A controversial taxpayer-funded business development fund run by Gov. Rick Perry is the source of a scathing report this morning and a few North Texas projects look like some of the biggest losers.
The report from the non-partisan Texans for Public Justice shows that more than 20 companies receiving taxpayer-funded Texas Enterprise Fund grants failed to meet their job creation promises or struggled to do so in 2008.
Perry has repeatedly touted the fund in recent years as a way he has brought more jobs to the state. His office revealed in a statement late yesterday that several TEF deals have been amended. A few other TEF deals have been terminated.
Twelve corporations were granted easier terms with the fund, including lower job-creation targets and lengthened deadlines, in light of business difficulties, a news release from the governor’s office said.
Among those companies are five firms whose North Texas facilities were given grants: Countrywide, which has a loan-servicing center in Fort Worth, Gulfstream, which has a Dallas facility, Fidelity Investments, which has a Westlake campus; Vought Aircraft, which has facilities in Dallas and Grand Prairie; Rockwell Collins in Richardson; and Authentix of Addison.
Several TEF deals are still in place but not doing so well, according to the report. One of the worst bets appears to have been Cabela's, a superstore for hunters that received tax breaks in 2004 to open new stores in Buda and North Fort Worth.
The company was supposed to receive up to $600,00 for creating at least 400 jobs. As of 2008, the store only had 241 hires. The report states that the store has received 66 percent of its TEF grant.
The public effort to get Cabela's to come to North Fort Worth attracted controversy from the start. A group called Fort Worth Citizens for Responsible Government sued Fort Worth in 2004 when city leaders announced plans to give Cabela's a break from city taxes by creating a tax-increment finance district on the planned location of the superstore. The lawsuit failed and the TIF was ultimately created.
Normally, TIFs are designed to renew blighted or rural areas that have difficulty developing. The Fort Worth Cabela's sits is at the intersection of two major highways in one of the fastest-growing areas of Tarrant County.
The full TPJ report is here.
-Aman Batheja
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