 MILLION

APPROVED DURING FY 2017-18

COMMITTED CAPITAL INVESTMENT

REFUNDED DURING FY 2017-18

3,403

15,653

TOTAL JOBS FOR BENEFIT FY 2017-18

S K I L L S D E V E L O P M E N T F U N D

Overview

• Grants are provided to help companies form partnerships with local community

colleges and technical schools to provide custom job training.

• Average training cost is $1,800 per trainee.

Eligibility

• Partner with an eligible grant applicant.

• Be actively involved in the planning and design of the customized training project.

• Pay wages to the employees who complete the training program that are equal to or

greater than the prevailing wage for the occupation in the local labor market.

• Sign an agreement with the grant applicant outlining each entity's roles and provide

equal employment opportunity documentation.

• Use WorkinTexas.com to post openings for new workers trained under the project.

T A X I N C E N T I V E S

Manufacturing Exemptions: State sales and use tax exemptions for tangible property, natural gas and electricity.

Freeport Exemptions: Tax exemption for certain goods that enter and leave Texas within 175 days.

Renewable Energy Incentives: Tax exemptions and deductions for solar, wind, ethanol and biodiesel.

Research & Development Tax Credit: Gives companies a choice between a franchise tax credit and a sales tax exemption for

materials, software, and equipment used for R&D purposes.

Data Center Tax Incentives: Allows qualifying data centers to receive sales and use tax exemption on tangible personal property.

Business Relocation Tax Deduction: Allows a company relocating its headquarters from out of state to Texas to deduct relocation

and moving expenses from their margin when calculating franchise tax liability.

Local funding to business-related infrastructure

and recruitment, equipment, land and economic

development purposes.

Property tax abatements

Permitting fee waivers

Local cash grants

C O M M U N I T Y I N C E N T I V E S

Texas and local communities offer a variety of tax incentives and innovative solutions for businesses

expanding in or relocating to Texas. The following incentives are the most commonly applied offerings.

O T H E R I N C E N T I V E S & F I N A N C I N G

O T H E R A S S I S T A N C E

Permit Assistance: TCEQ and EDT have established a relationship to assist companies that may experience unwarranted

delays in their environmental permitting process.

In-State Tuition for Employees: Allows employees and family members of the qualified businesses who have not yet

located in Texas to pay in-state tuition fees if the individual files with a Texas institution of higher education.

The Texas Economic

Development and

Tourism Office

gov.texas.gov/business

THANK YOU

Betty Russo

Betty.Russo@gov.texas.gov

281-222-6814

TexasEconDev