Texas in-state tuition incentive for employees & family members
New Market Tax Credit Program (Federal)
The New Market Tax Credit (NMTC) Program incentivizes community development and economic growth through the use of tax credits that attract private investment to distressed communities. The NMTC Program attracts private capital into low-income communities by permitting individual and corporate investors to receive a tax credit against their federal income tax in exchange for making equity investments in specialized financial intermediaries called Community Development Entities (CDEs).
The Treasury Department’s Community Development Financial Institutions (CDFI) Fund allocates tax credit authority to CDEs who offer tax credits to investors in exchange for equity in the CDE. Using the capital from these equity investments, CDEs can make loans and investments to businesses operating in low-income communities on better rates and terms and more flexible features than the market. In exchange for investing in CDEs, investors claim a tax credit worth 39% of their original CDE equity stake, which is claimed over a seven-year period.
CDEs have approved service areas that range from local to national in scale. CDEs that may have available NMTC allocation authority remaining, and the amount of Qualified Equity Investments not yet raised, can be identified on the CDFI Fund website.
NMTC-qualified low income Census Tracts exist in all 5 counties of the Austin MSA and can identified with the CDFI Fund’s mapping tool.
Opportunity Zones Program (Federal)
An Opportunity Zone is an economically-distressed community where new investments, under certain conditions, may be eligible for preferential tax treatment. Localities qualify as Opportunity Zones if they have been nominated for that designation by the state and that nomination has been certified by the Secretary of the U.S. Treasury via his delegation of authority to the Internal Revenue Service. Opportunity Zones are an economic development tool—that is, they are designed to spur economic development and job creation in distressed communities.
Opportunity Zones are designed to spur economic development by providing tax benefits to investors. First, investors can defer tax on any prior gains invested in a Qualified Opportunity Fund (QOF) until the earlier of the date on which the investment in a QOF is sold or exchanged, or December 31, 2026. If the QOF investment is held for longer than 5 years, there is a 10% exclusion of the deferred gain. If held for more than 7 years, the 10% becomes 15%. Second, if the investor holds the investment in the Opportunity Fund for at least 10 years, the investor is eligible for an increase in basis of the QOF investment equal to its fair market value on the date that the QOF investment is sold or exchanged.
A Qualified Opportunity Fund is an investment vehicle that is set up as either a partnership or corporation for investing in eligible property that is located in a Qualified Opportunity Zone.
Qualified Opportunity Zone Census Tracts exist in all 5 counties of the Austin MSA and can identified with the CDFI Fund’s mapping tool. A regional Opportunity Zones map is also located on Opportunity Austin’s website.
HUBZone Program (Federal)
The HUBZone program fuels small business growth in historically underutilized business zones with a goal of awarding at least 3% of federal contract dollars to HUBZone-certified companies each year. The government limits competition for certain contracts to businesses in historically underutilized business zones. It also gives preferential consideration to those businesses in full and open competition. Joining the HUBZone program makes your business eligible to compete for the program’s set-aside contracts. HUBZone-certified businesses also get a 10% price evaluation preference in full and open contract competitions. HUBZone-certified businesses can still compete for contract awards under other socio-economic programs they qualify for.
To qualify for the HUBZone program, a business must: be a small business; be at least 51% owned and controlled by U.S. citizens, a Community Development Corporation, an agricultural cooperative, an Alaska Native corporation, a Native Hawaiian organization, or an Indian tribe; have its principal office located in a HUBZone; and have at least 35% of its employees living in a HUBZone.
Businesses need to recertify for the HUBZone program once a year. There is no limit to the length of time a business can participate as long as it continues to qualify. Businesses that purchase a building or enter a long-term lease (of 10 years or more) may maintain HUBZone eligibility for up to 10 years, even if at some point the office location no longer qualifies as a HUBZone.
Qualified HUBZone Census Tracts exist in 4 of the 5 counties of the Austin MSA and can be identified with the SBA HUBZone Map application.
Utility incentives
Area municipal utilities and cooperatives may offer financial incentives to qualifying customers. These economic development riders and business incentive plans are designed to encourage industrial and commercial development by providing additional start-up cost savings to large users of natural gas and electricity. Utility cost reductions can also be a benefit of Enterprise Zone projects.
Austin Energy, serving customers in the City of Austin, offers customers the option to select a portion of their electricity from clean, renewable energy sources through its GreenChoice program. GreenChoice customers receive a fixed GreenChoice charge over a long term that replaces the variable fuel charge tied to fuels that are subject to market volatility, like natural gas. Green building design consulting and commercial energy management services are provided free to customers. Companies may also qualify for conservation rebates or low-interest loans.
Austin Energy offers businesses 20+ different rebates and incentives addressing lighting, heating and cooling, chiller, building envelope, etc. Building owners, design professionals, contractors, or other agents are eligible to apply for Austin Energy new construction rebates on behalf of their customers. These projects can be building shells, complete build-outs, finish-outs, additions, and major building remodeling projects. This rebate may help reduce the cost of installing energy-efficient technologies. Businesses can also receive incentives to help reduce the cost of installing a solar energy system. Depending on the size of the system, business may be eligible to receive either a one-time check or monthly bill credits.
Bluebonnet Electric Cooperative, serving eastern/southeastern parts of the Austin metro, offers and a renewable interconnection program and a Green Energy Rate that purchases energy for the user from renewable wind power generated in West Texas.
Pedernales Electric Cooperative (PEC), serving much of the western part of the Austin metro, offers rebate incentives to help businesses install energy-efficient lighting technologies and HVAC equipment, a renewable energy rider rate allowing customers to power their business with 100% renewable energy, and a renewable interconnection program.
Oncor, the delivery company serving the deregulated areas of the Austin metro, offers a number of incentive programs, including savings for solar energy, insulation, ENERGY STAR® appliances, LED lighting, and battery storage. Oncor also supports interconnection with distributed generation systems. Some retail electric providers offer buy-back plans for surplus generation sent to the grid.
PACE programs
Property Assessed Clean Energy (TX-PACE) is a proven financial tool that incentivizes Texas’ property owners to upgrade facility infrastructure with little or no capital outlay. Approved by State legislation and established by local governments, TX-PACE programs enable owners to lower their operating costs and use the savings to pay for eligible water conservation, energy efficiency, resiliency, and distributed generation projects. Owners gain access to private, affordable, long-term (typically 10-20 years) financing that is not available through traditional funding avenues.
Bastrop, Caldwell, Hays, Travis and Williamson Counties’ PACE programs enable owners of non-profit, commercial, and industrial properties to obtain low-cost, long-term financing for water and energy efficiency improvements and solar generation retrofits. Private sector lenders finance qualified improvements and property owners voluntarily agree to contractual assessments imposed on the property. PACE improvements generate positive cash flow with no out-of-pocket cost to the property owner. If the property is sold before the full amount is repaid, the repayment obligation automatically transfers to the next owner.