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Record of Proceedings

Houston Economic Development Committee Meeting - September 16, 2026: Tax Abatement and Financial Policies

Committees and Commissions — Wednesday, September 16, 2026
BodyHouston, Texas
SessionCommittees and Commissions
DateWednesday, September 16, 2026
StatusFILED
Video Record
0:00 / 1:37:13

Transcript — VerbatimClick a line to jump · ⧉ to share it
0:15

I don't know what it is about this.

0:20

Lower floor, is it?

0:22

Sure.

0:24

Okay.

0:25

You ready?

0:26

Let me start.

0:29

Good afternoon.

0:33

Okay, you're good.

0:34

It is Wednesday, September the 16th, and the time is now 2.03.

0:38

I'm Mayor Pro Tim Castex Tatum, the chair of Economic Development Committee, like to call this meeting to order.

0:44

We do have here in the chamber our uh co-chair uh Fred Flickinger, uh Councilmember Julian Ramirez is here with us today.

0:58

Councilmember Alejandra Salinas is with us today, Councilmember Sally Alcorn, Councilmember Joaquin Martinez is here, Councilmember Willie Davis is here.

1:08

We also have staff from Councilmember Castillo's office, from Councilmember Carter's office, uh from Councilmember Tiffany D.

1:16

Thomas's office, uh Councilmember Tarsha Jackson has joined us in the chamber as well.

1:22

Thank you, colleagues, for being here.

1:24

Uh this meeting is open to the public.

1:26

It's been held in person and virtually.

1:29

We're also broadcasting on HTV.

1:32

Council members, we all know the drill.

1:34

If you have questions, we will definitely get to those.

1:37

Uh Vice uh Chair Flickinger, do you have any remarks you'd like to make before we begin?

1:43

No, ma'am.

1:44

All right.

1:44

There are four members of the public who have signed up to speak today.

1:48

If there are any additional public speakers that would like to speak, uh we do have a sign-up sheet here on my left.

1:56

Um you can uh sign up with our University of Houston CHIP intern Heya Alani.

2:04

Y'all give it up for Haya who's helping us today.

2:07

Thank you, Haya.

2:09

Uh public speakers will have a chance to speak at the conclusion of the presentation.

2:14

Any questions can also be emailed to us at the district office.

2:19

Our first um item on the agenda today, we will hear from uh Chief Economic Development Officer Gwen Tillotson with the mayor's office of economic development, and she will um give us a presentation on the proposed amendments to Chapter 44 tax abatement ordinance.

2:38

Um, colleagues, thank you for all meeting with Chief Tillotson and sharing your thoughts and ideas.

2:44

Um she has done a wonderful job of pulling this all together, and we are ready for your presentation, Chief Tillitson.

2:52

Very good.

2:52

Good afternoon, Mayor Pro Tem and Council.

2:54

Thank you for the opportunity to share an update on the Chapter 44 proposed amendments.

3:00

Um what I'm gonna do is just spend a little time giving some background.

3:03

I know that most are familiar with kind of the requirement every two years, but I think it's just gonna put everything in perspective, uh, talk some about the proposed amendments, and then um our recommendation to move forward to council, uh describe a little bit of the timeline, and then open it up for QA.

3:19

So with that, the next slide.

3:23

So many of you are familiar with the requirement of Chapter 312 that every two years once the city has adopted their program guidelines, those guidelines have to be renewed and approved by City Council.

3:36

Um so in 2024, we approved the two-year, or we renewed the two-year abatement guidelines, and those guidelines uh took us through August 28th of this past year.

3:50

On August 19th, my staff did do a presentation to this board um describing the requirement for the renewal and asking for council to consider adopting the current guidelines, which was approved in 2024, with the understanding that we would be engaging with council and speaking with council so that we could get some comments back on proposed amendments.

4:13

Um our office as well had some proposed amendments that we wanted to submit, but um we just didn't have uh enough time to get to to do a thorough job of getting those amendments or fully engaging council.

4:25

So the request was to approve the uh abatement program so that the program was not would not terminate and we wouldn't that have would not have a disruption.

4:34

Council was gracious to do so, um, but with under under the understanding that we would come back with some proposed amendments after we've heard back and had an opportunity to engage fully with council.

4:45

Next slide.

4:50

Um, so again, I just repeated that.

4:53

So um again, it was approved with some conditions.

5:00

And what we're doing right now is having a conversation so that we could clear those conditions and make sure that what gets presented for the tax abatement ordinance and the program is in consideration with all of the feedback that we receive from council.

5:12

Next time.

5:15

So since August 26th, I just want to do a quick timeline of all of the actions that have occurred.

5:21

So between August 31st and August, September 8th, we met with any of the council members who wanted to bring some recommendations and some feedback forward.

5:37

And so during that time, I actually met with 10 council members that either submitted written amendments for us to consider or had some conversations about how they believe the tax abatement program could be amended to really meet some of their individual needs within their own districts and with their own constituency.

5:56

Every council district is different, the needs are different, and we did our best to try to accommodate all of the requests, either directly by uh inserting it into the ordinance or application or some other document that would allow us to be responsive to the needs of the constituents.

6:13

Um between September 2nd and September 9th, that's when we had those um series of meetings as well.

6:19

Uh on September 10th, we completed a very high-level summary of what those amendments were.

6:25

And um on the 11th, we drafted our recommendations.

6:30

So again, we've been meeting with legal.

6:31

I just want to make that clear.

6:33

This entire process was very iterative with the legal department.

Discussion Breakdown — Share of Meeting
Economic Development█████████████████████████████████████████████74%
Miscellaneous███████████18%
Procedural█2%
Community Engagement█1%
Audit and Oversight█1%
Fiscal Sustainability█1%
Workforce Development█1%
Environmental Protection█1%
Zoning And Land Use█1%
Summary of Proceedings

Houston Economic Development Committee Meeting - September 16, 2026: Tax Abatement Amendments and Financial Policies Update

The Economic Development Committee of the Houston City Council, chaired by Mayor Pro Tem Castex Tatum, met on Wednesday, September 16, 2026, at 2:03 PM and adjourned at 3:40 PM. The meeting focused on proposed amendments to Chapter 44 of the tax abatement ordinance and an annual update on financial policies, including 380 agreements, tax abatements, Texas Enterprise Zone nominations, and industrial district assessments. Four public speakers registered and testified, with additional speakers joining later.

Public Comments & Testimony

  • Josiah Rector (Texas State Employees Union Local 6186) expressed support for amendments proposed by Councilmember Salinas, arguing that Houston lags behind Austin, San Antonio, Dallas, and Harris County in worker protections. He urged strengthening audits and inspections beyond payroll records to include labor classifications, safety training, workers' compensation, and health insurance benefits.
  • Spiridon Hoxa (law student) supported the amendments, stating worker protections lead to good outcomes and that the cost of living crisis requires attention to average Houstonians.
  • Juan Rubio (Workers' Defense Project) supported improved labor standards tied to tax abatements, citing member experiences with workplace safety violations. He emphasized the need for fair wages, safe workplaces, and benefits.
  • Dominic Shakan (Texas Campaign for the Environment) questioned whether tax breaks truly benefit the local economy, referenced a $92.9 million loss in taxes from industrial district agreements, and urged stronger oversight and transparency. He also noted that top abatement recipients are often air permit violators located in vulnerable communities.
  • Linda Morales (Gulf Coast Area Labor Federation) spoke after the formal session, expressing appreciation for the proposed language, especially the shift from "good faith effort" to "required" for apprenticeship utilization, and support for audits and child care subsidies.
  • Mary Wright raised concerns about data center tax abatements and lack of community notification, citing a recent meeting in Jacinto City where residents only recently learned about a proposed data center.

Discussion Items

Chapter 44 Tax Abatement Ordinance Amendments (Presented by Chief Economic Development Officer Gwen Tillotson)

  • Tillotson outlined that Chapter 44 guidelines must be renewed every two years under Chapter 312 of state law. The current guidelines were extended in August 2026 with a commitment to return with amendments after council engagement.
  • Since August 26, Tillotson met with 10 council members and incorporated feedback. Proposed amendments include:
    • Minimum wage floor tied to the City of Houston municipal wage (codified as a requirement).
    • Prevailing wage for construction workers.
    • Workers' compensation requirement for construction workers.
    • Health insurance benefits for full-time employees.
    • Exclusion of contractors with substantial wage theft or OSHA violations (with recapture and termination provisions).
    • Strengthened apprenticeship utilization: 15% of construction labor from certified Department of Labor programs (changed from good faith effort to requirement).
    • Enhanced audits and inspections.
    • Child care subsidies as a community benefit.
    • Commercial revitalization: removing job creation requirements for developers to allow grocery stores and retail in food deserts.
    • Community engagement: for infill developments within super neighborhoods, companies must notify and obtain a letter of support.
  • Tillotson noted that the legal department assessed risk levels (low, moderate, high) for each amendment and reviewed against state and federal laws.
  • The Greater Houston Partnership reviewed and supported the proposed amendments.
  • Councilmember Martinez withdrew his first proposed amendment. For his second amendment (but-for justification), Tillotson agreed to incorporate additional questions into the application or evaluation matrix.
  • On Councilmember Salinas' eight floor amendments, Tillotson indicated most would be adopted but legal would determine exact placement in the code. Chair Tatum limited detailed discussion, suggesting council members meet offline after legal provides the red line.
  • Councilmember Flickinger questioned definitions of wage theft and OSHA violations, noting that minor violations could disqualify companies. Tillotson agreed to refine language to allow discretion based on severity.
  • Councilmember Davis raised concerns about staffing to monitor OSHA compliance; Tillotson said existing staff would use public reports.
  • Councilmember Ramirez requested the full legal analysis; Tillotson agreed to provide it.
  • Timeline: Red line of amendments to be circulated by Monday, September 21; final ordinance to be presented to City Council within 30 days.

Financial Policies Update (Presented by Assistant Director Jennifer Curly)

  • Curly reported on active tax abatement agreements (11 total), including Kroger, UPS, Scanska, and Blex Exchange. Two agreements (Cullen Apartments, MCOP LLC) are not in compliance. New agreements have not yet started abatement periods.
  • The 380 program (created 1999) has 19 active projects, mostly under construction, reimbursing for public infrastructure or job creation. Centerpoint Hotels and Meow Wolf have not yet submitted for reimbursement.
  • Texas Enterprise Zone nominations: 5 of 9 biennial slots remain (ends 2027). No city funding required.
  • Industrial district assessments: revenue grew from $14 million in FY14 to $30 million in FY26. The city's 15-year agreements are up for renewal; staff proposes increasing the fee (currently 40-50% of appraised value) based on higher rates charged by other districts.
  • Councilmember Martinez asked about abatement duration (10 years by ordinance) and clarified that renewals are for different projects, not perpetual.
  • Councilmember Ramirez questioned the "retained jobs" category and requested more detail on industrial district invoices.

Key Outcomes

  • The committee received the presentations and public testimony; no formal votes were taken.
  • Chief Tillotson will circulate the red line of Chapter 44 amendments (legal language) to council by Monday, September 21, 2026.
  • Staff will continue to meet with council members individually to finalize language before the ordinance is presented to City Council; expected within 30 days.
  • The next Economic Development Committee meeting is scheduled for October 21, 2026, at 2:00 PM.

Meeting Transcript

I don't know what it is about this. Lower floor, is it? Sure. Okay. You ready? Let me start. Good afternoon. Okay, you're good. It is Wednesday, September the 16th, and the time is now 2.03. I'm Mayor Pro Tim Castex Tatum, the chair of Economic Development Committee, like to call this meeting to order. We do have here in the chamber our uh co-chair uh Fred Flickinger, uh Councilmember Julian Ramirez is here with us today. Councilmember Alejandra Salinas is with us today, Councilmember Sally Alcorn, Councilmember Joaquin Martinez is here, Councilmember Willie Davis is here. We also have staff from Councilmember Castillo's office, from Councilmember Carter's office, uh from Councilmember Tiffany D. Thomas's office, uh Councilmember Tarsha Jackson has joined us in the chamber as well. Thank you, colleagues, for being here. Uh this meeting is open to the public. It's been held in person and virtually. We're also broadcasting on HTV. Council members, we all know the drill. If you have questions, we will definitely get to those. Uh Vice uh Chair Flickinger, do you have any remarks you'd like to make before we begin? No, ma'am. All right. There are four members of the public who have signed up to speak today. If there are any additional public speakers that would like to speak, uh we do have a sign-up sheet here on my left. Um you can uh sign up with our University of Houston CHIP intern Heya Alani. Y'all give it up for Haya who's helping us today. Thank you, Haya. Uh public speakers will have a chance to speak at the conclusion of the presentation. Any questions can also be emailed to us at the district office. Our first um item on the agenda today, we will hear from uh Chief Economic Development Officer Gwen Tillotson with the mayor's office of economic development, and she will um give us a presentation on the proposed amendments to Chapter 44 tax abatement ordinance. Um, colleagues, thank you for all meeting with Chief Tillotson and sharing your thoughts and ideas. Um she has done a wonderful job of pulling this all together, and we are ready for your presentation, Chief Tillitson. Very good. Good afternoon, Mayor Pro Tem and Council. Thank you for the opportunity to share an update on the Chapter 44 proposed amendments. Um what I'm gonna do is just spend a little time giving some background. I know that most are familiar with kind of the requirement every two years, but I think it's just gonna put everything in perspective, uh, talk some about the proposed amendments, and then um our recommendation to move forward to council, uh describe a little bit of the timeline, and then open it up for QA. So with that, the next slide. So many of you are familiar with the requirement of Chapter 312 that every two years once the city has adopted their program guidelines, those guidelines have to be renewed and approved by City Council. Um so in 2024, we approved the two-year, or we renewed the two-year abatement guidelines, and those guidelines uh took us through August 28th of this past year. On August 19th, my staff did do a presentation to this board um describing the requirement for the renewal and asking for council to consider adopting the current guidelines, which was approved in 2024, with the understanding that we would be engaging with council and speaking with council so that we could get some comments back on proposed amendments. Um our office as well had some proposed amendments that we wanted to submit, but um we just didn't have uh enough time to get to to do a thorough job of getting those amendments or fully engaging council. So the request was to approve the uh abatement program so that the program was not would not terminate and we wouldn't that have would not have a disruption. Council was gracious to do so, um, but with under under the understanding that we would come back with some proposed amendments after we've heard back and had an opportunity to engage fully with council. Next slide. Um, so again, I just repeated that. So um again, it was approved with some conditions. And what we're doing right now is having a conversation so that we could clear those conditions and make sure that what gets presented for the tax abatement ordinance and the program is in consideration with all of the feedback that we receive from council. Next time.

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