AUSTIN (KXAN) — With all the talk of stateâ€™s budget crunch, some criticism has surrounded the Texas Enterprise Fund â€“ money used to lure companies to set up a Lone Star shop.
But after a look at the numbers, it looks like the fund has done quite a bit of financial good for the state. Since the Legislature set up the fund a decade ago, 102 companies have been awarded money.
The idea behind the fund is to not only attract more businesses to the state, but also create more jobs. The governor, lieutenant governor and speaker of the House must approve the awards. Gov. Rick Perryâ€™s office said they have become one of the â€œstateâ€™s most competitive tools to recruit and bolster business.
Since its creation, the fund has invested more than $472 million, helping to generate more than 63,900 news jobs and $22.6 billion in capital investment, according the Perryâ€™s office.
The latest is Visa U.S.A. Inc. Announced late last month, the company plans to build a new global IT center and create 794 new jobs in Austin. In reply, the state offered the company $7.9 million from the TEF â€“ though that agreement will only come with local incentives, something the city plans to address this week.
Austin-based companies have seen the most number of awards â€“ 15. The top recipient cities include:
Austin - 15
San Antonio - 10
Houston - 7
Fort Worth - 4
Irving - 4
Richardson - 4
Dallas - 3
While urban areas have benefited most, a large amount of disbursements went to places with smaller populations compared to those large cities. In the last fiscal year those included Belton, Seguin, Corscicana, Freeport and Baytown.
The 2010-2011 saw the most number of awards â€“ 34. This year, there have been 13, including Visa.
Companies that have located to Austin after their awards include:
Home Depot (IT & distribution)
HelioVolt Corp. (solar panel)
LegalZoom (legal documents)
SunPower Corp. (solar power)
Hangar Orthopedic medical devices)
Office Depot (office supply)
Facebook (social media)
HID Global (electronic ID systems)
The Advisory Board Company (health care research, technology & consulting)
State records show the fund helped those Austin companies have or will have generated a total of nearly 12,500 jobs over the last decade. The total amount of their awards is listed as more than $106 million.
Still, a St. Edward's University economics professor has concerns the fund's success might be misleading.
"A criticism that has been made of Texas is that you're not really creating more activity that's happening in Texas," said Matthew Clements, Ph.D. "You're just getting it to move to Texas as opposed to somewhere else."
But Gov. Rick Perry's office said the TEF and other programs have the state unemployment rate stay below the national average, even as the population has continued to grow "due to individuals from out of state moving here and looking for jobs."
"Creating jobs helps everyone - both Texans already living here and individuals moving to our state looking for economic opportunity and a good quality of life - and is the key to keeping up Texas' strong economic momentum," said Lucy Nashed, the governor's spokeswoman. "The same policies of low taxes, reasonable regulations, fair courts and skilled workforce that attract employers are also a beacon for individuals living in high tax, high regulation states and looking for the freedom to prosper."
For critics who say the TEF is taking too much out of the state's budget which could be spent on schools and healthcare - the legislature has been conservative with the fund lately. The governor's office explained that last session lawmakers did not appropriate any additional money, but instead allowed money not spent from the fund to be available for awards this budget cycle.
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