Houston Economic Development Committee Meeting – August 19, 2026
Houston Economic Development Committee Meeting – August 19, 2026
The Economic Development Committee of the Houston City Council, chaired by Mayor Pro Tem Martha Castax Tatum, met on August 19, 2026, at 2:00 PM. The committee heard two presentations from the Mayor's Office of Economic Development (MOED): a proposed readoption of the city's tax abatement ordinance (expiring August 28, 2026) and a specific tax abatement request for Ferguson Enterprises LLC. Three members of the public testified, raising concerns about historic preservation, corporate tax breaks, and community benefit accountability. No formal votes were taken; the committee forwarded both items to the full City Council for action.
Public Comments & Testimony
- Lisa Jenkins, representing a nonprofit restoring the Evergreen Negro Cemetery in the Fifth Ward, requested in-kind municipal support (e.g., public works crews, CDBG funds) to maintain the cemetery grounds and address homelessness on the site. She noted the cemetery has a historic designation and that 39 disinterred remains were reburied earlier this year. Councilmember Davis directed staff to connect her with the Parks Department and the city's homeless outreach coordinator.
- Dominique Shakan, Texas Campaign for the Environment, criticized the city's tax abatement program, stating that about $93 million in property tax revenue is foregone through Industrial District Agreements, with insufficient oversight and enforcement. He argued that large corporations like ExxonMobil do not need incentives and urged the committee to review agreements for clawback opportunities, noting that many 10-year agreements are expiring this year.
- Rain Eatman advocated for strengthening community benefit requirements in abatement agreements. He questioned the Ferguson proposal's vague pledges on affordable housing, tourism, and grocery stores, given that the site is in a heavily industrial, polluted area of East Houston. He suggested requiring companies to partner with local council members on job fairs and training.
Discussion Items
1. Tax Abatement Ordinance Readoption
Andrew Busker, senior staff analyst, presented a proposed readoption of the current tax abatement ordinance (Ordinance 2024-624) with no material changes. The ordinance, authorized under Chapter 312 of the Texas Tax Code, expires at midnight on August 28, 2026. Busker explained that without readoption, the city would lose the ability to process any new tax abatement applications (existing agreements would remain valid). The committee discussed:
- Future amendments: Busker noted that MOED plans to bring broader amendments in 2027 but welcomes council input now. Councilmember Flickinger pushed for focusing on sales and property tax revenue generation rather than jobs, given low unemployment. Councilmember Salinas expressed interest in minimum wage requirements. Chair Tatum asked council members to send suggestions to Director Tillotson.
- Compliance enforcement: Councilmember Ramirez asked about enforcement. Busker confirmed annual notarized reporting and verification with Texas Workforce Commission and HCAD. He cited a recent example: Converge Midstream failed to submit compliance documentation in 2026 and lost its abatement for that year (the agreement remains valid).
- Timeline: A public hearing is scheduled for the same day as the ordinance vote next week. Busker said the item could be tagged, but that would create a gap in the city's ability to issue abatements.
2. Tax Abatement for Ferguson Enterprises LLC
Busker presented a proposal for Ferguson Enterprises, a Fortune 500 distributor of water, HVAC, and fire safety solutions. The company plans to build a manufacturing, fabrication, and distribution facility in District B (at Mesa Drive and Beaumont Highway, within a Texas Enterprise Zone and Opportunity Zone). Key details:
- Investment: $25.9 million total capital (building shell already constructed by another entity; $5M eligible building improvements, $15.9M machinery/equipment, $0.8M personal property).
- Jobs: 66 new jobs within five years (64 fabricators at $75,000 average annual salary; 2 supervisory positions at six-figure salaries). Total estimated annual wages: $5.57 million.
- Competition: The company was considering Atlanta, where labor costs are lower and facility costs were similar.
- Abatement terms: Up to $1 million over 10 years (90% of eligible costs), with a first-year projection of $97,000 and declining annual values. The abatement will not apply to the existing building shell, so the city continues to collect full property tax on that portion.
- Committee questions: Councilmember Ramirez noted the wage discrepancy between $4.95 million (64 jobs x $75k) and the stated $5.57 million (explained by the two higher-paid jobs). Councilmember Flickinger asked about the cumulative abatement value ($909,000 projected) and confirmed the city retains tax on the shell.
Key Outcomes
- The committee will recommend that the full City Council readopt the tax abatement ordinance without changes at its August 26 meeting, ahead of the August 28 expiration. A formal vote is required to avoid a lapse.
- The Ferguson Enterprises tax abatement proposal will also proceed to the full Council for a vote. No committee vote was taken; the item is on next week's agenda.
- MOED will present a report on current tax abatement performance data at the September 16, 2026, Economic Development Committee meeting (as requested by a council member during budget discussions).
- The committee acknowledged plans to consider future amendments to the ordinance in 2027, with input from council members and the public.
Meeting Transcript
I'm Mayor Pro Team Martha Castax Tatum, the Chair of Economic Development, and I'd like to call this meeting to order. Do want to welcome our committee and council members and their staff and our guests that are in attendance today. Our Vice Chair Flickinger is here, Councilmember Martinez Ramirez, Councilmember Alcorn, Vice Mayor Pro Tim Peck. We also have staff from Councilmember Castillo's office from Councilmember Carter's office, staff from Councilmember Salinas's office, and also staff from Council Member Thomas's office. The meeting is open to the public and being held in person and virtually. Council members, you know the drill if you have questions. Our first presentation today will be done by and first and second presentation will be done by Andrew Busker. He's the senior staff analyst with the mayor's office of economic development, and he'll present the first presentation on the tax abatement ordinance readoption. If there are any members of the public that would like to speak, uh there is a sign-up sheet on my left. We'd be happy to hear from you after we conclude our presentations. Mr. Busker, I do want to uh welcome councilmember Willie Davis uh to the chamber as well. We're ready to hear from you, Andrew. Good afternoon, everyone. Um our first presentation is the tax abatement ordinance readoption. Um I don't know if you all can see slides at this time or you have copies? Okay. Um so our tax abatement program um is authorized under chapter 312 of the Texas Tax Code, and the statute is uh fairly broad, it enables municipalities to create tax abatement programs and guidelines and criteria. The main two requirements under this uh statute is that these tax abatements cannot exceed a 10-year term, and then um cities have to renew their tax abatement ordinances every two years to keep them current. Next slide, please. So our current ordinances um 2024-624, which was uh approved by city council on August 28th, 2026, or or sorry, 2024. My bad. Um August 28th, 2024, and so uh that's coming up. Um, and so our current tax abatement program has uh five different uh pieces to it. The economic development abatement, which is our bread and butter abatement. We also have develop uh Brownfield development abatement, uh which is um described in the state statute. There's a lead tax abatement, a green stormwater water screen, sorry, green stormwater infrastructure abatement and deteriorated and demolished property abatement. Those are our um five programs. Uh next slide, please. So going through some of the historical changes that we've made over time. So what's nice about having a two-year uh sunset period is that you know every couple of years we can assess what's working, what's not, um, where our economy is moving, the things that we have to adjust. Um, and so I have some highlights that are from the past uh 10 years or so. Um, I'll move this through this relatively quickly. So in 2016, we added um additional favorable considerations for community benefits, including mid-skill jobs and those sort of things. And then two years later in 2018, we were we moved from favorable conditions into having actual requirements for community benefits in our tax abatement program. Um next slide, please. Then in 2020, um we then were creating um a space for uh reduced eligibility requirements for uh projects that would be located within opportunity zones. Um also around that time we then created the green stormwater green stormwater infrastructure abatement um and uh updated our lead abatement, and so um those came into place about six years ago. Um then um we've also like if things are moving well, like in 2022, we just adopted it with no material changes. Um so then in our last change to the ordinance in 2024, uh we made many changes, and so that's on uh the next slide. So uh first thing we we decrease the minimum total project costs uh and green stormwater infrastructure infrastructure costs um for the different eligibility for the GSI abatement. So smaller projects now are eligible for GSI. Um we expanded what costs were eligible on the under the GSI program. We also added language to our public hearings uh to better align with the state statute. Um in our changes to public hearings. Uh we also added that public notices for anything uh tax abatement tax abatement related for our agreements needs to also be posted on the city website. Uh and then uh previously on our sunset provisions, we just had the date, and so for legal clarity, we also added the time when the ordinance would expire. So um next slide, please. So for the 2026 renewal of our ordinance, we are proposing to readopt the current tax abatement ordinance with no material changes. Um for this we're we're doing this because we have some proposed edits and things that we're working through internally.
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